EEOC Final Regulations On Legality Of Waivers Under The ADEA
Effective January 11, 2001, the new EEOC regulations address the “tender back” issue of waivers under the Age Discrimination in Employment Act (ADEA). The regulations affirm an employer cannot restrict an employee’s right to challenge a waiver under the ADEA. This position was upheld by the Supreme Court in the 1998 case Oubre v. Entergy Operations, 522 U.S. 422 (1998). In that case, the Supreme Court held employers could not require employees to “tender back” payments or benefits that were given in exchange for a waiver agreement, before the employee challenges the legality of the agreement in court.
Employers will be permitted to recover attorneys’ fees from an employee who brings suit in bad faith. In appropriate circumstances, the employer also will be able to receive a setoff against an employee’s recovery if the employee received consideration from the employer in exchange for a waiver agreement ultimately found invalid. However, even if an agreement is found invalid with respect to one or more employees, the employer must still honor that agreement as it exists with other employees.
Included in the regulation is a comprehensive review and discussion of public comments. Aside from waivers, covenants not to sue and other agreements are also addressed. In the commonly used question and answer format, a “Fact Sheet on Waivers,”explains waivers under the ADEA. Questions include:
- What is a waiver under the ADEA?
- Why did the EEOC issue the regulation?
- What are the main points of the regulation?
- What are the specific circumstances in which an employer can get back money it paid for an ADEA waiver?
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