In The News

Fundamentals of Employment Law with Bryan Pieper

Bone McAllester Norton attorney Bryan E. Pieper will serve as a panelist for an upcoming employment law seminar with Sterling Education Services, Inc. “Fundamentals of Employment Law” will cover the basics of employment law, as well as address new developments emerging out of long-established standards.

Highlights of the program include: E-Verify, I-9 audits, avoiding penalties in wage and hour issues, social media rights and risks and health care reform. Attorneys, human resources professionals, payroll specialists and business owners should attend.

The all-day seminar takes place Tuesday, June 9, in Bowling Green, Ky. Continuing education credits are available.

Bryan is a member of the firm’s Labor & Employment Law practice. He has considerable trial and appeals court experience in state and federal courts, as well as hearings and investigations conducted by administrative agencies including the Equal Employment Opportunities Commission, the Tennessee Human Rights Commission and the United State Department of Labor.

For more information on this seminar, including how to register, click here.

 

 

 

 

 

Bone McAllester Norton PLLC is a full-service law firm with 38 attorneys and offices in Nashville, Sumner and Williamson counties, Tennessee. Our attorneys focus on 18 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

Jury Awards Nearly $500K for Sex Harassment and Retaliation

By Bryan E. Pieper

November 3, 2014

Last week, a federal jury awarded three former employees $499,000 against healthcare company EmCare, Inc. for sex harassment and retaliation. The plaintiffs alleged that the division CEO and other managers subjected Executive Assistant Gloria Stokes to “constant lewd sexual comments” that included comments about female body parts, derogatory references to women and sexual jokes. Ms. Stokes alleged that she complained about the harassment, but HR failed to take appropriate action.  The other two plaintiffs, Luke Trahan and Bonnie Shaw, complained to HR about the sexual comments and were fired six weeks later.  Title VII of the 1964 Civil Rights Act prohibits sex harassment and prohibits retaliation against employees who oppose sex harassment.

The jury awarded Ms. Stokes $250,000 in the sex harassment claim. While EmCare claimed Mr. Trahan and Ms. Shaw were fired for performance issues, the jury found that they were fired in retaliation for complaining about the sex harassment and awarded them $167,000 and $82,000, respectively, bringing the total award up to $499,000.

This jury verdict highlights several important rules for employers:

  1.  Employers must take employee complaints of harassment seriously by investigating thoroughly and taking appropriate action to prevent and correct any sexually harassing behavior.

  2.  Anti-harassment rules must apply to everyone and must be enforced against even the highest ranking company officers or owners.

  3. While an employer cannot stop managing an employee simply because the employee has complained about harassment, the employer must acknowledge the additional risk associated with terminating or disciplining such an employee. Recognizing that the timing may appear suspicious to a jury and the decision closely scrutinized, the employer should take additional care to make sure that the performance or other legitimate reasons for termination or discipline are well-supported by the evidence and consistently applied.


For more information about the EmCare jury verdict, read the EEOC's press release here.

Super Lawyers Honors 15 Bone McAllester Norton Attorneys

Mid-South Super Lawyers List Includes Outstanding Attorneys with High-Degree of Peer Recognition and Professional Achievement

Nashville, Tenn.—(November 5, 2014) The 2014 Mid-South Super Lawyers ratings of outstanding lawyers was released today, and 15 Bone McAllester Norton attorneys were included. Eleven were named as Mid-South Super Lawyers, while four were included as Mid-South Rising Stars.

“Our attorneys pride themselves on a thorough understanding of our client’s objectives and then focus on coming to creative, strategic solutions,” said Charles W. Bone, founder and chairman of Bone McAllester Norton PLLC. “I believe that’s why our peers have chosen more than a dozen of our attorneys for awards like this. We are grateful to them for observing the expertise and passion behind what we do.”

Mid-South Super Lawyers are selected through a multi-phased process, which includes independent research, peer nominations and peer evaluations. The list is produced by Super Lawyers, a national rating service that includes more than 70 practice areas.

Super Lawyers also selects attorneys to be included in its Rising Stars list, which is compiled using the same requirements and selection process as the Super Lawyers list. However, to be eligible for inclusion in Rising Stars, a candidate must be either 40 years old or younger or in practice for no more than 10 years.

