Labor & Employment Law

Settlement agreements including a clause barring a terminated employee from seeking reemployment ? are they valid?

In an article entitled Validity of Settlement Agreements Containing a ?Will Not Reapply for Employment? Provision, AELE considers the situation wherein an employee is dismissed from his or her position and subsequently alleges that he or she was terminated as the result of unlawful discrimination or unlawful retaliation.

In such situations, the employer and the employee may be able to negotiate a settlement of the employee?s administrative complaint, arbitration or lawsuit challenging the employer?s action.

In an article discussing this aspect of personnel management, AELE suggests that if a settlement is successfully negotiated, ?management sometimes insists that the [employee] promise not to reapply for employment? with the employer.

Without such an agreement, suggests AELE, in the event the individual subsequently applies for reemployment with his or her former employer and his or her application is rejected, such rejection will likely result in another discrimination and retaliation complaint being filed by the disappointed individual. With such a provision incorporated in the settlement agreement, says AELE, management?s can argue that it could lawfully reject the application on ?contractual grounds.?

Sample provision: [Name of employee] represents and agrees that [his or her] employment with [the employing entity] terminates upon the execution of this Agreement, and that [he or she] will not apply for or seek employment with [the entity] in any capacity at any time hereafter.

The article is posted on the Internet at:
http://www.aele.org/law/2009all08/2009-08MLJ201.pdf

Full post as published by New York Public Personnel Law on July 28, 2009 (boomark / email).