The Older Workers’ Benefit Protection Act (OWBPA) is an amendment to the federal Age Discrimination in Employment Act (ADEA). The ADEA makes it illegal for employers to discriminate against workers based on their age in all aspects of their employment, including when terminating or laying them off. It applies to companies with at least 20 employees and protects those who are 40 years old or older.
How Does the OWBRA Protect Workers?
The OWBRA provides older employees with protections against age discrimination in relation to their benefit packages. It also addresses issues when staff-cutting or early retirement programs are implemented and they are asked to waive their legal right to sue. Here are some of the requirements of this law:
● Benefits. An employer cannot discriminate on the basis of age when providing fringe benefits, such as life, disability, and health insurance, and retirement benefits, even if these benefits cost more for older workers. Benefits must be equal for all workers regardless of age. The rules applying to particular kinds of benefits are complicated, but an employment lawyer can help you understand them.
● Waiver rules. Some employers will offer a severance package as part of an early retirement or reduction-in-work-force program. Often these programs are targeted at older workers who receive higher pay and better benefits. In this situation, the employer often asks the individual to sign a waiver of the right to sue the company for age discrimination. Under the OWBRA, the employer must offer something of value in exchange for the waiver—not just wages already owed. In addition, certain language must be included in the waiver, and the employee must be given at least 21 days to decide whether to sign it.
● Even after the employee signs, the employee still has 7 days to revoke it.
● The employee can waive the 21 day review period by signing at any time during the 21 days, but the 7 day revocation period cannot be waived. This means the employer will not pay the severance or other value offered until the eighth (8th) day after it receives the employee’s signature.
Is your employer asking you to waive your right to sue as part of an early retirement or other employee-cutting program? You should not agree to this or sign any agreement without first having it reviewed by an experienced employment law attorney. Attorney Walt Taylor represents employees throughout the Dallas/Fort Worth area and is here to protect your interests and answer your questions. Schedule a free consultation with him by calling our office or starting an online chat.