The 11 Mid-South Super Lawyers are:

  • Charles Robert Bone, business litigation;

  • John P. Branham (of counsel), business litigation;

  • Larry W. Bridgesmith (of counsel), labor and employment law;

  • C. David Briley, personal injury: plaintiff;

  • James A. Crumlin, Jr., labor and employment law;

  • Sharon (Sheri) O. Jacobs, environmental law;

  • Anne C. Martin, employment litigation: defense;

  • Sam (Mac) J. McAllester, III, real estate law;

  • Bryan E. Pieper, business litigation;

  • Edward M. Yarbrough, criminal defense;

  • Stephen J. Zralek, intellectual property litigation.


The four Mid-South Rising Stars are:

  • David M. Anthony, bankruptcy law;

  • Alex Little, criminal defense;

  • Andrea P. Perry, real estate law;

  • Chris Raybeck, banking.


For more information about these awards, visit http://www.superlawyers.com/. For more information about Bone McAllester Norton, visit http://bonelaw.com/.

 

About Bone McAllester Norton PLLC

Bone McAllester Norton PLLC is a full-service law firm with 40 attorneys and offices in Nashville, Sumner and Williamson counties, Tennessee. Our attorneys focus on 18 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

# # #


Media Contact:

Ann Dee McClane, (615) 742-6889

This email address is being protected from spambots. You need JavaScript enabled to view it.

Doing Business with Foreign Suppliers or Manufacturers? Beware Their Illegal Practices

By Bryan E. Pieper

Yesterday, the 9th Circuit Court of Appeals held that Nestle, Archer Daniels Midland and other companies that sell chocolate from Africa can be sued for importing cocoa harvested by child slave laborers in the Ivory Coast. Three former child slave laborers sued the defendant food manufacturers for allegedly using and selling the product of their slave labor, under a 1789 law allowing suits in U.S. courts for violations of international human rights.

The trial court dismissed the lawsuit, holding that the law did not apply to the defendant U.S. corporations’ alleged involvement in the illegal activities that occurred abroad. The Court of Appeals disagreed, holding that they could be sued in U.S. courts if their actions in the U.S. substantially contributed to human rights violations overseas.

The defendant companies argued that they were simply searching for the cheapest sources of cocoa. Writing for the dissent, Judge Johnnie Rawlinson agreed, arguing that the U.S. companies should not be held liable to the former child slave laborers for the abuse done to them by companies in Africa because the lawsuit did not show that the U.S. companies “acted with the purpose of aiding and abetting child slave labor.” Rather, their motive was merely to increase profits by obtaining cocoa from the cheapest source available.

The majority rejected this argument and reinstated the case, arguing that the defendant companies knew the suppliers were using child slave labor but did nothing to end it or even to stop using those sources. Writing for the majority, Judge Dorothy Nelson argued that the plaintiffs’ allegations were sufficient to establish that the defendant companies willingly accepted the benefits of slave labor, writing “Driven by the goal to reduce costs in any way possible, the defendants allegedly supported the use of child slavery, the cheapest form of labor available,” and that they “placed increased revenues before basic human welfare.”

You can find the entire court opinion here.

 

Bone McAllester Norton PLLC is a full-service law firm with 38 attorneys and offices in Nashville and Sumner County, Tennessee. Our attorneys focus on 17 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

Where Is My Wine in Grocery Stores, Protecting Your Copyright & More

Bone McAllester Norton has important updates and announcements to share with you, our valued clients and friends, in our latest newsletter. Click here to read the latest on wine in grocery stores, which of our attorneys were named "Best Lawyers" and the advice Stephen Zralek gives about protecting your copyright.

Bone McAllester Norton PLLC is a full-service law firm with 38 attorneys and offices in Nashville and Sumner County, Tennessee. Our attorneys focus on 17 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

Bone McAllester Norton Receives “Best Lawyers” Accolades

Firm Receives “Best Law Firm” Ranking, 14 Attorneys Named The Best Lawyers in America©

Nashville, Tenn.—(August 18, 2014) Nashville-based law firm Bone McAllester Norton PLLC announced today that it is celebrating three separate honors from the 21st edition of The Best Lawyers in America©. More than a dozen of its attorneys have been named to the 2015 list. Two attorneys, Charles Robert Bone and Anne C. Martin, were also chosen as “Lawyer of the Year” in Nashville in their respective practice areas. And the firm itself has been named a “Best Law Firm” in a Tier 1 ranking in the 2015 edition of U.S. News – Best Lawyers “Best Law Firms.”

