Settlement or Release of FMLA Claims may require DOL or Court Approval

Some courts have ruled that waivers or releases of Family and Medical Leave Act (“FMLA”) claims (such as those found in separation agreements, severance agreements, and settlement agreements) must first be approved by the Department of Labor (“DOL”) or a court to be enforceable. Other courts have held they are enforceable without such approval.

In Taylor v. Progress Energy, Inc., 493 F.3d 454 (4th Cir. 2007), the Fourth Circuit held approval is required. This is based on a DOL regulation, which states, “Employees cannot waive, nor may employers induce employees to waive, their rights under the FMLA.” (quoting 29 C.F.R. § 825.220[d]). The court explained:

The FMLA, following the FLSA [Fair Labor Standards Act] model, provides a “minimum floor of protection” for employees by guaranteeing that a minimum amount of family and medical leave will be available annually to each covered employee… As with the FLSA, private settlements of FMLA claims undermine Congress's objective of imposing uniform minimum standards.

The Court rejected the employer's analogy to Title VII and ADEA claims, which can be waived without DOL or court approval. It also held that both prospective and retrospective claims are “rights” which cannot be waived without DOL or court approval.

However, Faris v. Williams WPC-I, Inc., 332 F.3d 316 (5th Cir. 2003), held that post-termination releases of past FMLA claims are enforceable, accepting the analogy to Title VII and the ADEA. It also accepted the argument that the FMLA only prohibits waiver of “substantive rights” as opposed to “post-dispute causes of action.”

The Fourth's Circuit's position seems to be more widely accepted. The following cases hold that DOL or court approval is necessary for a waiver or release of FMLA claims to be enforceable: Richardson v. Sugg, 448 F.3d 1046, 1056 (8th Cir. 2006); Dougherty v. Teva Pharmaceuticals USA, Inc. 2007 WL 1165068, 1 (E.D.Pa. 2007); Brezzee v. Fred Meyer Stores, Inc., 2006 WL 2045857, 11 (D.Or. 2006). In Bittner v. Blackhawk Brewery and Casino, LLC, 2005 WL 1924499, n. 2 (D.Colo. 2005), the United States District Court for the District of Colorado indicated in dicta that it would require DOL or court approval of FMLA releases and waivers. Other courts have followed the Fifth Circuit's holding in Faris. See, e.g., Sutherland v. Goodyear Tire & Rubber Co., 446 F.Supp.2d 1203, 1212 (D.Kan. 2006).

It is interesting that in Taylor the DOL, citing Faris, argued post-termination retroactive waivers of FMLA claims are enforceable without DOL or court approval. Despite the deference usually given to agency interpretations of its own regulations, the Fourth Circuit rejected the DOL's argument.

Many of the opinions point out that requiring approval will discourage settlement of FMLA claims. This may be true, but those settling FMLA claims need to be very careful. The safest course for an employer settling an FMLA claims with an employee or asking an employee to sign a release of FMLA claims (for example, in a severance agreement or separation agreement) is to obtain DOL or court approval.