Severance Agreement Rehire

Answer: No. In accordance with the new section 1002.5 (AB 749) of the Code of Civil Procedure, which will enter into force on 1 January, a composition agreement or a dismissal agreement may not contain any provision prohibiting, preventing or limiting an “injured person” from obtaining future employment with the employer, parent company, subsidiary, department, of the related undertaking or the employer`s contractor. The new law expressly states that a provision of “no reinstatement” is null and void in law and in violation of public order. One of the reasons for the new law is to avoid the situation in which an employee reports unlawful harassment, but then faces the prospect of having to leave their job to settle their rights. If a former employee has applied again and has previously signed a severance pay agreement with a “No Re Hiree” clause, the company can still hire the former employee. Typically, a standard indemnification agreement contains a “waiver clause” that states that the non-application of one or more provisions does not waive the applicability of the other provisions. The employee would not be required to retort the consideration or severance pay previously received. In the event that the employer wishes to reinstate an employee who has signed a clause without rehiring, the company should follow its normal recruitment procedures and then record in the letter of offer the waiver of the previous provision. The trace of paper is important! [Unlike the 21-day deadline to reconsider the severance pay proposal, it is not possible to waive the 7 days following the signing.] [Sometimes a brand new trade secret and confidentiality provision are inserted into the severance pay agreement, in this case because the employment intended to make the severance pay a new counterpart to that confidentiality.] [Unless expressly excluded, all prior agreements are anticipated by this new agreement.

Other simultaneous oral agreements or private promises on severance pay terms are not enforceable.] However, employers should always check local laws when they include such provisions….