The Moore Decision: Examining the “Voluntariness” of Waivers of Title VII Claims in Last Chance Agreements

In August, the U.S. 6th Circuit Court of Appeals (6th Circuit) issued its decision in Moore v. Coca-Cola Bottling Co. Consol.,[1] reversing the lower court’s grant of summary judgment in favor of the employer, upon finding a genuine question of material fact as to the voluntariness of Title VII waivers in a Last Chance Agreement.

A year before his termination, the employee signed a Last Chance Agreement (LCA). This LCA contained a provision in which the employee agreed to “release and forever discharge the Company and the Union ... from any and all liability of any kind, whatsoever, relating to his employment with the Company, arising prior to the date of the LCA.”[2] Despite this provision, after his termination, the employee brought Title VII discrimination claims against the employer that predated the LCA.

Before the district court, the employer argued that it was entitled to summary judgment on grounds that the employee had knowingly and voluntarily entered the LCA, thereby waiving such claims. Conversely, the employee argued that the LCA waiver was involuntarily signed and thus could not be enforced.

The district court agreed with the employer and granted its motion for summary judgment. The 6th Circuit reversed and remanded the district court decision, finding that there was a genuine dispute of material fact as to whether the plaintiff-employee’s waiver was voluntary. In September, the court denied a petition for rehearing en banc.[3]

In reversing the lower court, the 6th Circuit highlighted that it “recognized that under particular circumstances employers and employees may negotiate a valid release of  ... Title VII claims.”[4] In short, courts will enforce a Title VII waiver if the employee entered into the waiver voluntarily. When examining voluntariness, courts apply an objective-subjective test, by asking “whether a reasonable person (objective) would have understood that they were waiving their rights based on a number of factors particular to the employee at issue (subjective).”[5] To determine the validity of a particular waiver, courts apply a totality-of-the circumstances test, examining: “(1) the plaintiff’s experience, background, and education; (2) the amount of time the plaintiff had to consider whether to sign the waiver, including whether the employee had an opportunity to consult with a lawyer; (3) the clarity of the waiver; (4) consideration for the waiver; as well as (5) the totality of the circumstances.”[6]

Considering these factors, the court found that several facts could support a reasonable jury in finding that the employee’s waiver was involuntary. For instance, the court noted that the meeting at which the employee signed the LCA lasted no longer than 10 minutes, with only a fraction of that time dedicated to actually discussing the LCA itself. Additionally, the employee did not have an attorney present at the meeting and the union representative in attendance gave the employee potentially confusing guidance.

Rather controversially, the court also stated that the plaintiff’s education — he held both an associate’s and bachelor’s degree — did not weigh in favor of a determination of voluntariness. The court explained that the plaintiff’s “education does not provide him with any type of legal, managerial, or contractual background that would be relevant to interpreting the LCA’s terms in a manner essentially at odds with what the union representative told [him].”[7] Furthermore, the plaintiff did not have previous experience with LCAs specifically.

Additionally, the court expressed concerns about the language of the release itself, stating that “[i]n other cases where we have found that such provisions are straightforward in their terms, the contracts have explicitly stated that the employee was waiving the right to bring a discrimination suit.”[8] In contrast, the LCA the employee signed in Moore only stated that it was releasing “any and all liability of any kind whatsoever relating to his employment” which the court found to be imprecise. The court highlighted that “the clearer the waiver or the more assistance a person receives in understanding an agreement, the less significant is any particular experience or background to finding knowing and voluntary waiver.”

Here, the court reasoned the waiver at issue was not clear and the employee had no experience or background to assist him in clarifying. Accordingly, the court felt that a reasonable jury could find the waiver involuntary and thus the district court’s grant of summary judgement was inappropriate.

In her firm dissent, Judge Batchelder wrote that she would have upheld the lower court’s grant of summary judgment, finding the document “very clear” and noting that it was only one page long.[9] The dissent characterizes the majority’s reasoning as a “distortion” which “creates a new requirement that signors [of LCAs] must have highly relevant education.” The dissent further highlighted that plaintiff had two degrees, experience with Second Chance Agreements, and union representation during the meeting.   

The Macomb Decision: Skirting the Baylor/IGT Issue

In September, the 6th Circuit issued its decision Nat’l Lab. Rels. Bd. v. Macomb.[10] This decision was the court’s rather anti-climactic response to the McLaren Macomb[11] decision of the National Labor Relations Board (NLRB), which made waves throughout employment law circles when it was decided in 2023. In McLaren Macomb, the NLRB treated broad non-disparagement and confidentiality provisions in severance agreements as a waiver of the signing employees’ Section 7 rights. Accordingly, the board determined that such broad provisions unlawfully restrain and coerce employees in their exercise of their Section 7 rights. Because employees may not broadly waive their rights under the NLRA,[12] the board held that the mere proffer of such an agreement violates the act, even absent any other unfair labor practice. In so holding, the NLRB explicitly overruled both Baylor University Medical Center[13] and IGT d/b/a International Game Technology.[14]

On appeal to the 6th Circuit, the employer appealed, among other issues, whether the severance agreements violated Section 8(a)(1). The 6th Circuit neatly side-stepped the burning issue by focusing on the fact that the specific severance agreements in question were “part and parcel” of the employer’s clearly illegal direct dealing with union-represented employees. Accordingly, while the court acknowledged the contentious debate surrounding the board’s decision to overturn Baylor and IGT, the court explicitly refused to consider the issue,[15] as the employer’s actions would have been a violation even under the more lenient Baylor/IGT standard.

Moving Forward

In light of these two decisions, employers should remember that McLaren Macomb remains the law of the land as it pertains to confidentiality and non-disparagement provisions in severance agreements. However, employers should keep a careful eye on developments, as seismic shifts are expected with the upcoming change of presidential administrations.

Additionally, pursuant to Moore, employers should ensure that waivers of Title VII rights include explicit language stating that the employee is releasing discrimination claims. Furthermore, employers should consider the signing employee’s education and experience and ensure that the employee has clearly documented support in their decision making.

Bethany Westcott Wilson is an associate of Kramer Rayson LLP in Knoxville, Tennessee, where she practices labor and employment law, focusing on complex federal and state leave law issues. She graduated from Lee University in 2017 and The University of Tennessee College of Law in 2024.