The OWBPA Omission

MISSING: A Very Important Document

If you work in HR, chances are you have a separation story. I previously shared The $500K Mistake, but I’ve got another one worth telling. This one is called “The OWBPA Omission.”

Not too long ago, I met with a former HR executive at an enterprise company. Like many other stories I’ve heard, she shared that the organization struggled with separations. Reductions in force were managed using Excel spreadsheets and mail merge functionality — even during a separation event with more than 650 impacted employees. The process was time-consuming and created too much room for error, which left the team feeling exhausted and fearful.

The worst part of this story is that, even though this executive managed the separation process, her own severance package was missing an important document — the Older Workers Benefit Protection Act (OWBPA) disclosure that is mandatory when a reduction in force impacts 2 or more employees over 40 years old. Whoops.

In this example, the employee politely asked for the disclosure, but the same can’t be said for a similar incident at IBM. The company failed to assess for compliance with Title VII and generate the required OWBPA disclosures, resulting in an EEOC lawsuit that will likely cost millions.

Though separations are a tough topic, they are a reality in the business world. Companies want to treat their employees fairly. However, without the right processes in place, errors will happen that put the business at risk. Want to see a new approach to handling separations? Schedule a demo.