“Our attorneys are united by their enthusiasm for the law and a relentless dedication to our clients, and I think that is why 14 of our attorneys, as well as the firm overall, have received this recognition,” said Charles W. Bone, founder and chairman of Bone McAllester Norton. “We are grateful to our peers for observing the expertise and passion behind what we do.”

Charles Robert Bone was named Best Lawyers® 2015 Administrative/Regulatory Law “Lawyer of the Year” in Nashville. Anne C. Martin received this distinction for Employment Law—Individuals.

The Bonelaw attorneys listed in The Best Lawyers in America 2015 list are:

    •   Trace Blankenship for the areas of Banking and Finance Law and Non-Profit/Charities Law;
    • •  Charles W. Bone for the area of Administrative/Regulatory Law;
    • •  Charles Robert Bone for the areas of Administrative/Regulatory Law and Business Organizations (including LLCs and Partnerships);
    •   John P. Branham for the area of Personal Injury Litigation—Plaintiffs;
    • •  Larry W. Bridgesmith for the areas of Employment Law—Management and Labor Law—Management;
    •   William T. Cheek III for the areas of Food and Beverage Law and Non-Profit/Charities Law. Will is the only listed lawyer for Food and Beverage Law in Tennessee.
    •   Paul W. Kruse for the areas of Copyright Law and Trademark Law;
    •   Anne C. Martin for the areas of Employment Law—Individuals, Employment Law—Management and Litigation—Labor and Employment;
    • •  Sam J. McAllester III for the areas of Banking and Finance Law and Bankruptcy and Creditor Debtor Rights/Insolvency and Reorganization Law;
    •   C. Michael Norton for the area of Banking and Finance Law;
    • •  Bryan E. Pieper for the area of Employment Law—Individuals;
    •   Jack F. Stringham II for the areas of Banking and Finance Law and Real Estate Law;
    • •  Edward M. Yarbrough for the areas of Criminal Defense: Non-White Collar, Criminal Defense: White-Collar and DUI/DWI Defense;
    • •  and Stephen J. Zralek for the area of Copyright Law.

Bone McAllester Norton received the “Best Law Firms” Tier 1 ranking for Nashville in seven areas:

    • •  Administrative/Regulatory Law;
    • •  Banking and Finance Law;
    • •  Criminal Defense: Non-White Collar;
    • •  DUI/DWI Defense;
    • •  Employment Law—Individuals;
    • •  Employment Law—Management;
    • •  and Personal Injury Litigation—Plaintiffs.


The Best Lawyers in America list for 2015 includes attorneys covering all 50 states and the District of Columbia, and inclusion in this year’s publication is based on more than 4.3 million detailed, confidential evaluations of lawyers by other lawyers. Lawyers are not required or allowed to pay a fee to be listed; therefore inclusion in Best Lawyers is considered a singular honor. Since it was first published in 1983, Best Lawyers has become universally regarded as the definitive guide to legal excellence. Corporate Counsel magazine has called Best Lawyers “the most respected referral list of attorneys in practice.”

For more information on Bone McAllester Norton and its attorneys, visit http://www.bonelaw.com/.

 

About Bone McAllester Norton PLLC

Bone McAllester Norton PLLC is a full-service law firm with 38 attorneys and offices in Nashville and Sumner County, Tennessee. Our attorneys focus on 17 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

# # #


Media Contact:

Ann Dee McClane, (615) 742-6889

This email address is being protected from spambots. You need JavaScript enabled to view it.  

White House Tightens Standards on Contractors Who Can Do Business with the U.S. Government

By Bryan E. Pieper

Last Thursday, President Obama signed the Fair Pay and Safe Workplaces Executive Order, designed to ensure that the U.S. government spends taxpayer money on contractors who comply with the law, pay their employees fairly and protect the safety and health of their employees. Congressional studies show that many companies that are guilty of large or repetitive wage and hour or safety and health violations continue to win billions of dollars in government contracts year after year. Allowing the worst or repeat offenders to compete for federal contracts without complying with pay and safety laws puts those contractors who play by the rules at a competitive disadvantage, according to the White House, which stated that the new standards for awarding federal contracts will help level the playing field and encourage violators to get into compliance.

