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Labor and Employment Law

Uneven Severance Packages May Create Discrimination Claims

A severance agreement helps to allow businesses to ensure that former employees don't sue. The concept is fairly simple: in exchange for $X, the former employee agrees to release the company from every claim under the sun from the beginning of time through the date the former employee signs the agreement (or seven days after the agreement is signed in cases where the employee releases claims under the Age Discrimination in Employment Act).

Where am I going with this? Let's take a hypothetical. Assume that ABC Company decides to lay off two employees: Bob and Mary. Both worked the same position, have the same seniority, and reported to the same supervisor. However, ABC offers Bob six weeks of severance and Mary only three weeks of severance. Does Mary have a potential gender discrimination claim against ABC?

According to a recent decision from the Fourth Circuit Court of Appeals, Mary may have a claim. 

A female HR Director claims she received a lesser severance package than her male counterparts.

The case is Gerner v. County Of Chesterfield. There, Ms. Gerner, the County's HR Director -- I mean, former HR Director -- alleged that the County of Chesterfield offered "sweetheart" severance deals to many of her male co-workers. Ms Gerner too received a severance offer as part of a County downsizing. Except, according to Ms. Gerner, her offer was not so sweet. Certainly not as sweet as Hoosier football fans breaking into a rendition of Sweet Caroline at a game against Iowa.