In Dougherty v. Teva Pharmaceuticals USA, No. 05-2336, 2006 U.S.Dist. LEXIS 62179 (E.D.Pa. Aug. 29, 2006) found that section 825.220(d) prohibits an employee from waiving their right to sue for FMLA violations through a severance agreement. 825.220(d) provides that:
Employees cannot waive, nor may employers induce employees to waive their rights under [the] FMLA.
In Dougherty, Teva’s human resources manger suggested that Dougherty leave Teva due to continuing conflicts with her supervisor. Plaintiff was subsequently provided a Separation Agreement and General Release. The Separation Agreement provided that, in exchange for agreeing to its terms Dougherty would receive one month’s salary and continued health insurance through COBRA. The Agreement released all claims against Teva arising out of her employment. Dougherty initially indicated that she did not want to leave the company but wanted to take a leave of absence. Teva sweetened the offer by increasing the compensation to two months salary and two months of continued COBRA coverage. Dougherty accepted the deal and signed a modified Agreement. A week after she signed the Agreement and took the money Dougherty called her employer and stated that she wanted to revoke the Agreement. She subsequently filed suit alleging violation of the FMLA.
The court noted that whether an employee can, as part of a severance agreement, waive his or her right to sue for violations of the FMLA was a matter of first impression in the Third Circuit. The court noted that the circuits are split on this issue. The Fourth Circuit held that the plain language of 825.220(d) prohibits any waiver of the substantive and protective rights conferred by the FMLA unless approved by the DOL or a court. The Fifth Circuit found that separation agreements were enforceable because 825.220(d) prohibited only the prospective wavier of FMLA “rights” (e.g., leave and reinstatement) and that the ability to file a civil suit was not such a “right” but merely a means of enforcement. The court in Doughtery found the decision of the Fourth Circuit more persuasive. The court went on to reject the argument that the plaintiff ratified the agreement by retaining the two months severance pay, finding that the third Circuit has concluded that “concepts of ratification and tender back are inapplicable to federal remedial statutes.”
Comment: The decision is applicable to FLMA cases arising under Title I, the CAA, and the PEOAA as these FMLA variants contain anti-wavier provisions. Title II does not allow civil suit and does not otherwise contain similar anti-waiver provisions. To avoid financing litigation against the agency, federal employers subject to Title I, the CAA, or the PEOAA should consult with counsel before securing a severance agreement waiving the right to sue for FMLA violations.