Signing your rights away?

May 25, 2006 10:41 AM

A friend of mine has an employer who is asking my friend (who is quitting voluntarily to move cross-country) to sign what I believe is a non-legal waiver. Can any legally savvy Mefites help out?

It's my friend's second to last day on the job. He's had good attendance and has consistently been one of the top performers at his company, however, he is quitting (coincidentally) right before their peak time of year.

In his 'exit packet', a waiver was included that basically stated that his employer could say ANYTHING about him on future references -- "up to and including intentional defamation of character." Having researched this, I have seen that "defamation of character" only happens when you intentionally lie to make a former employee look bad. It also says that if he takes them to court over this, even if his case is justified, he automatically loses and has to pay the company's attorney fees.

I'm not a lawyer, so I don't know what to tell him. I've never seen a document so clearly saying "we can do whatever we want to you, even if it's illegal as hell." This company isn't some fly-by-night, small-potatoes operation. Most mefites have probably used their services.

Right now, my friend is basically worried about 2 things:

1) If he does sign it, does this waiver have any legal standing whatsoever, or is it the equivalent of signing a contract that says "we can rape and kill you if we feel like it" -- i.e. totally unenforcable because it includes illegal activities?

2) If he does not sign it, how much information is the company obligated to give for a reference? I know they don't have to give a "so-and-so is a great employee" reference, ever, but legally, do they have to tell you what dates an employee worked, or can they just say "nope, he never worked here" if he doesn't sign this thing?

posted by InnocentBystander to law & government (28 comments total)

Wow, that is rough. I don't know anything about the legal implications of this, but it seems to be a situation of damned if you do, damned if you don't. Seems that he'd be better of not signing it, because at least then if they do defame him, he can pursue legal action and not automatically lose.

I'm not sure that an employer could lie and say that you didn't work somewhere; perhaps if it came time to call references he could explain that they have a strange policy and may not give accurate information. If he has anything that can back up his employment (i.e. examples of his work, emails congratulating him on a good job with a project, etc), that might help?

Are there any old coworkers that he could talk to for advice on how they handled this?

BTW - would love to know which company this is so I can be sure to avoid them for pulling something so nasty.
posted by ml98tu at 10:51 AM on May 25, 2006

Cash the last paycheck and don't sign the waver.
posted by b1tr0t at 11:06 AM on May 25, 2006

I wouldn't sign it. He can quit either way and that way he wouldn't be giving up his rights.

If he has been a good employee he probably doesn't have to worry about defamation anyway.
posted by spakto at 11:11 AM on May 25, 2006

here's another clause (this isn't even the "up to and including" clause) from the contract:

"I hereby promise and agree to release, discharge, waive, exonerate,
and hold harmless [company], its parents, subsidiaries, successors, and
any related companies, and the officers, employees, directors, agents,
and representatives from any and all loss, claim, injury, damage, or
liability sustained or incurred by me including, but is not limited to,
defamation, interference with an economic relationship, libel, slander,
interference with a prospective economic relationship, breech of
contract, negligence, intentional infliction of emotional distress
, retaliation, discrimination, promissory estoppel, breach of
implied contract, and any other claims pursuant to any other federal,
state, or local law, regulation, ordinance, public policy, or common law
claim or cause of action resulting from the furnishing of such
documents, records, and any other information whether in written,
electronic, or in oral form."

He copied this to me over his lunch break so I could see just how screwy this whole thing is.

So basically, not only (according to this contract) is he not allowed recourse for defamation, but even if his employer retaliates against him or intentionally inflicts emotional distress (!!!), slanders or libels him.

Once again, I'm not a lawyer, but isn't it really not-binding to say that you can never sue even if your employer does something actually illegal?
posted by InnocentBystander at 11:13 AM on May 25, 2006

His big worry if he doesn't sign is that when he applies for a job in his new town, they'll call the company and say "hey, has so-and-so worked here?" and they'll say "nope. We have no record of that." or "we can't tell you whether he did or not," both of which would look really, really bad to a future employer.
posted by InnocentBystander at 11:14 AM on May 25, 2006

Hell, no, he shouldn't sign it, unless he really needs a reference from the company. Why would you ever sign away your rights unless you were getting something significant in return?

Companies are not obligated to say anything at all about former employees. It would probably be legally actionable iif they lied and claimed that he didn't work there at all (assuming he hadn't signed the waiver, of course), so they would most likely either confirm that he did work there or decline to say anything whatsoever.

