HR Solutions: Waivers can help protect businesses from lawsuits

Lynne Haggerman is president/owner of Haggerman & Associates, a firm providing outplacement, retained search and management consulting/training on human resource issues.

Editor's note: This is the first in a two-part series related to layoffs in tight economic times and what companies can do to protect themselves. Next week, Haggerman will write about using of outplacement services and effective programs to ease transitions for affected employees.

Difficult decisions sometimes have to be made about layoffs because of harsh, economic realities and challenging business climate.

Tough choices also confront a company when an employee is not performing and should be terminated. The decision is easy, of course, if the team member is completely at fault, the in-depth coaching and counseling performed by a skilled manager does not work, and the person still chooses not to change.

The decision is harder if the organization is partly at fault for the employee's problems. What if he should not have been hired in the first place or he received poor training? What if he did not receive solid, timely counseling? What if the corporation allowed his inappropriate behavior to continue for too long? When is it time to let him go? In these cases an honest assessment would reveal that both the employee and the business are blame. Still, he must be released.

Out-of-work individuals in today's job market are scared because of the uncertainty of the future, which can result in a lashing out at former employers in the form of employment-related lawsuits. Angry workers also may try to get even by stealing customers, disclosing proprietary information or bad-mouthing the firm and its management staff while searching for a new position in the community.

This alarming and expensive trend is bound to get worse and could affect your establishment unless you begin handling all terminations or downsizings with caution and savvy.

Fortunately, techniques are available for you to successfully fight back. By using these techniques, will be able to reduce the risk of employment-related litigation by embittered staff and ensure none of your customers or trade secrets will be lost. You will be able to confirm that only positive communication will be transmitted from affected associates to potential future clients.

All of these benefits may be obtained by taking advantage of and expanding upon the regulations in a 1990 law that allows jobholders to waive their rights to sue for age discrimination.

The Older Workers Benefit Protection Act, an amendment to the Age Discrimination in Employment Act, provided the first clear rules for companies desiring to eliminate the possibility of lawsuits arising from terminations or layoffs. Although the OWBPA pertains only to age discrimination, businesses have realized that the same rules will protect them from all employment-related lawsuits.

The OWBPA creates minimum requirements for the preparation and usage of a release form. This form relieves the employer from any liability for age discrimination. The release form is legally binding on the worker and forbids him from filing a claim or lawsuit.

The release must be understandable, so it should be brief and contain language that is plain and conversational. In addition, the release must advise the person to consult with an attorney and specifically refer to his rights or claims protected under the ADEA. Only rights or claims that arose on or before the date the form is executed may be addressed. Accordingly, the laborer may not exempt the corporation from any future acts of age discrimination.

A major key to ensuring the release is legal is that the employee may only release rights or claims in exchange for "something of value to which he is not already entitled." For example, if he is entitled. Establishments will often use outplacement services as that item of value