April 14, 2017
Authored by: Bill Wortel
This post (the first of three) discusses common errors made by employers when terminating employees, all of which can be easily avoided.
Mistake No. 1: Offering an Older Employee a “Retirement” Package
Well intentioned employers sometimes are tempted to characterize a performance-based, involuntary termination of an older employee as a “retirement.” However, the mere mention of the word “retirement” in connection with a termination decision, even when offering an enhanced severance package, can lead to liability under the Age Discrimination in Employment Act (the “ADEA”).
Interestingly, the original version of the ADEA excluded from coverage employees who were 70 years old or older, as well as employees who were under the age of 40. Accordingly, employers could force employees to retire at age 70 under the original version of the ADEA without facing liability. However, the ADEA was amended in 1986 to remove the exclusion for employees who were 70