Jeffrey Burke

In May 2024, U.S. Equal Employment Opportunity Commission (EEOC) enforcement made headlines, with numerous states challenging the recently updated EEOC harassment guidance and the EEOC cracking down on EEO-1 delinquent filings, while Starbucks’ labor woes continued.  Read about the details below.

18 State Attorneys General Assert EEOC Transgender Harassment Guidance Oversteps

Eighteen Republican state attorneys general, led by Tennessee, have filed a lawsuit against the EEOC, urging a federal judge to revoke recently finalized workplace harassment guidelines related to gender identity. The guidelines, issued in October 2023 and finalized in April, mandate employers to use employees’ preferred pronouns, allow transgender employees to use restrooms matching their gender identity, and prohibit dress codes based on biological sex. The states argue that the EEOC overreached its authority by issuing these protections, which they claim extend beyond the scope of the U.S. Supreme Court’s Bostock v. Clayton County decision, which held that terminating an employee based upon transgender status constitutes unlawful discrimination based upon sex under Title VII of the Civil Rights Act.  They further argue that the mandates contradict state laws and impose significant costs and irreparable harm. They contend that the EEOC lacks the authority to amend Title VII to include such gender identity accommodations, a task they believe should be reserved for Congress and the states. Tennessee Attorney General Jonathan Skrmetti described the EEOC’s actions as a misuse of federal power that undermines constitutional separation of powers and local governance, particularly regarding gender ideology and privacy concerns in schools and workplaces.

The case is State of Tennessee et al. v. Equal Employment Opportunity Commission et al., case number 3:24-cv-00224, in the U.S. District Court for the Eastern District of Tennessee.

EEOC Files Lawsuits Over EEO-1 Reporting Noncompliance

The EEOC initiated a series of lawsuits this month against companies in hospitality, transportation, food service, and construction sectors for failing to report required demographic data about their employees. Federal law mandates that businesses with 100 or more employees must annually submit workforce data to the EEOC, detailing job categories by sex, race, and ethnicity. This data aids in enforcement, research, and employer self-assessment.

The EEOC’s actions target firms in Alabama, Arizona, Florida, Georgia, Missouri, New Jersey, New York, North Carolina, Ohio, Texas, and Wisconsin, alleging noncompliance with EEO-1 report submissions for 2021 and 2022. Notable defendants include Transdev Services Inc., an Ohio-based auto parts dealer, and Primary Aim LLC, a Wendy’s franchisee. Despite notices, these companies failed to submit the required reports. The EEOC seeks court orders for compliance with past and future reporting obligations, with the 2023 EEO-1 report deadline looming on June 4.

The filings may signal a renewed effort by the EEOC to require employers to turn over pay information, and serves as a reminder to employers that EEO-1 reporting is more than a formality – the failure to comply can lead to legal consequences.

NLRB Judge Rules Starbucks Violated Labor Law by Banning Union Shirts While Allowing Other Logos

A National Labor Relations Board judge recently ruled that Starbucks violated federal labor law by preventing workers at its Staten Island, New York store from wearing union shirts, while allowing other non-standard attire. Judge Michael Silverstein noted that Starbucks’ claim of a strict dress code was undermined by its acceptance of shirts promoting various causes, such as Pride and Black Lives Matter, and themed attire for holidays and events.

The ruling followed a complaint from Workers United, which represented the employees after their union vote in September 2022. The dispute intensified when store manager Michelle DeAngelo enforced the dress code against union shirts and stickers about store closures, leading to unfair labor practice allegations.

The judge determined that the restriction on union shirts and stickers violated the National Labor Relations Act, as these were union activities protected by law. However, he dismissed one allegation due to insufficient evidence that Starbucks enforced its dress code more strictly for union apparel compared to other non-uniform clothing. 

The case is Starbucks Corp. and Workers United, case number 29-CA-305960, before the National Labor Relations Board Division of Judges.

