Monday, January 21st, 2008...9:00 am
Enforcing Separation Agreements
To encourage an ex-employee to comply with a non-disclosure or a non-compete provision in a separation agreement, consider this proposal from an attorney:
I suggest that any severance payment be made over time rather than in a lump sum. That gives the business the opportunity to stop payment if there is a problem and the former employee is not likely to sue if he is still owed money. I try to spread the payments out past the limitations period of filing an EEOC complaint, if possible. Repaying the money if you sue would be great; however, the tender back of consideration is problematic under the Older Worker Benefit Protection Act provisions of the ADEA. Sometimes, I will allocate some money to the nondisclosure portion of the severance agreement and provide that it must be repaid as liquidated damages if there is a breach or suit is filed.
H/T: Charles A. Krugel
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