The Failure to Rehire After a Release - A Common Sense View from the 6th Circuit

Just 3 days before Christmas, the 6th Circuit held that an employee who had signed a release of his age claim in return for an enhanced severance could not claim that the failure to rehire him was age discrimination. The Kellogg Company v. Sabhlock (6th Cir. 12/22/06) [pdf].

Although the Court was careful to point out that it was not setting an all encompassing rule — "Under some facts a general release will bar a subsequent failure to rehire claim and under other facts it will not. It depends on how closely related the rehire is to the original termination in terms of time and subject matter." — and Kellogg had done its job by including an agreement that it had no obligation to rehire him at any time in the future, it was still a nice Christmas gift for employers faced with a problem that appears almost insoluble if discrimination and retaliation statutes are interpreted literally.

Here the 6th Circuit avoided both an unfair result and perhaps more importantly for others a rule that would discourage enhanced payments in return for releases, by holding that "his claim of age discrimination in the failure to rehire arose out of his termination and cannot be the basis for a separate claim. After releasing an age discrimination claim, the employee cannot resurrect the age discrimination claim by reapplying for employment." (my emphasis)