Jeff Burke is an attorney at MacElree Harvey, Ltd., working in the firm’s Employment and Litigation practice groups. Jeff counsels businesses and individuals on employment practices and policies, executive compensation, employee hiring and separation issues, non-competition and other restrictive covenants, wage and hour disputes, and other employment-related matters. Jeff represents businesses and individuals in employment litigation such as employment contract disputes, workforce classification audits, and discrimination claims based upon age, sex, race, religion, disability, sexual harassment, and hostile work environment.  Jeff also practices in commercial litigation as well as counsels business on commercial contract matters.

April 2024 brought major pronouncements from the federal government that will affect employment nationwide, including the FTC’s controversial ban on non-compete agreements, and the EEOC issuing guidance on workplace harassment and a final rule implementing the Pregnant Workers Fairness Act. The details are below. 

FTC Issues Ban for Non-Compete Agreements Nationwide, but Challenges Loom

The Federal Trade Commission (FTC) issued a Final Rule this week to ban non-compete agreements, marking a significant shift in employment law nationwide.  The Final Rule is not an absolute ban, however the exceptions are narrow.  Some key takeaways from the Final Rule are:

• The Ban does away with all new post-employment non-compete agreements between employers and employees, regardless of industry or type of worker.
• The Ban allows existing post-employment non-compete agreements to remain in effect only for senior executives. A “senior executive” is defined as an employee “earning more than $151,164 annually who [is] in a policy-making position.”
• The Final Rule calls for notice to employees that previously executed post-employment non-compete agreements are no longer enforceable.
• The Ban creates an exception for the sale of a business, regardless of the ownership percentage.
• The Ban does not apply to franchisee/franchisor contracts (though the Ban does apply to employees working for a franchisee or franchisor).

The FTC rule isn’t set to go into effect until 120 days from the day it is published in the Federal Register, so likely not before September, 2024.  Moreover, less than 24 hours after the FTC issued the final rule, the US Chamber of Commerce filed a lawsuit against the agency in federal court in the Eastern District of Texas.  As such, the final impact of the Rule is yet to be determined.

Ultimately, employers may need to reassess their employment practices and consider alternative ways to protect their interests without resorting to non-compete agreements.  Meanwhile, employees may find themselves with greater freedom in their career paths. As this issue continues to evolve, both employers and employees should stay informed about their rights and responsibilities under the new regulatory landscape.

EEOC Issues Long-Awaited Updated Enforcement Guidance on Workplace Harassment

The U.S. Equal Employment Opportunity Commission (EEOC) has released its long-awaited final version of enforcement guidance on workplace harassment. This updated advice reflects contemporary developments, including the landmark Bostock decision by the U.S. Supreme Court and the increasing prevalence of remote work.

After a seven-year effort to modernize its harassment guidelines, the EEOC has crafted a comprehensive blueprint to combat workplace misconduct. This guidance replaces publications from the 1980s and 1990s, addressing topics such as the #MeToo movement and the Bostock v. Clayton County, Georgia decision, which affirmed protections against discrimination based on sexual orientation and gender identity under Title VII of the Civil Rights Act.

The document also addresses emerging issues like remote work, teleconferencing, and social media, recognizing that harassment can occur both in-person and online. Key provisions emphasize protections against intrusive questions about sexual orientation, gender identity, or intimate body parts, as well as the importance of providing access to “gender-affirming” workplace facilities.

While the guidance received support from Democratic commissioners, it faced opposition from Republican-appointed members who criticized its stance on gender identity and restroom policies. Despite dissent, the EEOC moved forward, drawing on extensive public feedback to refine the document.

The final guidance expands on the initial draft, providing detailed examples of harassment scenarios, particularly in virtual work environments. It highlights the persistence of harassment in remote settings, debunking the notion that telework would reduce misconduct.  Moreover, the document delves into intersectional and intraclass harassment, recognizing the complexities of mistreatment based on multiple protected characteristics or within shared identity groups. 