To achieve this, the Executive Order provides that, before being awarded a large federal contract, a contractor must provide certain information regarding its compliance with labor and employment laws and take certain steps designed to protect its employees’ ability to enforce their rights under those laws.
  • Before an agency will award a contractor a federal contract worth more than $500,000, the contractor must report all labor and employment law violations for the past three years. Contracting agencies will screen for the worst actors with the most egregious violations or repeat violations to ensure that they do not get taxpayer funded contracts.  The goal, however, is not merely to prevent violators from getting federal contracts but to help more contractors come into compliance with workplace laws. Contractors with labor law violations will be offered the opportunity to receive early guidance on the violations and to remedy them. Contracting officers will take these steps into account before awarding a contract.
  • Contractors will be required to give employees specific information on their paystubs regarding hours worked, overtime hours, pay and any additions to or deductions from their pay so that employees can verify they are being paid what they are owed and that the pay is in compliance with wage and hour laws.
  • Before an agency will award a contractor a federal contract worth more than $1 million, the contractor must agree not to require its employees to sign arbitration agreements that prevent them from going to court for discrimination, sexual assault or harassment claims.  This would not apply to valid agreements already in place.
The White House contends that these new criteria will also improve federal contracting efficiency and result in greater returns on taxpayer dollars, as companies with workplace violations are more likely to encounter performance problems or to have projects delayed by litigation. These requirements likely will not become effective until the issuance of final regulations, after a period for public comment, which the White House estimates could be as late as 2016.

Some observers contend that requiring contractors not to make employees sign pre-employment arbitration agreements is in tension with the strong congressional policy in favor of arbitration that is expressed in the Federal Arbitration Act.  Others respond that the Executive Order is consistent with the congressional policy expressed more recently in the Department of Defense Appropriations Act of 2010, which conditions the award of any federal defense contract more than $1 million on the contractor agreeing not to require arbitration of certain employment claims.  For this reason, it is likely that the Executive Order may be challenged in court.

Click here for the Fact Sheet published by the White House.

 
 
Bone McAllester Norton PLLC is a full-service law firm with 38 attorneys and offices in Nashville and Sumner County, Tennessee. Our attorneys focus on 17 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.
 

 

Paz Haynes & Bryan Pieper will Discuss Employment Law for Education Seminar

Bone McAllester Norton attorneys William J. (Paz) Haynes III  and Bryan E. Pieper will serve as presenters in an employment law program on August 12. Sterling Education Services' 10th annual “Employment Law: Beyond the Basics” continuing education seminar will provide information on emerging critical developments and updates, including FMLA and ADA issues, harassment and discrimination, FLSA/wage and hour crackdown, Obamacare and more.

Paz will present “Privacy and Social Media in the Workplace," addressing topics like the balance between employer’s right to know vs. employee’s privacy, wireless devices, use of social networking sites and the NLRB and social media. He concentrates his Nashville law practice in the areas of general business, labor and employment, administrative and commercial and civil litigation.

Bryan's session, "Termination Best Practices," will feature a discussion on legal considerations like the WARN Act and OWBPA; structuring severance and separation practices; RIF, layoffs and early retirement; and strategies for avoiding claims during terminations. He concentrates his practice in labor and employment law and litigation in Nashville.

HR professionals, business owners, managers, payroll professionals and labor and employment attorneys are encouraged to attend. Continuing education credits are available.

Get more information, including registration, here.

 

 

Bone McAllester Norton PLLC is a full-service law firm with 39 attorneys and offices in Nashville and Sumner County, Tennessee. Our attorneys focus on 17 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

Bryan Pieper will Speak at Fundamentals of Employment Law Seminar

Bone McAllester Norton Labor & Employment Law attorney Bryan E. Pieper is on the faculty of the Sterling Education Services, Inc. Fundamentals of Employment Law Seminar, scheduled for Tuesday, May 13. Bryan will present two sessions during the all-day event: “Hiring and Terminating Employees in the Current Economy” and “ADA and FMLA Updates and Interplay.” The seminar will cover everything from the basic fundamentals to new developments in employment law that everyone—human resources professionals, attorneys, supervisors, payroll specialists and business owners—needs to know.

