Lou Michels and Rod Satterwhite are partners in the Labor & Employment group at McGuireWoods LLP. Both handle employment litigation on behalf of employers, and advise companies on employment issues regularly.
posted on Tuesday, May 30, 2006 3:31 PM by Lou Michels

The Older Workers Benefits and Stereotyping Act

Perhaps my all-time favorite employment statute is the Older Workers Benefits Protection Act, which defines the requirements for waivers for age discrimination claims.  Rarely does one find such an explicit statutory validation for stereotyping an increasingly larger segment of the population, namely, the elderly. 

Let's jump through the hoops (or, given the context, let's shuffle along the sidewalk) -- Congress passed the ADEA in 1967 to protect people over 40 (otherwise known as the aged or elderly) from being stereotyped as easy to mislead, unable to understand modern concepts, and generally slow on the uptake.  Some 23 years later, Congress enacted a special amendment to the ADEA--the aforementioned Older Workers Benefits Protection Act -- that required age discrimination waivers for covered employees to be written in simple language that told the recipient to consult an attorney, provided at least 21 days to consider the waiver, and gave an unprecedented 7-day period to revoke acceptance of a waiver.  These explicit terms are found nowhere else in employment discrimination law.  Why?  Presumably because Congress believed that older employees are easily misled, have difficulty understanding modern concepts, and are generally slow on the uptake.  In other words, the OWBPA confirms the stereotype that the ADEA states employers specifically may not have.

OWBPA waiver cases typically turn on whether the waiver agreement or release contains the express terms required by the statute.  The 8th Circuit recently reviewed one of these terms, that the agreement be "written in a manner calculated to be understood" by the waiving employee.  In this case, the employee signed a release agreement and then attempted to void the release and sue for age discrimination.  He argued that the waiver of age discrimination claims was invalid because a forfeiture provision in the agreement penalized the employee if the employer had to bring an action to enforce the agreement.  His theory was that there was a contradiction between the paragraphs of the agreement, and therefore the agreement was not written in a manner calculated to be understood by the employees at issue.  Never mind that the employee never raised a question concerning this supposed inconsistency, or otherwise expressed confusion about its terms, the court was to do a post hoc review to see if the language was intelligible.

But not so fast, the release also had an explicit exception to the penalty provisions for age discrimination cases.  The court unanimously found that the express removal of age discrimination claims from the penalty provisions meant that the release was compliant with OWBPA requirements, and therefore could be understood by the average waiving employee. 

The moral here, of course, is clear.  Follow the express requirements of the statute—they are a minimum for enforceability

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