Law360 Guest Article: EEOC Looks To Limit Severance Agreements With Litigation


On Feb. 7, 2014, the U.S. Equal Employment Opportunity Commission filed a suit against CVS Pharmacy Inc. claiming that a severance agreement containing common cooperation, nondisparagement and covenant-not-to-sue provisions "constitutes resistance to the full enjoyment of rights secured by Title VII of the Civil Rights Act of 1964 "because the agreement interferes with an employee's right to file a charge or cooperate with an investigation. Specifically, after emphasizing that the severance agreement is five-pages long, the EEOC attacks the following provisions on the grounds that they interfere with an employee’s rights under Title VII:

  • The “cooperation” paragraph, which requires the employee to promptly notify the company’s general counsel if the employee receives a subpoena, deposition notice, interview request or other inquiry relating to any administrative investigation or other legal matter relating to the corporation from any investigator or other third party;
  • The “nondisparagement” paragraph, which prevents the employee from making any statements that disparage the reputation of the corporation

Excerpted from Law360, March 18, 2014. To view full article, click here (subscription required).

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