Employee Releases in ERISA Disputes: Minimizing Claims With Effective Release Provisions

Strafford

Recent Decisions, ERISA Rules and Limitations, Claims Filed by Individuals vs. Benefit Plans, Challenges in Enforcement

This CLE webinar will provide guidance to ERISA counsel on key issues in the application of employee releases in ERISA claims and litigation. The panel will discuss recent court cases applying and interpreting employee release provisions in employment and severance agreements, ERISA requirements and key challenges, fiduciary liability, and best practices for ERISA counsel and plan sponsors in enforcing employee releases.

Severance or settlement agreements often include employee releases to limit plan participants from pursuing ERISA claims against fiduciaries. ERISA counsel and plan sponsors must ensure that release provisions satisfy ERISA requirements and implement adequate procedures to enforce such provisions.

Generally, releases are enforceable if executed by the plaintiff knowingly and voluntarily based on a totality of circumstances of a variety of factors the courts take into account. With ERISA claims, counsel must consider whether or not benefits have vested, what applications are being waived, and if the claim is on behalf of the individual or the plan.

In Innis v. Bankers Trust Co. of South Dakota, the court entered summary judgment against the plaintiff because she signed a severance agreement and received severance pay and job-transition services, which barred her claims against the ESOP trustee based on the broad language of the release. However, under similar circumstances, the same claim could be pursued against a fiduciary by the benefit plan itself.

Overly broad or ambiguous language can cause a release to be unenforceable. ERISA counsel and plan sponsors must understand the strict requirements of release language in severance or settlement agreements and methods to enforce them to minimize claims.

Listen as our panel discusses critical factors considered by courts in the application of employee releases for ERISA claims and drafting effective provisions in severance agreements and similar documents, as well as offers litigation techniques in the enforcement of employee releases.

Outline:

• Background and guidance for employee releases under ERISA
• Recent case law; Innis v. Bankers Trust Co. of South Dakota
• Drafting effective release language to limit claims
• Best fiduciary practices

The panel will review these and other key issues:

• What are the critical factors considered by a court in applying or interpreting the release of claims and arbitration language?
• What are the provisions in plan documents and severance agreements that ERISA counsel and plan sponsors must consider?
• What are the challenges under ERISA where employee releases or arbitration language are at issue?
• What litigation tactics are available to fiduciaries when enforcing release or arbitration provisions?

Faculty: Nancy B. Pridgen, Attorney, Pridgen Law

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