EEOC Issues Final Rule Implementing Pregnant Workers Fairness Act

The U.S. Equal Employment Opportunity Commission (EEOC) has unveiled its final rule implementing the Pregnant Workers Fairness Act (PWFA), marking a significant milestone in workplace protections for pregnant individuals and those with related medical conditions. The PWFA mandates that employers provide reasonable accommodations to pregnant workers, ensuring their safety and well-being without fear of job repercussions.

The EEOC’s final regulations, spanning over 400 pages, largely endorse a pro-worker interpretation of the law, aligning with its mandate to offer accommodations unless it poses an undue burden on businesses. The regulations, following a period of public comment, encompass a broad spectrum of conditions related to pregnancy and childbirth, including lactation, endometriosis, infertility, miscarriages, and notably, abortion.

While receiving bipartisan support upon enactment, certain aspects of the EEOC’s interpretation have sparked debate. Commissioner Andrea Lucas dissented due to concerns over the expansive definition of covered conditions, including abortion. Senator Bill Cassidy expressed opposition, deeming the inclusion of abortion illegal and divergent from congressional intent.

Conversely, Commissioner Kalpana Kotagal hailed the regulations as upholding hard-won rights, emphasizing the importance of not forcing pregnant workers to choose between health and employment. Dina Bakst of A Better Balance praised the regulations as robust, ensuring access to accommodations crucial for safeguarding the health and employment of millions, particularly those in physically demanding roles.

Jeff Burke is an attorney at MacElree Harvey, Ltd., working in the firm’s Employment and Litigation practice groups. Jeff counsels businesses and individuals on employment practices and policies, executive compensation, employee hiring and separation issues, non-competition and other restrictive covenants, wage and hour disputes, and other employment-related matters. Jeff represents businesses and individuals in employment litigation such as employment contract disputes, workforce classification audits, and discrimination claims based upon age, sex, race, religion, disability, sexual harassment, and hostile work environment.  Jeff also practices in commercial litigation as well as counsels business on commercial contract matters.

February 2024 was full of significant legal developments nationally and in Pennsylvania.  Labor advocates saw a victory in the national forum with student-athletes getting the right to unionize, a labor loss locally with the Pennsylvania Supreme Court reigning in the application of the Pennsylvania Prevailing Wage Act for a college construction project, and a notable ruling rejected protections under the Americans with Disabilities Act for medical marijuana patients. Read about it below.

National Labor Relations Board (NLRB) deems Players on Dartmouth College’s Men’s Basketball Team as Employees, Granting Them the Right to Unionize

In a significant development for college athletics, the National Labor Relations Board (NLRB) has deemed players on Dartmouth College’s men’s basketball team as employees, granting them the right to unionize. NLRB Boston office director Laura Sacks clarified that this decision aligns with a 2016 ruling acknowledging graduate student assistants’ unionization rights, asserting that the players’ activities benefit the institution and are compensated in non-traditional forms like admission aids and gear.

This ruling, subject to Dartmouth’s potential appeal, reopens the debate over whether college student-athletes qualify as employees under the National Labor Relations Act (NLRA), a question left unanswered since 2015. The filing of a union petition by the Service Employees International Union Local 560 signals a resurgence of interest in athletes’ labor rights, echoing past efforts at Northwestern University in 2014.

Sacks emphasized the athletes’ significant contribution to Dartmouth’s reputation and their adherence to institutional control, further solidifying their classification as employees. While the ruling doesn’t specify an election date, it sets a precedent for the evolving landscape of collegiate sports labor relations.

The case is Dartmouth College/Dartmouth College Board of Trustees and Service Employees International Union Local 560, case number 01-RC-325633, before the National Labor Relations Board Region 1.

