Two former longtime managers have sued the San Francisco 49ers in a California federal court alleging that they were terminated because of their age in violation of federal and California age discrimination laws.
The two plaintiffs, Anthony Lozano and Keith Yanagi, are both over 50-years-old and had 47 years of collective service to the team. They allege that they were terminated because the 49ers desired to hire predominantly younger employees from the neighboring Silicon Valley technology companies as part of the team’s movement to brand itself as a “technology startup” within the National Football League. More specifically, the Complaint alleges that as part of that technology strategy, in December 2012, the team’s CEO Jed York, openly admitted that he wanted to hire the predominantly younger technology workers from Silicon Valley technology companies “Because they made a lot of money, they did a lot of cool things before they turned 40 years old, and they don’t want to go play golf six days a week.” The lawsuit alleges that in order to make room for the younger technology workers, York engaged in a campaign to terminate older senior managers such as Lozano and Yanagi.
To further show age bias, the plaintiffs also allege that the team presented them with a separation agreement and release that did not comply with federal Older Workers Benefit Protection Act (“OWBPA”). The OWBPA is a federal law that governs the waiver of age discrimination claims. The Act requires that to be valid a waiver of age discrimination claims must be “knowing and voluntary.” While age discrimination claims alleging ageist comments is common, lawsuits challenging the validity of waivers under the OWBPA are not. This is not to suggest, however, that employers always draft valid waivers.
OWBPA lists seven factors that must be satisfied for a waiver of age discrimination claim to be considered “knowing and voluntary.” At a minimum:
1. A waiver must be written in a manner that can be clearly understood. EEOC regulations emphasize that waivers must be drafted in plain language geared to the level of comprehension and education of the average individual(s) eligible to participate.
2. A waiver must specifically refer to rights or claims arising under the ADEA. EEOC regulations specifically state that an OWBPA waiver must expressly spell out the Age Discrimination in Employment Act (“ADEA”) by name.
3. A waiver must advise the employee in writing to consult an attorney before accepting the agreement.
4. A waiver must provide the employee with at least twenty-one (21) days to consider the offer or forty-five (45) days if the waiver is being provided as part of a group termination.
5. A waiver must give an employee seven (7) days to revoke his or her signature. The seven-day revocation period cannot be changed or waived by either party for any reason.
6. A waiver must not include rights and claims that may arise after the date on which the waiver is executed. This provision bars waiving rights regarding discriminatory actsthat occur after the date of signing.
7. A waiver must be supported by consideration in addition to that to which the employee already is entitled. For example, if an employee is entitled to unused vacation pay upon termination, the employer must provide something of value in addition to the vacation pay to support the waiver.
In addition, if the termination stems from a group termination (a termination of more than one employee), the waiver must include statistical data showing the job title and ages of the employees being impacted. The plaintiffs in the 49ers lawsuit claim that York did not provide this statistical information, which would have demonstrated that the team was engaging in a pattern and practice of age discrimination. When they were terminated, both plaintiffs were told that their terminations were individual decision, and York concealed the fact that other older workers were terminated within a few days, weeks or months of the plaintiffs.
The 49ers’ lawsuit raises an important lesson – if you are going to offer severance payments to older employees in exchange for a waiver, make sure the waiver is valid. If a waiver fails to meet any of the OWBPA requirements, it is invalid and unenforceable. For this reason, employers should not copy or use a prior waiver without checking to see if it is appropriate for the particular situation. Rather, it is always prudent for an employer to seek legal counsel before terminating an employee and/or presenting the employee with a waiver.