Many companies these days (in the U.S., anyhow) have a policy of not providing references for former employees because they are very afraid of lawsuits. This waiver is surely an attempt to make it possible for them to provide a reference for your friend, because it indemnifies them against any lawsuits he might feel like filing should the reference not be quite what he was hoping for. This doesn't mean that it would be a bad reference, of course.

On balance, I think it's best he not sign it unless he desperately needs a reference from the company. If he doesn't sign it, he almost certainly won't get one, but if he does, he has no recourse even if they lie and say he's an axe murderer.
posted by cerebus19 at 11:21 AM on May 25, 2006

First, I would imagine paystubs / tax-returns can provide proof that your friend worked at the old job, should the new employer require proof of prior employment.

Personally, INAL (yet, just finished my 1st year), so get real legal advice before movign forward; but a contract term stating that a current employer has the right to "intentionally defame" its employee strikes me as being the paradigmatic unconscionable contract term that courts prefer not enforce. Especially considering this term comes about after the employment has already started. Further, this strikes me as an attempt at contract modification, which itself may not be enforceable w/out additional consideration (so tell your friend to say "sure I'll sign it, but not before I get additional compensation").
posted by herc at 11:30 AM on May 25, 2006

I'd just like to make something clear: defamation isn't illegal. It's actionable (in civil court) but it isn't criminal.

IANAL but my own opinion is that the clause would actually be enforceable in court if your friend signed that waiver.
posted by Steven C. Den Beste at 11:31 AM on May 25, 2006

I will never understand why people even consider signing papers like this. But I do understand why employers keep drafting papers like this — because for some inexplicable reason, people keep signing them.

Part of being an adult is saying, "No."

To answer your last question: No, the company cannot lawfully deny that your friend worked for them. And although they could give a bad reference (e.g., "He was late and lazy and drunk"), most companies have strict policies forbidding that because they know it's a quick route to the losing end of a lawsuit. You're talking about a large corporation, and most large corporations have a policy, when asked, of confirming dates of employment without further comment.
posted by cribcage at 11:32 AM on May 25, 2006

I don't think that the waiver can prevent the former employee from pursuing a lawsuit, but it might make it a bit harder to win. Otherwise, it seems to be a vehicle that the HR dept has created to cover their asses. I'm guessing, however, that the reference they would give wouldn't change even if your friend signed.

Those above are right: there is no point in signing if there is nothing in it for him.
posted by lester at 11:34 AM on May 25, 2006

he has no recourse even if they lie and say he's an axe murderer.

This isn't entirely true. Just because you sign a waiver doesn't necessarily mean you won't have a case if you later take them to court. Waivers aren't 100% foolproof, especially a waiver like the one described here that basically signs away any and all rights. You can still sue the company if they blatantly lie about you, and you might win. The fact that you've signed a waiver doesn't preclude a lawsuit or mean that you automatically lose.

This is the kind of thing that, if deemed important enough, should be discussed with a lawyer experienced with the local laws applicable to the situaton, before signing the waiver.
posted by gwenzel at 11:35 AM on May 25, 2006

Perhaps I'm being naive here, but it seems like it might be a good idea to ask someone from HR what was intended with this release. Especially if your friend plans to otherwise not sign the document. Admittedly, their description of the document and the intentions behind it would be of no value in court, but I'm assuming your friend doesn't really want to sue them anyway.
posted by HiddenInput at 11:43 AM on May 25, 2006

He probably won't need the company's official reference anyway- a co-worker or manager can give him a reference.

I can't think why he would sign. Are they offering him a huge chunk of money if he does?
posted by small_ruminant at 11:43 AM on May 25, 2006

This sort of waiver is actually very common. Some companies go as far as to make signing the waiver a prerequisite to receiving any severance (or even your final check) that might be due. Legal? Beats me. Skanky-paranoid? Probably.
I'm surprised there isn't anything there for your friend to sign that precludes him saying anything negative about the company.
posted by Thorzdad at 11:44 AM on May 25, 2006

Don't sign it.
posted by tadellin at 11:52 AM on May 25, 2006

photocopy the waiver, and if a future potential employer says the company would not verify employment, show them the waiver and explain it is because you would not sign away your rights. and definitely have a copy of your most recent performance review, your earliest pay stub/hiring agreement, etc.

if they are threatening to hold pay/unused vacation time pay, etc., sign it with "I DO NOT AGREE TO THIS" in some fancy cursive. Chances are the HR person won't give it a second glance. Or, get a lawyer involved at that point.
posted by mikepop at 12:01 PM on May 25, 2006

I would say,
"no." If they try to discuss it, I would ask them if they've actually read it. If they say yes, I'd ask them if they would sign it. If they say yes, I'd ask them why.