PA Supreme Court Rules that Union-Friendly Prevailing Wage Act Rules Do Not Apply To Ursinus Bonds

In a landmark ruling, the Supreme Court of Pennsylvania has determined that bonds arranged by a government-created authority for the expansion of Ursinus College, a private institution in Pennsylvania, do not constitute “public funds.” The decision, authored by Justice P. Kevin Brobson, reinforces that the project financed by these bonds, despite the authority’s involvement, does not fall under the purview of the state’s Prevailing Wage Act (PWA).

The court emphasized that the funds used for the project were private in nature and were to be repaid by a private entity, precluding the application of prevailing wage rules. This ruling underscores the distinction between public and private financing, highlighting that the involvement of a government entity in facilitating financing does not automatically subject a project to prevailing wage requirements.

The decision marks a victory for Ursinus College and sets a precedent clarifying the interpretation of the PWA in similar contexts, providing clarity for future projects financed through similar arrangements.

The case is Ursinus College v. Prevailing Wage Appeals Board, case number 18 MAP 2023, in the Supreme Court of Pennsylvania.

Federal Court Rules that ADA Does Not Protect Medical Pot Use

In a recent ruling, U.S. District Judge Geoffrey W. Crawford addressed the complex intersection of state legalization of medical marijuana and federal employment law, particularly concerning the Americans with Disabilities Act (ADA). The case involved Ivo Skoric, a transit worker terminated for testing positive for marijuana despite having a medical prescription.

Judge Crawford’s decision underscored a crucial point: while states like Vermont have legalized medical marijuana, federal law, which classifies marijuana as a Schedule I substance, prevails. This classification, denoting “no currently accepted medical use,” effectively limits the ADA’s protection for individuals using medical marijuana.

The judge dismissed Skoric’s civil rights lawsuit against his employer, Marble Valley Regional Transit District, citing the ADA’s inability to support claims of discrimination in such cases. Additionally, claims against the Vermont Department of Labor were dismissed, with jurisdictional considerations playing a pivotal role.

Skoric’s case exemplifies the complexities individuals face when navigating conflicting state and federal laws regarding medical marijuana use and employment rights. This ruling highlights the pressing need for legislative clarity and underscores the ongoing legal challenges in this evolving landscape.

The case is Skoric v. Marble Valley Regional Transit District et al., case number 2:23-cv-00064, in the U.S. District Court for the District of Vermont.

Jeff Burke is an attorney at MacElree Harvey, Ltd., working in the firm’s Employment and Litigation practice groups. Jeff counsels businesses and individuals on employment practices and policies, executive compensation, employee hiring and separation issues, non-competition and other restrictive covenants, wage and hour disputes, and other employment-related matters. Jeff represents businesses and individuals in employment litigation such as employment contract disputes, workforce classification audits, and discrimination claims based upon age, sex, race, religion, disability, sexual harassment, and hostile work environment.  Jeff also practices in commercial litigation as well as counsels business on commercial contract matters.

The new year brought its fair share of controversy with a DOL worker classification rule that will impact employers nationwide, religious discrimination litigation over a local hospital’s COVID vaccine mandate, and a continued push for corporate DEI initiatives despite the Supreme Court’s decision striking down affirmative action university admissions.  See the latest below.

Department of Labor worker classification rule may dramatically alter the employment landscape nationwide

The U.S. Department of Labor (DOL) has unveiled its final rule on the classification of workers as independent contractors under federal labor law. The long-awaited rule, set to take effect on March 11, establishes a comprehensive six-factor test to determine whether a worker qualifies as an employee or an independent contractor. The factors include 1) the worker’s opportunity for profit or loss, 2) investments made by both the worker and the potential employer, 3) the degree of permanence in the work relationship, 4) the level of control the employer exercises, 5) the integral nature of the work to the employer’s business, and 6) the use of the worker’s skill and initiative.

