Terminating the Employment Relationship

Note that one of the ADEA waiver requirements is a 21-day period to consider the agreement. This does not require an employer to provide 21-days after the parties have executed the agreement to consider the agreement. Rather, the agreement should specifically states that the employee has had 21 days to consider the agreement. By signing the agreement, the employee acknowledges he or she has had 21 days to consider it. Conversely, there is no way to draft language to eliminate the 7-day revocation period. The 7-day revocation period must occur after execution of the agreement. The requirements above are only minimum requirements for a legally enforceable ADEA wavier. There are other factors courts will consider to determine if a wavier and release of ADEA claims is “knowing and voluntary.” In doing so, courts will apply a “totality of circumstances” test to consider non-statutory factors in assessing the enforceability of an ADEA waiver. These factors may include fraud, duress, or mutual mistake in entering into the waiver and release. 325

An employee may challenge the enforceability of an ADEA waiver that does not meet the minimum requirements without returning the consideration (e.g., money) received from the employer. 326

LCW Practice Advisor

Ellison v. Premier Salons Inter., Inc. 327 Premier Salons informed Ellison he was to be terminated. On June 20, 1995, Premiere Salons provided Ellison with a “Separation Agreement and Release of Claims” that included a severance package and a waiver of ADEA claims. Soon after, Premiere Salons learned that Ellison made defamatory statements about the company. On July 6, 1995, the Vice President called Ellison and informed him that Premiere Salons was revoking the agreement, which Ellison had not yet signed. Ellison sued alleging that the company could not revoke the agreement for 21 days because the minimum requirements of an ADEA waiver allowed him to consider it for 21 days before signing. The Court disagreed, finding that common law contract principles, which allow an offeror to revoke an offer before it is accepted, applied. Thus, Premiere Salons could revoke the offer at any time during the 21-day period if the employee had not yet signed the agreement. American Airlines, Inc. v. Cardoza-Rodriguez 328 American Airlines offered eligible employees a Voluntary Early Retirement Program (VERP). American provided employees with a booklet that provided the “Terms and Conditions” of the VERP. It warned employees to read materials carefully. In order to participate in the program, an employee was required to sign an agreement and release, which American did not provide to the employee until his/her last day of employment. The release stated, “I have had reasonable and sufficient time and opportunity to consult with an independent legal representative of my own choosing before signing this Complete Release of All Claims.” The VERP booklet did not, however,

Terminating the Employment Relationship ©2019 (s) Liebert Cassidy Whitmore 100