CASE: Employee’s FMLA claims barred by separation agreement

​Valerie suffered from a variety of mental health disorders. A head injury aggravated her symptoms. She took some time off due to her head injury and the other symptoms. Before returning to work, she gave a letter to her employer from her doctor indicating that she could return to work and be able to perform as usual in a couple weeks. She did return to work two weeks later, but was terminated three days after that.

Upon the termination, the employer offered Valerie the option to sign a separation agreement that gave her two months’ salary in exchange for a general release of claims against the company. The agreement specifically included the FMLA among other laws. She had 14 days to review and sign the agreement and another seven days after that to revoke her signature.

Valerie signed the agreement, then later sued the company in part for FMLA violations.

In court, Valerie argued that, at the time she signed the separation agreement, she lacked the required mental capacity to enter into it or understand it, given her conditions. She claimed that the employer failed to advise her of her FMLA rights so she would feel she had no more leave available, inducing her to sign the agreement. She could not, however, identify who said she had no leave available or where it was said.

The employer argued that the agreement barred Valerie’s FMLA claim.

The court, in ruling for the employer, pointed out that the agreement was clear and unambiguous and plainly stated that signing it released the employer from any and all claims. Valerie had the education and experience to understand the agreement, and her doctor had indicated that she was fine at that point in time. She also had ample time to have the agreement reviewed.

Pucilowski v. Spotify USA, Inc., 2^nd Circuit Court of Appeals (Summary Order), No. 22-869-cv, November 10, 2022.

Beware, however, as other courts might take a different view. Back in 2005 the Fourth Circuit held that, without prior U. S. Department of Labor or court approval, the FMLA bars prospective or retrospective waivers or releases of FMLA claims; that, to obtain FMLA waivers or releases, employers must go through the same process for Fair Labor Standards Act waivers or releases.

Key to Remember: This court found that employers may use separation agreements to bar employee FMLA claims, but employers should tread carefully, as other courts might require employers to take certain steps.