Acting Labor Secretary Julie Su emphasized that the new rule aligns with the economic realities test developed by courts over decades, providing clarity and consistency in determining a worker’s status under the Fair Labor Standards Act. Su noted that misclassifying workers as independent contractors deprives them of essential benefits and protections required for employees.  Critics of the new rule argue that it will lead to reclassification of potentially millions of workers.  They largely point to the new (5^th) factor as a potential source of upheaval, as many historically independent workers provide services that are integral to the contracting company.

The rule rescinds a narrower independent contractor rule proposed under former President Donald Trump, which never went into effect. Despite positive reception from Democrats, Republicans have expressed opposition, with plans to introduce a Congressional Review Act resolution to repeal the rule.  The controversy surrounding the rule highlights the ongoing debate over the classification of workers and the potential impact on both employers and independent contractors.  The Rule is slated to take effect March 11, 2024.

Children’s Hospital of Philadelphia must face religious discrimination lawsuit over COVID vaccine mandate

The Children’s Hospital of Philadelphia (CHOP) faces legal proceedings as a former engineer, Donald Glover, claims the institution unlawfully rejected his request for a religious exemption from a COVID-19 vaccine mandate. U.S. District Judge Joel H. Slomsky ruled against CHOP’s motion to dismiss the lawsuit, emphasizing that Glover sufficiently demonstrated his objections were rooted in religious beliefs, specifically his Christian faith.

Glover, who opposed the vaccine due to his belief that his body is “God’s temple” and his objection to the use of fetal stem cells in vaccine research, cited the Book of Revelation in his plea for exemption. The court invoked the Third Circuit’s three-part test from Africa v. Commonwealth of Pennsylvania to establish the religious nature of Glover’s beliefs, emphasizing the fundamental and ultimate questions addressed by his Christian faith.

CHOP argued that Glover’s objections were philosophical rather than religious and based on a unique interpretation of a Bible passage. However, Judge Slomsky determined that Glover’s beliefs about the use of aborted fetal cells, the sanctity of human life, and the COVID-19 vaccine were cohesive with his two-decades-long Christian faith. The lawsuit proceeds, highlighting the intersection of religious beliefs, vaccine mandates, and employment rights.

The case is Glover v. The Children’s Hospital of Philadelphia, case number 2:23-cv-00463, in the U.S. District Court for the Eastern District of Pennsylvania.

Executives continue to champion DEI despite U.S. Supreme Court striking down affirmative action admissions

A report by Littler Mendelson PC reveals that despite the U.S. Supreme Court decision overturning race-conscious university admissions policies, nearly 70% of surveyed executives affirmed that their commitment to diversity, equity, and inclusion (DEI) remains unchanged. The survey, involving 322 C-suite executives, indicated that 57% of respondents observed an increased commitment to DEI in 2023. The Supreme Court’s June decision, impacting affirmative action policies at Harvard and UNC, did not deter 91% of executives from prioritizing DEI. However, 59% acknowledged a backlash against corporate diversity initiatives due to the ruling, and 6% reported some reduction in DEI programs since 2022. Concerns about legal liability, budget constraints, and lack of support from senior leaders were cited as reasons for scaling back DEI efforts. Discrepancies were noted between chief legal officers and chief diversity officers regarding perceptions of DEI programs, highlighting potential challenges in C-suite alignment on these initiatives.

Jeff Burke is an attorney at MacElree Harvey, Ltd., working in the firm’s Employment and Litigation practice groups. Jeff counsels businesses and individuals on employment practices and policies, executive compensation, employee hiring and separation issues, non-competition and other restrictive covenants, wage and hour disputes, and other employment-related matters. Jeff represents businesses and individuals in employment litigation such as employment contract disputes, workforce classification audits, and discrimination claims based upon age, sex, race, religion, disability, sexual harassment, and hostile work environment.  Jeff also practices in commercial litigation as well as counsels business on commercial contract matters.

In December 2023, the Delaware Chancery Court tees up a potentially major shift in non-compete disputes, Disney, Miramax and others try to distance themselves from Harvey Weinstein, and the 10^th Circuit sets limits to “reasonable” under ADA accommodation law.  See what happened at the close of the year below.