The seminar will be held at the Chattanooga Marriott Downtown.

More information, including how to register, can be found here.

 

Bone McAllester Norton PLLC is a full-service law firm with 37 attorneys and offices in Nashville and Sumner County, Tennessee. Our attorneys focus on 17 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

Bryan Pieper will Give an Update on the Genetic Information Nondiscrimination Act at MTSHRM Meeting

Bone McAllester Norton attorney Bryan E. Pieper is slated as the speaker for the Middle Tennessee Society for Human Resource Management March meeting. Bryan, one of Bonelaw’s Labor and Employment Law attorneys, will present “GINA: Five Years Later” to the group. The Generic Information Nondiscrimination Act, signed into law in 2008 by President George W. Bush, has meant changes for employers. Bryan will discuss what has happened since the bill made it way through the courts and address questions still unanswered.

The breakfast meeting will take place Thursday, March 20 at the Hampton Inn in Mt. Juliet, Tenn.

 

 

Bone McAllester Norton PLLC is a full-service law firm with 37 attorneys and offices in Nashville and Sumner County, Tennessee. Our attorneys focus on 17 distinct practice areas, providing the wide range of legal services ordinarily required by established and growing businesses and entrepreneurs. Among our practices, we represent clients in business and capital formation, mergers and acquisitions, securities matters, commercial lending and creditors’ rights, commercial real estate and development, governmental regulatory matters, commercial litigation and dispute resolution, intellectual property strategy and enforcement, entertainment and environmental matters. Our client base reflects the firm’s deep understanding and coverage of today’s leading industry and business segments. For more information, visit www.bonelaw.com.

EEOC Attacks Common Severance Agreement Language

By Bryan E. Pieper The U.S. Equal Employment Opportunities Commission (“EEOC”) has filed a lawsuit against CVS Pharmacy, Inc., claiming that a severance agreement CVS has employees sign violates the employees' rights to communicate with the EEOC and to participate in EEOC investigations. Click here for the full lawsuit. Many of the provisions targeted by the EEOC are considered fairly typical in employee severance agreements. As is common in severance agreements, the employer, CVS, agrees to give the employee severance benefits, conditioned on the employee making certain promises in exchange. The EEOC takes issues with those required promises, specifically identifying the following provisions:

    • The employee releases any and all claims he or she may have against CVS;
    • The employee agrees not to file any claims again CVS in any court or agency;
    • The employee agrees not to make any statements that disparage CVS or its business;
    • The employee agrees not to disclose to any third party any of CVS's confidential information, which is defined to include personnel information;
    • The employee agrees to cooperate with CVS by notifying CVS promptly if the employee is contacted regarding any lawsuit or administrative proceeding against CVS; and
    • If the employee breaches the severance agreement, CVS will be entitled to an immediate injunction, and the employee will reimburse CVS for any attorneys’ fees incurred enforcing the agreement.

In its Complaint, the EEOC asserts that the combination of the above provisions deprives an employee of his Title VII right to participate in and cooperate with an EEOC investigation and enables an employer to conceal a pattern of discrimination by thwarting the EEOC's ability to learn about and investigate employment discrimination. The EEOC alleges that in 2012, more than 650 individuals signed the CVS severance agreement. "Charges and communication with employees play a critical role in the EEOC's enforcement process because they inform the agency of employer practices that might violate the law," explained the EEOC’s lead attorney on the case. "For this reason, the right to communicate with the EEOC is a right that is protected by federal law. When an employer attempts to limit that communication, the employer effectively is attempting to buy employee silence about potential violations of the law. Put simply, that is a deal that employers cannot lawfully make." Click here to read the EEOC's full press release. The EEOC asked the court to do the following:

    • • Enjoin CVS from continuing to use the current version of the severance agreement;
    • • Reform the agreement to comply with Title VII, both for individuals who have already signed it and for those who sign it in the future;
    • • Require CVS to issue a corrective communication informing its workforce of its right to file an EEOC charge and to initiate and respond to communication with the EEOC;
    • • Require CVS to provide its management with additional training regarding an employee's Title VII right to file charges and participate in EEOC investigations; and
    • • Provide a window of 300 days for any former employee who has signed the severance agreement to file a charge of discrimination with the EEOC.

