Employers routinely offer departing employees separation agreements, whether as part of a reduction in force or in connection with an individual termination. These separation agreements typically include enhanced monetary benefits in exchange for a broad release of claims and promises not to sue. Such agreements are the very definition of a win-win proposition: the employee receives additional monies or other consideration to which she was not otherwise entitled, and the employer receives the assurance that it will not become entangled in litigation.
This seemingly uncontroversial arrangement is under attack in the U.S. Equal Employment Opportunity Commission’s federal lawsuit against CVS Pharmacy Inc. that was filed on Feb. 7, 2014. In that lawsuit, the EEOC alleges that a separation agreement tendered by CVS to departing employees was “overly broad, misleading and unenforceable,” and supposedly “interfered with employees’ rights to file charges with the U.S. Equal Employment Opportunity Commission and Fair Employment Practices Agencies.”
