OWBPA

OWBPA decisional unit disclosure template

When your RIF includes employees 40 or older and you are asking them to waive ADEA claims, the OWBPA requires a specific written disclosure. This guide explains what it must contain and why getting it wrong makes the waiver void.

ADEAOWBPAGroup TerminationSeverance

45 days

Consideration period

7 days

Right to revoke

Void

Not voidable

OverviewWhen it appliesThe decisional unitDisclosure requirementsConsideration periodDownload templateWhat voids a waiverFAQ

What is the OWBPA disclosure?

The Older Workers Benefit Protection Act (OWBPA) is an amendment to the Age Discrimination in Employment Act (ADEA) that sets specific requirements for waivers of age discrimination claims. When an employer conducts a group exit program — any program involving two or more employees — and asks participants to release ADEA claims as part of a severance agreement, the OWBPA requires a written disclosure listing the job title and age of every employee in the decisional unit.

The disclosure serves a specific purpose: it allows each affected employee to evaluate whether the selection pattern suggests age discrimination before deciding whether to sign away their right to sue. Without this information, the EEOC and Congress concluded that employees could not make an informed waiver decision.

A defective waiver is void, not voidable

Unlike other employment waivers, an OWBPA waiver that fails to meet all statutory requirements is void as a matter of law. The employee keeps the severance and retains the right to sue. There is no post-signing cure. The disclosure must be complete and correct before any severance agreement is presented to employees.

When OWBPA group termination rules apply

The group termination rules (including the decisional unit disclosure and 45-day consideration period) apply when all three conditions are met:

Two or more employees

Are being terminated as part of the same exit program or RIF — even if notifications happen on different days.

At least one employee is 40+

Even if most employees in the program are under 40, if any participant is 40 or older and signing a release, OWBPA group rules apply to the entire program.

Employees are asked to waive ADEA claims

The waiver obligation is triggered by the release, not by the termination itself. If you are not asking employees to sign a release of claims, OWBPA disclosure is not required.

Most common misunderstanding

If even one participant in your RIF is 40 or older and you are asking employees to sign a release, OWBPA group rules apply to the entire program — including the decisional unit disclosure and 45-day consideration period for all participants, regardless of age. A program with 9 employees under 40 and one employee who is 42 still requires full OWBPA compliance.

Individual termination agreements (one employee, not part of a group program) have a different standard: 21-day consideration period and no decisional unit disclosure requirement. If you are running a RIF with multiple employees, assume the group rules apply and proceed accordingly.

Defining the decisional unit

The decisional unit is the group of employees from which the employer made selections. It is not just the group of employees who were chosen — it includes everyone who was considered. Defining it too narrowly is one of the most common OWBPA defects.

Department

All employees in the Finance department, regardless of level

Job family

All Senior Engineers company-wide, across all locations

Business unit

All employees in the Consumer Products division

Geography

All employees at the Chicago and Detroit offices

Level / grade

All Director-level and above employees across the company

Company-wide

All employees at the company (used for broad restructurings)

Key rule

If different groups of employees were selected using different criteria or different decision-makers, you may have multiple decisional units, each requiring its own disclosure. Combining groups that were not genuinely part of the same selection decision into one unit — or splitting a genuine unit to reduce its apparent size — can invalidate the waiver. Have counsel confirm the unit definition before preparing the disclosure.

What the disclosure must contain

The OWBPA statute (29 U.S.C. § 626(f)(1)(H)) specifies the required contents. The disclosure must list, for every employee in the decisional unit:

Field

Required by statute

In template

  • Job title

    Use the actual job title, not a generic description.

    Yes

  • Age

    Must be accurate. An incorrect age can void the waiver for that employee.

    Yes

  • Selected / not selected

    Each row must indicate whether the employee was offered the program.

    Yes

  • Department / location

    Not required by statute, but helps employees understand the selection scope.

    No

  • Employee name

    Not required. Some courts have required names when titles alone identify individuals.

    No

The same completed disclosure goes to every employee in the exit program. It must be complete at the time the severance agreement is presented — you cannot present the agreement and deliver the disclosure later.

Consideration and revocation periods

45

Days to consider

For group terminations. The clock starts when the employee receives both the agreement and the complete decisional unit disclosure. Providing the disclosure late shortens the effective period and may void the waiver.

7

Days to revoke

After signing, the employee has 7 days to revoke the waiver. The waiver is not effective — and severance should not be paid — until the revocation period expires without revocation.

Employees can sign before 45 days — but you cannot pressure them to

An employee may voluntarily sign before the 45-day period expires. The waiver is valid as long as the full period was offered and no pressure was applied to sign early. Statements like "the offer expires in two weeks" when the statute requires 45 days can void the waiver. Document that each employee was informed of the full consideration period.

