A survey conducted by the Equal Employment Opportunity Commission revealed that approximately 60% of employees over the age of 45 have experienced or witnessed some form of age discrimination. There are many ways in which this discrimination can manifest, including older employees not being offered the same benefits as their younger coworkers. Older employees are also often targeted for layoffs and termination during which they are asked to sign a release waiving their right to sue. The Older Workers Benefit Protection Act (OWBPA) is a federal law meant to safeguard employment benefits for older employees and protect them from being taken advantage of.
The Older Workers Benefit Protection Act was added to the Age Discrimination in Employment Act in 1990. The purpose of this act was to specify the responsibilities of employers in regard to providing employment benefits to Employees who are 40 years of age or older. It also specifies guidelines for requesting an employee to waive their right to sue for age discrimination. Employers are prohibited from forcing or pressuring employees to waive those rights. The OWBPA requirements ensure that employees over 40 are given adequate time to make an informed decision before signing a severance agreement and that the agreement includes specific benefits and pay for the employee.
Even after the ADEA was implemented in 1967, employers were still taking advantage of older employees. People were being forced to retire and coerced into signing agreements not to sue for age discrimination. As a way to further reduce instances of this discrimination, the OWBPA was implemented in 1990. The act specified the rights of older employees as well as the restrictions imposed on their employers. Together, the ADEA and the OWBPA have made great progress in helping to protect the rights of older employees throughout the country.
Much like the ADEA, the OWBPA protects employees who are 40 years of age or older. The act applies to employers with at least 20 employees. The ADEA and the OWBPA do not protect employees under 40 from age discrimination. Another similarity to the ADEA is that the OWBPA is a federal law and different states may have their own laws in addition to federal regulations. It is important to know what specific rights and protections you have in your individual state.
Age discrimination can also go hand in hand with gender and disability discrimination as well. Older female employees are sometimes told that they have less value than their younger female coworkers. Older employees with disabilities, illnesses, and injuries may face more difficulty in receiving accommodation or time off. They may also be more likely to be pressured into early retirement.
The OWBPA is meant to help safeguard the rights of employees over the age of 40 and protect them from age discrimination in the workplace. The act prohibits employers from taking actions such as:
The OWBPA imposes guidelines and regulations on the steps an employer must take when terminating or laying off an older employee to ensure that they are offered appropriate benefits and given the time to make an informed decision when waiving their right to sue.
Employers are not permitted to discriminate against older employees when offering benefits such as:
Older employees must be offered the same benefits that are offered to younger employees unless the employer can prove that there are significant expense considerations that support reduced benefits. There are also some instances where older workers may end up with lower benefits than younger workers which can be legally acceptable if the employer spent the same amount of money on both. On some occasions, employers may be permitted to offer an older employee reduced benefits if the employee is also receiving assistance through other benefits or government aid.
There are many rules pertaining to layoffs, including restrictions to protect against age discrimination. Employers may be tempted to focus on older employees when making layoff decisions because they are likely making the most money. If a layoff consists of only or mostly employees over 40, the company risks being sued for age discrimination. In order to avoid this, many employers will offer a severance package including pay and benefits in exchange for the employee signing an agreement waiving their right to sue. In order to prevent employers from pressuring or coercing older employees into signing these agreements without fully understanding them, the OWBPA requires employers to give older employees at least 21 days to review the agreement and make a decision. In the case of multiple older workers being let go at once, they must be given at least 45 days to review the agreement. The employee then has 7 days after signing in which to change their mind and revoke the agreement.
Not only are there regulations surrounding the signing of these waivers, but there are specific things that must all be included within the agreement itself.
If the agreement is for multiple employees, it must include:
When an employer wants to end an employment relationship and wants to guarantee that the employee will not take legal action against them, they may offer a severance package in exchange for the employee agreeing to terms that include waiving their right to sue. This package can include things like extra money, extended benefits, relocation expenses, or perks such as keeping company issued property. Some employers may be willing to agree to more in order to get the employee to sign. The OWBPA gives older employees the time to have the agreement reviewed and consider all of their options.
There are additional regulations in place for when an employer decides to lay off a group of employees who are all 40 or older. The minimum length of time for the employees to review the severance agreement is extended to 45 days and they must be provided with:
These regulations apply whether the employees are laid off all together at once or spread out over time under the same decision. These regulations ensure that employees are able to make an informed decision before signing a waiver or taking legal action. It also gives the employees the opportunity to seek each other out and discuss their options as a group before deciding how to move forward.
The Equal Employment Opportunity Commission oversees and enforces employment laws pertaining to discrimination and harassment including the Older Workers Benefit Protection Act. When an employee is terminated or laid off because of their age, or if the employer does not adhere to the regulations in place regarding severance agreements and waivers, they can file a claim with the EEOC. They will then investigate and attempt to resolve the matter. If they are unable to do so, they may issue a Right to Sue letter allowing the employee to file a lawsuit. It is generally in the employee’s best interest to seek a consultation from an attorney.
There are many federal and state laws outlining the obligations and responsibilities of employers as well as the rights and available courses of action for employees. Every situation is unique, and it is common for employees to not have all of the facts necessary to make an informed decision. An employment attorney can go over the details of your situation and explain your rights and options. Many attorneys offer additional services for reviewing severance agreements. They will explain the contents of the document, point out areas that are not in your best interest, advise on where you might want to negotiate for more, and answer any questions you may have. If you decide to take legal action instead, having a lawyer alleviates much of the stress of filing a lawsuit and can make the entire process less overwhelming. They will be with you every step of the way, handling paperwork, answering questions, and fighting to give you the best possible outcome.