Delaware Chancery Court Urges Swift Appeal in Noncompete Dispute, Asserting “Unsustainable” Trend of Using Delaware Courts for Legal Disputes

The Delaware Chancery Court has recommended a midcase appeal to the state’s highest court in the dispute between Sunder Energy LLC and former executive Tyler Jackson. The court cites the need for guidance on “substantial” legal questions and expresses concern about the “problematic and unsustainable” trend of companies using Delaware’s legal system to bypass other states’ laws in noncompete disputes. Vice Chancellor J. Travis Laster ruled in favor of allowing Sunder to appeal the denial of a preliminary injunction to the Delaware Supreme Court, emphasizing the “substantial issue of material importance” involved. The dispute revolves around noncompete covenants in Delaware LLC agreements and highlights the growing reluctance of the Chancery Court to modify such clauses. The case raises questions about whether the nearly 2 million businesses chartered in Delaware can rely on the state’s courts to enforce restrictive provisions. The court acknowledges the conflict between Delaware’s interests and the individual interests of clients and their lawyers in using Delaware’s legal regime for resolving disputes.

The case is Sunder Energy LLC v. Tyler Jackson et al., case number 2023-0988, in the Court of Chancery of the State of Delaware.

Disney and others Move to Dismiss Negligent Supervision Case relating to Harvey Weinstein Assault

In a legal battle related to Harvey Weinstein’s alleged sexual assault on actress Julia Ormond in 1995, The Walt Disney Co., Creative Artists Agency (CAA), and Miramax are jointly seeking dismissal of the lawsuit. Weinstein, the former co-chairman of Miramax, is serving a prison sentence for sexual assault convictions. Ormond claims that Disney, CAA, and Miramax did not protect her from Weinstein’s abuse.

The defendants argue that they are not responsible for the alleged assault, with Disney asserting that Ormond failed to demonstrate that Weinstein was a Disney employee or that the company had direct control over him. Disney contends that Miramax and Disney were separate entities, emphasizing the critical distinction between them.

Ormond, a well-known actress in the 1990s, asserts that she signed a production deal with Miramax without being warned about Weinstein’s predatory behavior. She alleges that her agents and CAA were aware of previous settlements but did not inform her. The lawsuit, filed under New York’s Adult Survivors Act, includes claims of battery against Weinstein, negligent supervision and retention against Miramax and Disney, and negligence and breach of fiduciary duty against CAA.

Disney argues that it cannot be held liable for Weinstein’s actions as he was not its employee, and it was unaware of his past misconduct. Miramax and CAA also challenge the sufficiency of the allegations against them, denying negligence and arguing that they had no knowledge of Weinstein’s history before the assault. The legal battle underscores the complex issues surrounding corporate responsibility and accountability in cases of sexual misconduct.

The suit is Julia Ormond v. Harvey Weinstein et al., case number 952107/2023, in the Supreme Court of the State of New York, County of New York.

Request for “Open-ended” leave Too Unreasonable for ADA Protection

In a recent decision, the Tenth Circuit upheld the dismissal of a former casino worker’s Americans with Disabilities Act (ADA) lawsuit, stating her accommodation request for managing asthma attacks was “unreasonable.” Danielle Davis, a table-games dealer, sought accommodations allowing her to miss work during asthma flare-ups and to erase attendance points accumulated due to previous health-related absences. The court rejected her claim, deeming the request for “open-ended” leave incompatible with the essential job function of regular attendance. Davis argued against the importance of attendance in her role, but the court cited the casino’s vice president of human resources, emphasizing its critical role in the core gambling service. The decision highlights the need for employees to demonstrate that attendance expectations are non-essential by proving inconsistent enforcement or lack of business necessity, which Davis failed to do. Additionally, the court rejected Davis’s plea to erase attendance points, stating that ADA does not mandate disciplinary record resets predating accommodation requests. The panel also declined to revive her disability bias claim, emphasizing her termination’s alignment with company policies rather than prejudice.