Download the template

3 tabs

Instructions, Disclosure table, Guidance & waiver checklist

50-row table

Pre-formatted disclosure table, ready for your employee data

Waiver checklist

8-point OWBPA compliance checklist included in tab 3

Free download

OWBPA Decisional Unit Disclosure Template

Pre-formatted Excel workbook with the disclosure table, instructions, decisional unit guidance, and an OWBPA waiver checklist.

What invalidates an OWBPA waiver

Unlike most contract defects, OWBPA defects cannot be ratified or cured after signing. Each of the following independently voids the ADEA waiver — the employee keeps the severance and retains the right to sue.

Incomplete decisional unit disclosure

Disclosure defect

Omitting any employee from the unit — whether selected or not — voids the waiver for all participants who received the defective disclosure.

Incorrect ages in the disclosure

Disclosure defect

An employee listed with the wrong age received inaccurate information on which to base their waiver decision. Courts have held individual waivers void on this basis.

Disclosure delivered after the agreement

Timing defect

The 45-day clock runs from receipt of both documents together. Delivering them separately shortens the effective period below the statutory minimum.

Using 21 days instead of 45

Timing defect

The 21-day period applies only to individual (non-group) agreements. Any RIF with two or more employees requires 45 days. This is the single most common OWBPA error.

Pressuring employees to sign early

Timing defect

Statements like "the offer expires in two weeks" when the statute requires 45 days void the waiver, even if the employee signed voluntarily.

Missing 7-day revocation right

Agreement defect

The agreement must expressly include the right to revoke within 7 days and explain how revocation works. Omitting it voids the waiver.

Agreement does not specifically reference ADEA

Agreement defect

A general "all claims" release is insufficient. The agreement must specifically reference the Age Discrimination in Employment Act by name.

Paying severance before the revocation period expires

Process error

Severance may not be paid until the 7-day window closes without revocation. Paying early does not accelerate the waiver — it creates a recovery problem if the employee later revokes.

Not updating the disclosure when the RIF scope changes

Process error

If employees are added to or removed from the program after the initial disclosure is sent, a corrected disclosure must be issued and the 45-day clock restarts for everyone who received the original version.

Free download

Get the full RIF compliance checklist

66 steps across 9 phases, from selection criteria through post-RIF close-out. Formatted as an Excel workbook your team can track in real time.

Frequently asked questions

What is the OWBPA decisional unit disclosure?

When two or more employees are terminated as part of the same exit program and asked to waive ADEA claims, the Older Workers Benefit Protection Act (OWBPA) requires that each employee receive a written disclosure listing the job title and age of every employee in the decisional unit — both those selected for the program and those not selected. This disclosure must be attached to the severance agreement before the employee signs.

What is the decisional unit under OWBPA?

The decisional unit is the group of employees from which the employer chose who would be offered the exit program. It is defined by the scope of the selection decision: it may be a department, a job family, a geographic location, a business unit, or the entire company. The unit must include all employees who were considered for the program, not just those who were selected.

How long does an employee have to consider an OWBPA waiver in a group termination?

For group terminations (two or more employees in the same program), the OWBPA requires a 45-day consideration period — not the 21 days that applies to individual termination agreements. The 45 days runs from when the employee receives the agreement and the complete decisional unit disclosure. After signing, the employee has 7 days to revoke the waiver.

What happens if the OWBPA disclosure is missing or incorrect?

An OWBPA waiver that does not meet all statutory requirements is void as a matter of law — not voidable, but void. This means the employee retains the right to sue for age discrimination under the ADEA while also keeping any severance paid. There is no post-signing cure for a defective OWBPA waiver. Common defects include: omitting employees from the decisional unit disclosure, listing incorrect ages, failing to provide the 45-day consideration period, and omitting the 7-day revocation window.

Does the OWBPA disclosure need to include employee names?

No. The OWBPA statute requires disclosure of job titles and ages — not names. Most employers include job titles and ages only, which is sufficient. However, if your workforce is small enough that job titles alone identify individuals, courts have sometimes held that a more specific disclosure is required to give employees a meaningful picture of the selection. Have counsel confirm the appropriate level of detail for your decisional unit size.

Does the OWBPA apply to employees under 40?

The OWBPA governs waivers of ADEA claims, which only protect employees 40 and older. However, if your RIF includes any employees 40 or older who are being asked to sign a release, the OWBPA requirements apply to the entire program — including the decisional unit disclosure provided to all participants, regardless of age. The disclosure itself goes to every employee in the exit program.

People Plan

OWBPA disclosures generated automatically

People Plan generates the completed OWBPA decisional unit disclosure from your employee data, calculates the correct consideration period for each employee, and flags any waiver defects before severance agreements go out.

Legal disclaimer

This guide and template are provided for general informational purposes and do not constitute legal advice. OWBPA requirements are fact-specific and courts apply them strictly. Always have employment counsel review severance agreements and decisional unit disclosures before presenting them to employees. People Plan is not a law firm.