• Failure to Disclose RIF Group, Criteria Yields Unenforceable Release, Viable Age Claim
  • September 23, 2005 | Author: Rodney A. Satterwhite
  • Law Firm: McGuireWoods LLP - Richmond Office
  • The 10th Circuit held that an employer failing to accurately disclose the individuals selected for reduction in force and the criteria used in selecting them rendered a subsequent release of claims invalid as a matter of law. In doing so, it allowed the plaintiff's ADEA claims to advance.

    The employees initially signed a release of claims following termination during the reduction in force. They then brought claims under the ADEA, stating that the releases were invalid. The employees argued that the employer changed the category of individuals selected for the RIF by first stating the decisional unit would include all salaried employees, then stating it would include all salaried employees reporting to the facility manager. This change in the decisional unit omitted 10 percent of the employees from the termination notice. Further, the employees argued that the employer failed to disclose the eligibility factors used for determining which employees would be terminated and which would not. The employer admitted that it used factors like skills, ability, leadership, behavior, and business needs to decide who would remain employed, but it also admitted that it did not disclose that information to employees.

    The court ruled that these failures to disclose rendered the release invalid. The employer's disclosure of the decisional group members and eligibility criteria when conducting a reduction in force is central to the validity of a subsequent release of claims. If a release of claims is invalid, a follow-up ADEA claim can potentially stand.