The case is Davis v. PHK Staffing, case number 22-3246, in the U.S. Court of Appeals for the Tenth Circuit.

Jeff Burke is an attorney at MacElree Harvey, Ltd., working in the firm’s Employment and Litigation practice groups. Jeff counsels businesses and individuals on employment practices and policies, executive compensation, employee hiring and separation issues, non-competition and other restrictive covenants, wage and hour disputes, and other employment-related matters. Jeff represents businesses and individuals in employment litigation such as employment contract disputes, workforce classification audits, and discrimination claims based upon age, sex, race, religion, disability, sexual harassment, and hostile work environment.  Jeff also practices in commercial litigation as well as counsels business on commercial contract matters.

Employee severance agreements are becoming increasingly common in the modern workplace. With the ever-changing business landscape, companies often find themselves having to restructure, downsize, or lay off employees.  Employers often find themselves in situations where they have to navigate separating from problematic employees.  Conversely, employees sometimes find themselves victims of problematic and potentially unlawful employment practices and have to part ways with their employer.  In such situations, severance agreements can help protect the interests of both the employer and the employee.

Drafting an effective severance agreement requires a thorough understanding of the relevant laws and legal issues. Unfortunately, I have seen numerous instances where employers have failed to properly draft these agreements, leaving them vulnerable to legal challenges; or, employees have signed questionable severance agreements that lack the proper benefits or legal protections.  In this article, I will provide 4 things to know when facing an employee severance situation.

1. Consideration: The agreement must provide adequate consideration to the employee. This typically takes the form of a lump sum payment or salary continuation for a specified period, but can also include other forms of compensation such as continued health insurance coverage, outplacement services or other benefits.  If the agreement only provides benefits to which the employee is already entitled, it lacks consideration and will not be enforceable.
2. Non-compete, non-solicitation, and non-disclosure clauses: Non-compete, non-solicitation, and non-disclosure clauses can be included in severance agreements to protect the company’s clients, trade secrets, and proprietary information. However, such clauses must be carefully crafted to ensure that they are reasonable in terms of scope and duration.  In addition, non-disclosure clauses must comply with state and federal laws, including the National Labor Relations Act, which protects employees’ rights to engage in protected concerted activity.
3. Waivers of rights and releases of claims: The agreement typically also includes a release of claims against the company along with waivers of the employee’s rights to bring legal action against the company. This means that the employee is giving up his or her right to sue the company for any claims arising out of their employment.  However, there are limits to what can be released, and certain claims such as workers’ compensation or unemployment benefits cannot be waived.  Waivers must be drafted in a clear and specific manner, and must comply with state and federal laws.
4. Proper execution: The agreement must provide the employee with adequate time to review and execute the agreement.  For certain severance agreements, allowing up to 21 or even 45 days is required.  In addition, certain severance agreements must allow the employee a 7-day window to revoke the agreement after he or she signs it.

Drafting an effective employee severance agreement requires a thorough understanding of the relevant facts and legal issues. The agreement should be tailored to the specific needs of the company and the employee, and should be drafted in compliance with state and federal laws.  The best way to ensure these goals are accomplished is to consult with a qualified attorney.

Jeff Burke is an attorney at MacElree Harvey, Ltd., working in the firm’s Employment and Litigation practice groups. Jeff counsels businesses and individuals on employment practices and policies, executive compensation, employee hiring and separation issues, non-competition and other restrictive covenants, wage and hour disputes, and other employment-related matters. Jeff represents businesses and individuals in employment litigation such as employment contract disputes, workforce classification audits, and discrimination claims based upon age, sex, race, religion, disability, sexual harassment, and hostile work environment.  Jeff also practices in commercial litigation as well as counsels business on commercial contract matters.