Entergy Operations terminated the employment of Oubre, who then signed a severance agreement containing a broad release of claims in exchange for a monetary package paid in installments. The release purported to waive, among other claims, age discrimination claims under the Age Discrimination in Employment Act (ADEA). However, the agreement did not comply with several express requirements of the Older Workers Benefit Protection Act (OWBPA), which sets minimum standards for a knowing and voluntary waiver of ADEA rights. In particular, the release failed to provide the statutorily mandated consideration and revocation periods and other written safeguards OWBPA requires. After accepting and retaining the severance payments for a period of months, Oubre filed an ADEA suit alleging unlawful age discrimination. Entergy argued that the release barred the suit and that, in any event, Oubre could not proceed without first returning the severance consideration (the so-called tender-back rule) or that her retention of the benefits ratified the release. The lower courts sided with the employer on tender-back principles, but the Supreme Court granted review to resolve whether OWBPA permits enforcement of a noncompliant ADEA waiver based on tender-back or ratification doctrines.
Whether an employee who signed and retained benefits under a release that does not satisfy OWBPA's requirements is barred from pursuing an ADEA claim absent first tendering back the severance consideration, or whether the noncompliant release is unenforceable regardless of tender back or purported ratification.
Under the OWBPA, an individual "may not waive" any right or claim under the ADEA unless the waiver is knowing and voluntary, and a knowing and voluntary waiver exists only if specific minimum requirements are met. 29 U.S.C. § 626(f)(1). Those include, among other things: (a) a written agreement in plain language; (b) a specific reference to ADEA rights or claims; (c) no waiver of claims arising after execution; (d) consideration in addition to anything already owed; (e) written advice to consult an attorney; (f) at least 21 days to consider (or 45 days in a group reduction); and (g) at least 7 days to revoke after signing. If these statutory conditions are not satisfied, the waiver is invalid and cannot bar an ADEA action. Common-law tender-back or ratification doctrines cannot be used to validate a noncompliant waiver; instead, the employer's protection lies in equitable setoff or credit for payments already made against any eventual recovery.
A release that fails to satisfy OWBPA's requirements is unenforceable to waive ADEA claims, and the employee need not tender back consideration before bringing suit. Tender-back and ratification doctrines do not cure a noncompliant OWBPA waiver.
The Court began with the statutory text: OWBPA provides that an individual "may not waive" any ADEA right or claim unless the waiver is knowing and voluntary, and the statute then defines knowing and voluntary through detailed, mandatory conditions. By using unqualified language and a comprehensive checklist, Congress made strict compliance a prerequisite to an enforceable ADEA waiver. The release here failed to meet multiple OWBPA requirements (including the mandated consideration and revocation periods and other written safeguards), and thus could not operate as a waiver of Oubre's ADEA claim. The employer's tender-back argument invoked common-law rescission: that a party wishing to avoid a contract for invalidity or fraud must first return the consideration. The Court rejected that approach for OWBPA. Requiring tender back would conflict with Congress's design by allowing employers to enforce noncompliant waivers unless and until employees—who often depend on severance to bridge a job loss—could repay the money. That would undermine the statute's protective purpose and chill meritorious ADEA claims. Similarly, common-law ratification principles could not supply validity; Congress erected an explicit statutory gate, and private conduct (like retaining severance payments) cannot open it when the statutory key is missing. Finally, the Court emphasized that refusing to impose a tender-back prerequisite does not unfairly penalize employers. Courts may offset severance or other consideration already paid against any back pay or damages ultimately awarded, preventing double recovery by the employee while preserving OWBPA's statutory protections. In short, the OWBPA's clear text and purpose foreclose enforcing noncompliant waivers through tender-back or ratification, and the appropriate remedy for employers lies in setoff, not in conditioning access to the courthouse.
Oubre cements that OWBPA's waiver requirements are strict and not subject to common-law end-runs. For practitioners, the decision is a drafting directive: severance releases involving potential ADEA claims must meticulously track OWBPA's checklist (including attorney-advice language, the 21-day consideration and 7-day revocation periods, and an express reference to the ADEA). For litigators, Oubre eliminates tender back as a defense to ADEA suits based on noncompliant waivers and frames setoff as the equitable safeguard against double recovery. More broadly, it demonstrates how statutory rights can displace common-law doctrines when Congress creates a comprehensive remedial scheme, making the case a staple in courses on Employment Law, Contracts, and Statutory Interpretation.
Oubre v. Entergy Operations stands for a straightforward but powerful proposition: when Congress sets explicit conditions for waiving federal statutory rights, courts must enforce those conditions as written. OWBPA's checklist is not advisory, and releases that bypass it do not extinguish ADEA claims. By decoupling access to the courthouse from a tender-back requirement, Oubre ensures that employees are not deterred from vindicating statutory age-discrimination rights by financial hurdles Congress did not impose.