If they pressed further I'd have a hard time not telling them that you find the fact that they asked you to sign such a document to be a signal of such incredibly bad faith that I'm sure I must already have some excellent reason to sue them.
posted by Good Brain at 12:18 PM on May 25, 2006

As an employment lawyer, let me just say a couple of things*:

• The agreement probably would not be enforceable even if he signed it because there's no consideration. In other words, for any contract to be valid, both parties must receive something of value; otherwise, it's just an unenforceable unilateral promise. (I assume he's not being offered any sort of payment for signing)


• I would not sign the agreement


• If he doesn't sign, and the employer thereafter made an affirmative misrepresentation (i.e., "Nope, he never worked here"), that would be defamatory, and would probably also fall within the tort (civil wrong) of "tortious interference with prospective economic advantage."

*this is not legal advice. I am not your friend's lawyer, blah blah blah
posted by pardonyou? at 12:31 PM on May 25, 2006

Yeah, he's not being offered any payment for signing.

Ok. Thanks for the responses. I'll make sure he keeps a copy of this, a recent performance review (wherein he got his fourth raise in 12 months) and hope that covers it.
posted by InnocentBystander at 12:48 PM on May 25, 2006

Uh, if he's worried about this place claiming that he never worked there, wouldn't things like PAY STUBS suffice?

Call a lawyer and ask them. Have him do that ASAP. Or, (and IANAL, but my lawyer friend oughta be rolling into the office in a couple hours) - cross out the items that he doesn't agree with and then sign it?
posted by drstein at 12:52 PM on May 25, 2006

1. Don't sign that under any circumstances.
2. When asked for a reference, don't give out HR's phone number. Give them the number of a co-worker or (preferably) a supervisor who is personally familiar with your friend's work. He'll get a better reference that way, anyway.
posted by ook at 12:57 PM on May 25, 2006

I'll make sure he keeps a copy of this...

If only for the story. He'll want to relate this at a dinner party one day, and no one will believe him without proof. "Up to and including intentional defamation of character" sounds pretty damn fantastic.
posted by cribcage at 1:24 PM on May 25, 2006

I will never understand why people even consider signing papers like this. But I do understand why employers keep drafting papers like this — because for some inexplicable reason, people keep signing them.

Part of being an adult is saying, "No."

I had an employer that tried to pull a similar stunt, though (1) the terms were far less insane and (2) the company had promised me a large signing bonus and never delivered on it.

The owner of the company and I went out for coffee one day. After ordering our drinks and sitting down, the guy informs me that I'm being let go, and asks me to sign one last contract. In thanks for the 15 minutes of warning and the public execution, I took a careful look at the document before signing. Just like in this case, the company wanted to force me to do various things, but offered me nothing in consideration. I took out my pen, crossed out some terms I didn't like, and noted that I would be happy to comply with the remaining terms as soon as the promised bonus was paid in full.

I was surprised, and somewhat amused when the guy completely lost his cool, grabbed the (unsigned) document from me, and stormed out of the cafe.

Sometimes the best response to unreasonable demands is slightly less unreasonable demands.
posted by b1tr0t at 1:28 PM on May 25, 2006

Just so people know, this place is probably one of the biggest employers of non-blue collar employees in our area.

It is a large student loan corporation given to unethical activities and that routinely buys congressmen to make it harder for you to default on your loans. They used to be, though, a decent enough place to work -- until they got a new president. Now they're not good guys at any point in the cycle.
posted by InnocentBystander at 2:00 PM on May 25, 2006

IB: Say nothing further.

And mark paragraph 1 of MikePop's as a Good Answer.
posted by megatherium at 2:18 PM on May 25, 2006

I don't understand why he would sign it. It seems crazy. Does he get a bigger serverance package if he does or something?
posted by delmoi at 6:19 PM on May 25, 2006

Take it to the press :D.
posted by beth at 2:35 AM on May 26, 2006

Some companies go as far as to make signing the waiver a prerequisite to receiving any severance (or even your final check) that might be due. Legal? Beats me.

There are NO legal grounds to withhold a final paycheck (including, normally, pay for unused vacation time). There are state agencies (department of labor, department of industries, etc.) that will be more than happy to discuss the matter with a company, since this is so cut-and-dried.

As for severance pay - pay that the company CHOSES to give or not give - yes, they can attach conditions to that. Typically, an employee is asked to agree not to say anything derogatory about a company (saying something truthful, but negative, is included as "derogatory"), and the company has the legal right to demand the severance pay be paid back if the employee violates the severance agreement. [But that's not the case here - severance pay isn't involved.]
posted by WestCoaster at 7:09 AM on May 26, 2006