The EEOC has been challenging the legality of releases, attacking certain language that some employers consider standard.  The EEOC responds that it is merely acting consistently with its 1997 Enforcement Guidance on what it considers “non-waivable rights.”  So, what has drawn the EEOC’s adverse attention?  Here is a brief overview:

  • Covenants not to sue which include an employee’s agreement not to file a charge of any kind;
  • General release language that includes charges of any kind, including any discrimination charges.
  • Confidentiality clauses, along with non-disparagement clauses, that include the obligation of the former employee to notify the Company before sharing any information, even if required by subpoena to disclose information.

Employers should include the necessary carve-outs in these releases:

  • Any covenant not to sue or general release should include a carve-out that the covenant does not prevent the employee from filing a charge; the language in the carve-out also should indicate that the employee does waive the right to recover any  monetary damages in any charge or lawsuit brought on the employee’s behalf;
  • A confidentiality clause likewise should have a carve-out that the language does not prevent the employee from participating in an investigation.

Given the EEOC’s more aggressive approach, it is wise for employers to have their current releases reviewed by competent legal professionals familiar with this trend.