Who’s covered? Generally, employers with more than 20 employees.
Who’s protected? Employees over 40 who are being terminated voluntarily or involuntarily, and who are asked to release any age discrimination claims they may have in exchange for some consideration—usually, severance pay.
That’s complicated. What else? There’s more required when a group termination occurs. If an employer carries out a reduction in force or offers a group of employees a termination incentive program, and even one of the affected employees is over 40, there are additional notice and consideration period obligations:
- All of the requirements listed above have to be met;
- Each employee, regardless of age, has to be given 45 days to consider the proposed release before signing it; and
A “group” termination program subject to the OWBPA’s enhanced notice requirements occurs whenever more than one employee is terminated during a six-month period as part of the same decision-making process.
What’s the penalty for failure to follow OWBPA requirements? It’s an invalid, unenforceable release. If an employer neglects or fails to do what the OWBPA requires, any release signed by a protected employee is void as to ADEA claims. Non-ADEA claims are not affected, but an employer may face a federal age discrimination claim even though the employee has been paid to release such a claim.
Is that it? Like all anti-discrimination laws, the OWBPA and the ADEA are dense, detailed statutory provisions. What we’ve included here are the basics, but you may need to know more if you’re facing a reduction in force or even the termination of a single employee over 40. It will be worth the effort to dig into the law or get expert advice, because the price of non-compliance can be very high.