Terminating the Employment Relationship

internal complaint process, any settlement agreement to resolve the dispute may not contain a “no rehire” provision. “ N o rehire” provisions that restrict the employee from obtaining future employment with a division, affiliate, or contractor of an employer are also prohibited. There is a limited excepti on permitting “no rehire” provisions if the employer has made a good faith determination that the employee entering into the agreement engaged in sexual harassment or sexual assault. Section 1002.5 does not prohibit an employer and an employee from entering into an agreement to terminate a current employment relationship. Furthermore, nothing in section 1002.5 requires an employer to continue to employ or rehire a person if there is a legitimate, nondiscriminatory and non-retaliatory reason for terminating the employment relationship or refusing to rehire the person. In light of AB 749, agencies should carefully review with legal counsel the terms of any proposed settlement agreement that resolves claims filed by employees. Agencies should further ensure any agreements to settle claims or civil actions filed by employees do not contain a prohibited “no rehire” provision. Any provision in a settlement agreement that contains a “no rehire” term will be void as a matter of law and against public policy. 2. R EFERENCES FOR F UTURE E MPLOYMENT An agreement with an employee or ex-employee should specify how the employer will respond to future inquiries from potential employers. By doing so, the employer can avoid a future claim from the ex-employee that it int erfered with the employee’s attempts to obtain subsequent employment. The following is a sample references for future employment clause:

Jones agrees that he will direct inquiries from prospective/potential employers to only the City’s Human Resources Director. The Human Resources Director shall verify to potential employers Jones’ dates of employment, job titles, and any other information required to be released by law.

There are two important points to make regarding such a clause. First, inquiries should be directed to a position (e.g., Human Resources Director), not a person (e.g., Mary Smith”). Identifying a person rather than a position can create ambiguity if the designated person leaves employment with the agency. Second, the clause must contain the phrase “and any other information required to be released by law. ” A provision that precludes an employer from releasing information required by law to be released will render the provision unenforceable.

Terminating the Employment Relationship ©2022 (s) Liebert Cassidy Whitmore 108