Does OWBPA apply to international workers?
Updated: Jun 21
We recently posted a high-level low-down on OWBPA and its goal of preventing age discrimination in the workplace. Simply put, the Older Worker Benefit Protection Act (OWBPA) mandates that employers follow certain requirements when offering severance to workers aged 40+ in exchange for a waiver of claims under the Age Discrimination in Employment Act (ADEA). When dealing with group layoffs (two or more employees), these waivers of claims must disclose detailed information about all employees considered for layoff, including titles and ages.
How does that apply to international workers? This is where things have often become complicated. Let’s say that the decisional unit (employees for layoff consideration) was made up of data analysts. If the U.S.-based employer also has non-U.S. citizen data analysts working internationally, wouldn’t they need to be included in the mandated list of employees considered for layoff? Earlier this year, the Equal Employment Opportunity Commission (EEOC) answered with a semi-resounding no; non-U.S. citizen employees working internationally do not need to be included under OWBPA.
More specifically, the EEOC wrote:
After careful consideration of the ADEA, the Commission concludes that employers subject to the requirements of the ADEA are not required to include in OWBPA disclosures employees working outside the United States who are not U.S. citizens because such individuals are not “employees” for purposes of the ADEA.
Further, the EEOC went on to cite several reasons that international workers should not be included in OWBPA disclosures:
International workers do not meet the definition of an “employee” under the ADEA. The ADEA protects workers in the U.S. (regardless of citizenship status) and U.S. citizens working outside the U.S. for American employers. It does not protect non-U.S. citizens working for such firms outside the United States.
Inclusion of international workers could lead to confusion. If non-covered employees (i.e., non-U.S. citizens working internationally) are listed, this could mislead covered employees to the point of hiding unlawful discrimination. Plus, this could jeopardize the requirement that ADEA waivers be “clearly understood.”
Foreign countries may have different separation policies, disrupting the OWBPA’s requirement that benefits be standardized. OWBPA regulations require a standardized formula or benefits package in exchange for employees’ decision to sign a waiver. Therefore, variations in separation benefits would undermine the effort of uniformity.
Though OWBPA can be complicated, the EEOC’s recent opinion provides clarity when dealing with international workers. Developing compliant separation agreements is still no walk in the park, but OWBPA is a little bit easier.
Onwards HR is a data-driven separation platform that automates severance and mitigates human capital risk.