Because employers typically enter into severance agreements and pay severance pay in order to get the peace of mind that they have made a clean break with an employee, the agreement provisions discussed above are rather common. This clean break is often essential to an employer’s willingness to provide non-mandatory severance benefits in the first place. However, the EEOC contends this lawsuit is part of its new emphasis on attacking systemic patterns of discrimination and the methods employers use to protect and hide them. This is consistent with the EEOC's practice of using investigation of an individual charge of discrimination as an opportunity to look for class or group claims, which would be difficult if all former employees are bound to silence. Employers are encouraged to have their current severance agreements reviewed by counsel and to keep an eye on this case as it progresses through the courts.

EEOC Attacks Common Severance Agreement Language

By Bryan E. Pieper The U.S. Equal Employment Opportunities Commission (“EEOC”) has filed a lawsuit against CVS Pharmacy, Inc., claiming that a severance agreement CVS has employees sign violates the employees' rights to communicate with the EEOC and to participate in EEOC investigations. Click here for the full lawsuit. Many of the provisions targeted by the EEOC are considered fairly typical in employee severance agreements. As is common in severance agreements, the employer, CVS, agrees to give the employee severance benefits, conditioned on the employee making certain promises in exchange. The EEOC takes issues with those required promises, specifically identifying the following provisions:
  • The employee releases any and all claims he or she may have against CVS;
  • The employee agrees not to file any claims again CVS in any court or agency;
  • The employee agrees not to make any statements that disparage CVS or its business;
  • The employee agrees not to disclose to any third party any of CVS's confidential information, which is defined to include personnel information;
  • The employee agrees to cooperate with CVS by notifying CVS promptly if the employee is contacted regarding any lawsuit or administrative proceeding against CVS; and
  • If the employee breaches the severance agreement, CVS will be entitled to an immediate injunction, and the employee will reimburse CVS for any attorneys’ fees incurred enforcing the agreement.
In its Complaint, the EEOC asserts that the combination of the above provisions deprives an employee of his Title VII right to participate in and cooperate with an EEOC investigation and enables an employer to conceal a pattern of discrimination by thwarting the EEOC's ability to learn about and investigate employment discrimination. The EEOC alleges that in 2012, more than 650 individuals signed the CVS severance agreement. "Charges and communication with employees play a critical role in the EEOC's enforcement process because they inform the agency of employer practices that might violate the law," explained the EEOC’s lead attorney on the case. "For this reason, the right to communicate with the EEOC is a right that is protected by federal law. When an employer attempts to limit that communication, the employer effectively is attempting to buy employee silence about potential violations of the law. Put simply, that is a deal that employers cannot lawfully make." Click here to read the EEOC's full press release. The EEOC asked the court to do the following:
  • • Enjoin CVS from continuing to use the current version of the severance agreement;
  • • Reform the agreement to comply with Title VII, both for individuals who have already signed it and for those who sign it in the future;
  • • Require CVS to issue a corrective communication informing its workforce of its right to file an EEOC charge and to initiate and respond to communication with the EEOC;
  • • Require CVS to provide its management with additional training regarding an employee's Title VII right to file charges and participate in EEOC investigations; and
  • • Provide a window of 300 days for any former employee who has signed the severance agreement to file a charge of discrimination with the EEOC.
Because employers typically enter into severance agreements and pay severance pay in order to get the peace of mind that they have made a clean break with an employee, the agreement provisions discussed above are rather common. This clean break is often essential to an employer’s willingness to provide non-mandatory severance benefits in the first place. However, the EEOC contends this lawsuit is part of its new emphasis on attacking systemic patterns of discrimination and the methods employers use to protect and hide them. This is consistent with the EEOC's practice of using investigation of an individual charge of discrimination as an opportunity to look for class or group claims, which would be difficult if all former employees are bound to silence. Employers are encouraged to have their current severance agreements reviewed by counsel and to keep an eye on this case as it progresses through the courts.