Complexities of the Older Workers Benefit Protection Act

As baby-boomers retire, Gen X managers take the reins of many companies, and millennials are hired each day, questions often arise regarding age discrimination. It may sound strange that Gen X, the grunge-rock generation of people born between 1961 and 1981, could suffer from age discrimination, but employers should be aware that the Older Workers Benefit Protection Act, or OWBPA, covers all employees over the age of 40. The OWBPA guarantees all employees aged 40 or older benefits such as severance pay and protection from being pressured into signing severance agreements. Employers frequently come to us after a former employee files an OWBPA claim; all too often, these claims were avoidable if the employer had simply attained advice before taking employment action.

Do you need experienced business and human resources counsel to guide you through a challenging workplace situation? You can avoid severe business disruption by proactively contacting experienced counsel before a layoff or termination. For a free initial consultation, contact SAC Attorneys LLP today at (408) 436-0789.

As an overview, the OWBPA prevents employers from (1) Using an employee’s age as grounds for termination; (2) Targeting older workers for layoffs, early retirement plans, or reductions in force; (3) Forcing workers 40 or over to sign a waiver of age discrimination claims without consideration. To avoid allegations that an employer violated one of those three prohibitions, always attain legal help to draft an OWBPA-compliant release before ending the employment of an employee aged 40 or older. An OWBPA-compliant release will always be written, use simple language, encourage the employee to attain his or her own legal advice regarding signing the release, and provide 21 days for consideration of the release and an additional seven days to revoke their consent. Separate consideration, or benefits, must support the worker signing the release. SAC Attorneys LLP often sees unearned bonus money, unearned vacation or sick pay, extended health benefits, and relocation expenses used as consideration to support these agreements. Determining whether your proposed employment action, accompanying release, and supporting consideration are legally sufficient requires a complex legal analysis. Call SAC Attorneys LLP before taking any steps.

If a layoff or retirement incentive program is going to affect two or more employees over 40 years old, special requirements apply. The rationale behind these requirements is that older workers deserve to know whether the layoff is aimed at older workers and whether they are being treated fairly. As a result, the OWBPA requires the employer to provide affected employees over 40 with information regarding all employees that were offered severance packages and were asked to sign a release of age discrimination claims. Specifically, the employer must detail ages and job titles of all the employees being terminated, the ages of all employees being retained, and any eligibility factors and time limits applicable for the termination this offer. Instead of the usual 21 day consideration period discussed above, these employees involved in a group action receive 45 days to consider any termination offer made to them.

How should your company proceed if layoffs are on the horizon and your workforce contains employees over 40 years old? If you mishandle the termination, layoff, or retirement program, you will likely face legal claims brought under the OWBPA. Attain expert legal counsel now.

For a free initial consultation, contact SAC Attorneys LLP today at (408) 436-0789. Based in San Jose, California, the firm represents clients in Silicon Valley, San Jose, Mountain View, Los Gatos, Cupertino, Fremont, Palo Alto, Santa Clara County, and around the world.

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• TITLE I--OLDER WORKERS BENEFIT PROTECTION