A severance agreement can give both sides a practical way to end employment and resolve existing disputes. It can also create enforceability problems if the employer uses the wrong release language, overlooks an age-discrimination waiver requirement or tries to prohibit discussion of harassment or retaliation. New Jersey employers should review both federal and state rules before treating a signed document as a complete defense. Separate from the negotiated release, employers should consider New Jersey final-paycheck obligations.
Can a departing employee release every possible claim?
No. A release needs clear language and a lawful, supported agreement, and some rights cannot be prospectively waived. New Jersey’s Law Against Discrimination prohibits certain prospective waivers of rights or remedies concerning discrimination, retaliation or harassment. A release of existing claims is not the same as an attempt to eliminate rights against future unlawful conduct. The nature of the claims, existing proceedings and consideration offered matter.
What does the OWBPA require for workers age 40 or older?
For a waiver of rights under the federal Age Discrimination in Employment Act to be knowing and voluntary, the Older Workers Benefit Protection Act imposes additional conditions. The EEOC explains that individual termination offers ordinarily require at least 21 days for consideration and seven days for revocation, along with written advice to consult an attorney, specific reference to ADEA rights and other safeguards. Group exit incentive or termination programs can require at least 45 days and additional written disclosures. The precise context matters; do not paste individual-termination language into a group-reduction package.
Is it okay to demand silence about a discrimination complaint?
New Jersey’s N.J.S.A. 10:5-12.8 treats a nondisclosure provision as unenforceable against an employee if its purpose or effect is to conceal details relating to a claim of discrimination, retaliation or harassment. The provision also addresses the consequences of public disclosure and requires specified notice language in certain settlements. Courts have considered related non-disparagement language as well. The agreement should not promise blanket confidentiality that conflicts with these protections.
The statute distinguishes protected disclosures from bona fide proprietary information such as non-public trade secrets, business plans and customer information. Confidentiality, non-disclosure and non-disparagement terms require separate review instead of one sweeping paragraph.
What should employers do before sending the document?
Confirm who is receiving the agreement, whether the employee has counsel, what compensation is already owed regardless of signing, and what new consideration supports the release. Identify accrued benefits, return of property, customer relationships, confidentiality, lawful restrictive covenants and any pending agency charge or litigation. Make the draft comprehensible. Plan a consistent, nonretaliatory response to requests for clarification.
When should an employee seek advice?
Before signing away potentially valuable claims or agreeing to repayment, noncompete, confidentiality or cooperation provisions, an employee should review the entire document, not only the severance amount. An employer should likewise obtain appropriate counsel when the release interacts with claims under multiple laws, healthcare reporting duties or restrictive covenants.
BOLO Health Law advises New Jersey businesses and professionals on employment disputes, contract review, and document analysis.
Primary authorities
EEOC: Waivers of Discrimination Claims in Severance Agreements; N.J.S.A. 10:5-12.8—Nondisclosure Provisions; New Jersey P.L. 2019, c. 39.
Attorney advertising. General legal information reviewed October 18, 2026, for October 19 publication. This article is not a substitute for advice about specific facts, does not guarantee an outcome, and does not establish an attorney-client relationship. BOLO Health Law is a New Jersey law firm; representation depends on conflicts, proper jurisdiction and a written engagement.