Separation Anxiety: Best Practices for Employee Severance Agreements
Employers deal with employee separations all the time. Back when I was an HR manager for a major airline, when it came time for a layoff or other not-for-cause termination, most of the time I'd just pull the standard form separation agreement off the shelf, customize it a bit, and then work to get the employee to sign it. I confess that I never gave much thought to whether the separation agreement could ever be challenged, or worse, determined to be unenforceable.
Now I know better. While form agreements are certainly convenient, they can easily become outdated by failing to account for recent developments in the law. With the new year underway, now might be a good time to review your form separation agreements and decide whether a tweak or two is in order. Why now? Recently, the EEOC, SEC, and other government agencies have started to take a more aggressive stance on separation-agreement provisionsparticularly those that are seen, at least from the agencies' points of view, as preventing or deterring employees from reporting employer wrongdoing.
For example, the EEOC has long taken the position that conditioning severance benefits on the employee's promise not to file an EEOC charge could constitute unlawful retaliation, in violation of federal employee-rights statutes.1 But in a recent shift, the EEOC has become even more strident in its enforcement efforts, and the agency has taken action against even those employers whose severance agreements expressly carve out restrictions on...
