Employment & Labor Insider

A federal court is allowing a plaintiff who was fired while in his 80s to get to a jury on his age discrimination claim.

The facts are complicated, so I won't go there. But the plaintiff had an interesting theory. He argued that the employer’s alleged failure to comply with the Older Workers Benefit Protection Act was part of a "convincing mosaic" of evidence supporting his claim.

As you know, agreements with individuals who are 40 or older must comply with the OWBPA. Or they do if you don't want to be sued for age discrimination after paying out a nice severance package.

Our plaintiff (we’ll call him “Waldo”) was initially hired in 1965. (1965!) In 2024, he was terminated for allegedly poor performance.

 Not our Waldo.

Waldo’s supervisor wanted to put him on a Performance Improvement Plan. The supervisor's boss suggested offering Waldo a separation agreement that would allow Waldo to retire "with dignity" and a clean disciplinary record. I'm sure the boss meant well. 

The supervisor and a different manager met with Waldo on a Friday. They gave Waldo a separation agreement. They also offered the PIP option but did not have a PIP drafted. They told Waldo to go home that day and let them know on the following Monday -- three calendar days later -- whether he would stay on with the PIP, or whether he would quit.

The written agreement itself complied with the OWBPA, and said that Waldo had 21 days to “consider” the agreement and seven days to revoke his signature after he had signed, assuming he did.

But giving the employer every benefit of the doubt, Waldo misunderstood his bosses to be telling him that he had to sign the agreement in three days if he elected to leave.

After the termination meeting, Waldo asked his direct supervisor whether he would be fired even if he took the PIP option. The supervisor allegedly replied that it was a “good possibility.”

Waldo signed the agreement within the three-day period. Less than seven calendar days after that, he revoked his signature.

He then filed age discrimination charges with the Equal Employment Opportunity Commission and the Florida Commission on Human Relations. The Florida agency found in Waldo's favor.

Also not our Waldo.

Then Waldo sued. The employer filed a motion for summary judgment. And in a decision issued earlier this week, the court ruled that Waldo would get a jury trial on his age claims.

There were a lot of reasons for the court's ruling. But, interestingly, Waldo alleged that one "tile" in his "convincing mosaic" was that he was not given 21 days to “consider” the separation agreement, as required for a valid waiver of age claims under the federal Age Discrimination in Employment Act.

As far as the agreement was concerned, this was a moot point because Waldo validly revoked his signature after he signed. In other words, after the revocation, there was no agreement anyway.

But the decision gives us a good excuse to review the OWBPA requirements, and also to look at how this employer might have handled things better.

OWBPA requirements

For a separation agreement involving anyone who is 40 or older, federal law requires the following:

• That the employee be given 21 days to “consider” the agreement.
• That the employee be advised of his right to consult with an attorney.
• That the employee be advised that he is waiving claims under the ADEA, among other claims.
• That the employee be given seven calendar days to revoke his signature after he signs, assuming he signs.
• That the employee be advised that he is not waiving claims related to anything that happens after he signs the agreement.

IMPORTANT: In the case of a "group termination" -- meaning termination of two or more employees as part of a single event or series of events -- the "consideration" period is 45 days, and there are other requirements as well.

If you don’t have the required terms in your separation agreement, the release may still be valid with respect to other claims, but not with ADEA claims.

In the real world, the employer usually terminates the employee effective immediately but gives the employee the full 21 days or more post-termination to consider the agreement. Pretty straightforward.

Waldo's in here . . . somewhere.

In this case, the employer may have confused things by offering the PIP option. As a result, here is what Waldo heard:

You can stay on and accept the PIP. You may get fired anyway. OR you can quit right away and take the severance package. If you want that, let us know by Monday.

Could this have been handled better? Probably.

Here is a example of how the PIP/termination options could have been handled with less confusion. And I would have put it in writing, so there would be no question about what was said.

In the sample below, I chose roughly five weeks so that the employee would be sure to receive the full 21 days required by the OWBPA, plus a small cushion.

February 23, 2024

We will be putting you on a four-week [paid/unpaid/PTO -- my preference would be "paid"] leave of absence effective today. The leave will end on March 31. While you are on leave, you have three options to consider:

OPTION 1: You can return to work, but we will need to put you on a Performance Improvement Plan. If you don’t improve enough, we will terminate your employment. If you choose this option, you will need to let us know on or before March 31.

OPTION 2: You can resign with a separation agreement. If you accept the agreement, you will receive X months’ pay and continuation of your group health insurance for that X-month period. In exchange you will give us a release of claims. Here is the agreement. By law, you have 21 days to consider the agreement and consult with an attorney of your choice, among other rights. If you have not returned to work and we have not heard from you about the agreement by March 31, we will assume that you have chosen Option 3, described below.

OPTION 3: You can resign without a separation agreement. If you do not accept the agreement, you will not receive separation pay and we will not pay your health insurance premiums after March 31. Again, if we have not heard from you by that date, we will assume you have chosen this option, and we will terminate your employment.

If you choose Option 2 or Option 3, our records will reflect that you voluntarily resigned (or retired, if you prefer to have us say that), and that is what we will tell your co-workers. But we will provide truthful information to the state unemployment agency so that you will still be eligible to receive unemployment benefits.

Pro tip

If you anticipate terminating an employee who is in his 80s, you might not want to call him “Grandpa” in a meeting three weeks before the termination.

Allegedly.