Severance Agreements

News & Analysis as of

Employment Law Issues in Mergers and Acquisitions

Last week, Microsoft announced its purchase of LinkedIn for $26.2 billion. This acquisition is interesting for a number of reasons, and is very likely to affect the future of professional social networking. It also got us...more

IRS Issues Regulations Affecting Compensation Arrangements at Tax-Exempt Organizations

On June 21, the IRS issued long awaited proposed regulations under Section 457 of the Internal Revenue Code that affect a broad range of compensation arrangements at tax exempt organizations. If a compensation arrangement is...more

Flexibility Offered for Deferred Compensation Plans of Tax-Exempt Organizations, Government Agencies

The U.S. Treasury Department has issued two sets of proposed regulations, under Sections 457 and 409A of the Internal Revenue Code, relating to deferred compensation plans of state and local governments and tax-exempt...more

New Jersey Rejects Contractual Shortening of Limitations Period

The New Jersey Supreme Court’s decision forbids employers from contractually shortening the two-year limitations period under the state’s Law Against Discrimination. In a decision issued on June 15 that reversed two...more

Employers Cannot Shorten Time Frame to Bring Claims Under N.J. LAD

In a decision issued yesterday in Rodriguez v. Raymours Furniture Company, the Supreme Court of New Jersey ruled that provisions in employment agreements shortening the limitations period for bringing claims under the New...more

Statute of Limitations for New Jersey Law Against Discrimination Claims Cannot Be Shortened By Contract

Seyfarth Synopsis: The Supreme Court of New Jersey rules that employers may not shorten the statute of limitations for claims of discrimination under the New Jersey Law Against Discrimination via private contract. The...more

Court Upholds Non-Compete Giving Former Employer Discretion To Determine Whether Ex-Employee Is Working For A Competitor

A severance agreement executed in connection with a Stark Truss employee’s resignation included a one-year non-competition clause. It allowed the company unfettered discretion to decide if his new employer was a competitor...more

What Is Knowing and Voluntary? One Court’s Take on the Enforceability of ADEA Waivers

A recent district court opinion in Romero v. Allstate Insurance Company, et al., 2016 WL 2619853 (E.D. Pa. May 4, 2016), underscores that there is not a “one-size-fits-all” approach for employers seeking “knowing and...more

Non-compete Restrictions in Texas Severance Agreements

One of the most frequent Texas non-compete questions I am asked is whether an employee and employer can enter an enforceable non-compete agreement at the time of termination. From the employee's perspective, this seems...more

A Quick Guide to the Taxation of Retiring Allowances

When an employee’s employment is terminated without cause, the employee will typically receive some form of a termination/severance payment. All or part of this termination/severance payment may be considered a “retiring...more

Hutchison v. Shull: Expanding Iowa’s Open Meeting Law (Part 1)

Warren County is governed by a three-member Board of Supervisors. The supervisors asked the Warren County Administrator to assist the Board in their stated goal of improving the efficiency of the county government. To that...more

Consider Liquidated Damages to Deter Employees From Misappropriating Company Information

It is not unusual for employment agreements to mandate that when an employee leaves a company, whether voluntarily or by termination, he or she must return all company information. As the employer in EventMonitor v. Leness...more

Utah Enacts Post-Employment Restrictions Act

A growing number of states are tightening conditions on restrictive covenants.  The start of 2016 saw Oregon and Alabama enact higher barriers to the enforcement of non-compete agreements in those states. As of March 22,...more

New Utah Law Limits Restrictive Covenants to a One-Year Period

On March 9, 2016, Utah enacted the Post-Employment Restrictions Amendments, which limits restrictive covenants to a one-year time period from termination. Any restrictive covenant that is entered into on or after May 10,...more

Employment Law Commentary - Volume 28, Issue 2 - February 2016

Separation Anxiety: Best Practices for Employee Severance Agreements: Employers deal with employee separations all the time. Back when I was an HR manager for a major airline, when it came time for a layoff or other...more

How to Fire Your Employee Without Getting Sued

Before I even begin this post, let me advance the disclaimer right off the bat: Despite the title of this post, there is no sure-fire way to fire an employee without getting sued. Indeed, the title is a bit of a...more

Labor & Employment E-Note - February 2016

The U.S. Department of Labor ("DOL") recently announced that its long awaited changes to the federal overtime regulations will be published in July 2016. The revised regulations, which were first discussed in March 2014, are...more

Continued Employment is Enough for a Severance Agreement

Here’s one where the tables were turned. Former employees often argue that a non-compete agreement is unenforceable because there was inadequate “consideration.” Consideration is the exchange parties to a contract make, what...more

Stop Trade Secret Thieves Before They Leave

One of the most likely times to lose trade secret protection occurs when an employee leaves the company. If there are feelings of resentment, the employee may want to harm the employer, or the employee may mistakenly feel...more

Seventh Circuit Affirms the Dismissal of Lawsuit Based on the EEOC's Failure to Conciliate Claims Related to Releases

On December 17, 2015, the U.S. Court of Appeals for the Seventh Circuit affirmed a district court’s dismissal of the Equal Employment Opportunity Commission’s lawsuit against CVS Pharmacy.  This lawsuit has been the subject...more

SEC Whistleblower Report Shows Increase in “Tips”

The Securities and Exchange Commission’s (SEC) Office of the Whistleblower (Office) recently released its 2015 Annual Report on the Dodd-Frank Whistleblower Program (Report) (November 16, 2015)....more

Seventh Circuit Tosses EEOC Lawsuit Challenging CVS Severance Agreements Due to Failure to Conciliate

Last month, the Seventh Circuit again rejected the Equal Employment Opportunity Commission’s attempt to declare an employer’s standard severance agreement illegal under Title VII. The EEOC and CVS Pharmacy have clashed over...more

EEOC Must Conciliate, But Still Few Answers Regarding Routine Separation Agreement Provisions

In February 2014, the EEOC sent waves through employer communities when it filed a lawsuit against a national retail pharmacy contending some of the company’s separation agreement provisions — which many considered “standard”...more

Seventh Circuit Rejects EEOC’s Attack on Severance Agreements

On December 17, 2015, the U.S. Court of Appeals for the Seventh Circuit upheld the dismissal of a lawsuit by the EEOC against CVS Pharmacy, Inc. In Equal Employment Opportunity Commission v. CVS Pharmacy, Inc., the EEOC...more

Seventh Circuit “Releases” CVS From EEOC’s Separation Agreement Attack

As we previously blogged about, the EEOC has gone on the offensive challenging employer severance agreements. In one such case, the EEOC attacked CVS Pharmacy Inc.’s standard release agreement which contained terms more...more

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