STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION

VERLYN E. GRAHL, Complainant

MERCURY MARINE, Respondent

FAIR EMPLOYMENT DECISION
ERD Case No. 8902050, EEOC Case No. 26G891464

An Administrative Law Judge for the Equal Rights Division of the Department of Industry, Labor and Human Relations issued a decision in the above-captioned matter on August 23, 1991. Complainant filed a timely petition for review by the Commission and both parties submitted written arguments.

Based upon a review of the record in its entirety, the Labor and Industry Review Commission issues the following:

ORDER

The decision of the Administrative Law Judge (copy attached) is affirmed and shall stand as the FINAL ORDER herein.

Dated and mailed December 4, 1992.

/s/ Pamela I. Anderson, Chairman

/s/ Richard T. Kreul, Commissioner

/s/ James R. Meier, Commissioner

MEMORANDUM OPINION

Verlyn Grahl had been employed by Mercury Marine for almost 23 years when his employment was terminated on August 2, 1989. (TR 70, 77; Exh. 1) Grahl's termination was part of a reduction in force which resulted in the termination of approximately 500 salaried employes (of which Grahl was one) and approximately 1000 hourly employes during 1989 and early 1990. (TR 16) When he was terminated, Grahl was 62 years old and his marital status was single. (TR 77-78)

Grahl received a letter on August 2, 1989, which stated that he would receive a normal severance payment of $8,132.92 and a normal pension benefit of approximately $819.76 per month, unless he notified Mercury Marine in writing by August 25, 1989, that he had elected option 1 (which provided an enhanced severance payment of $25,374.75 plus the normal pension benefit) or option 2 (which provided an enhanced pension benefit of approximately $1,041.48 but no severance payment). (TR 28-32, 36; Exh. 1) The letter further stated in pertinent part:

"In return for either one of these optional plans, the company requests that you release any and all claims arising out of your employment and its termination. Your execution of the duplicate original of this letter will indicate your decision to accept a designated optional plan and release Mercury Marine and the Brunswick Corporation of any and all claims arising out of your employment and its termination.
. . .
(Y)ou acknowledge, by execution of this letter, that you have no further claims against the company other than those set forth in this letter, and discharge and release Brunswick, its officers and employes, of any and all claims arising out of your employment which you have had including, but not limited to, any alleged violation of state or federal measures which prohibit employment discrimination.

Please execute and return the duplicate original of this letter. If we do not receive an executed duplicate original of this letter indicating your selection of one of the two previously described options on or before August 25, 1989, we will assume that you have decided not to accept these extended programs under the conditions outlined above. In such case, you will receive severance pay and benefits in accordance with normal policy.
. . .
In consideration of the extended severance or pension benefits to be received hereunder, I hereby release any and all claims against Mercury Marine and Brunswick corporation arising out of my employment and the termination thereof. I elect:

_____ Option 1 - Extended severance.

_____ Option 2 - 3 years added to age & service for pension determination." (Exh. 1)

Grahl attended a meeting at which the benefit options were explained but the only mention of the release language was a statement that Mercury Marine had reviewed each termination and had determined that no discrimination had occurred. (TR 7-8, 99-100, 118) Grahl was not given an opportunity to negotiate other options and he was not encouraged to consult an attorney. (TR 7-9, 81, 129, 135-136)

When Grahl was weighing his options, he paid particular attention to what his severance payment and pension benefits would be. (TR 88-95, 110, 114, 123-124) He never thought about having an attorney review the release, but, prior to making his decision, he knew that it was illegal for an employer to discriminate against an employe on the basis of sex and marital status. (TR 103, 130, 132)

On August 9, 1989, Grahl wrote a letter to Michael Frydryk, the Director of Employe Compensation, concerning the calculation of his pension benefit and requesting an upward adjustment of same. (TR 20-21, 95; Exh. 2) Grahl wrote the letter in the hope that he could negotiate an increased pension benefit. (TR 95-96, 125-126) On August 14, 1989, prior to receiving a response from Frydryk 1 (1),

Grahl signed and returned the release, electing option 2. (TR 37, 102; Exh. 1) Underneath his signature, Grahl made a handwritten note which stated:

"Note: -For pension plan computation my Social Security at age 65 is $790 per month. Note also my letter to Mike Frydryk dated August 9, 1989." (TR 45; Exh. 1)

Grahl made the notation because he was still hoping to negotiate an increased pension benefit. (TR 102-103, 125-126) When Grahl signed the release, he understood that he did not have to sign it, and that he would have received a severance payment of $8,132.92 plus a normal pension benefit if he did not sign it. (TR 112-113) He claims, however, that he was under duress when he reviewed the options and was making up his mind, that he did not understand (specifically that it did not "register" with him) that he would be waiving his right to file a discrimination complaint when he signed the release (even though he acknowledges that he read the release language), and that he did not intend to waive his rights. (TR 110-118) When Grahl's employment was terminated, he was working in a salaried position as a material control coordinator. (TR 27-28, 71, 77) Grahl had a high school education and had taken two college courses. (TR 77) Grahl testified that "I'm a School Board member. I'm in my 30th year at the Campbellsport School District, and . . . I represent (sic) the Board ever since we had the Board negotiating with teachers . . ." (TR 74) He also stated that when the contracts became particularly complex, the Board hired a law firm from Milwaukee to help with negotiations. In any event, however, Grahl has been involved in negotiating labor agreements. He was self-employed as a farmer prior to his employment with Mercury Marine. (TR 70, 120-122)

On September 14, 1989, Grahl filed an age and marital status discrimination complaint against Mercury Marine. In his complaint, he alleged that he was "offered an early retirement package without . . . being able to study it and give . . . input." Mercury Marine raised the release signed by Grahl as an affirmative defense to the complaint. On August 23, 1991, Administrative Law Judge Alice DeLaO issued a decision and order dismissing Grahl's complaint.

The principal issue in this case is whether Verlyn Grahl made a knowing and voluntary waiver of his right to pursue an employment discrimination claim against Mercury Marine under the Wisconsin Fair Employment Act. (2)    Before that issue is resolved, however, Mercury Marine argues that Grahl cannot contest the validity of the release because he accepted the enhanced pension benefits and he has not returned the benefits. It is undisputed that Grahl has not returned any of the benefits. (TR 55-56) Grahl, for his part, argues that it is sufficient that he has offered to return the benefits. It is undisputed that he has made such an offer. (TR 109-110)

Grahl is correct.  In Giese and Field v. Wausau Insurance Companies, ERD Case No. 8600691 and ERD Case No. 8600731 (LIRC, October 25, 1988), the Commission affirmed the decision of ALJ David Nance that the Complainants were required to tender back the consideration received in exchange for the waiver of their rights to pursue discrimination claims, as a condition precedent to challenging the validity of the waiver.  (3)    In Doyle v. Teasdale, 263 Wis. 328, 347, 57 N.W.2d 381 (1953), the supreme court cited Charron v. Northwestern Fuel Co., 149 Wis. 240, 134 N.W. 1048 (1912), for the general rule that tender back is the condition precedent to maintaining an action to set aside a release. In Charron, 149 Wis. at 246-247, the court ruled that "tender back" means to return or to offer to return the consideration received. In this case, since Grahl offered to return the benefits in order to challenge the validity of the release, it appears that he is, therefore, entitled to make such a challenge.

Whether a party against whom a waiver is asserted had actual or constructive knowledge of the facts often presents a question of fact to be determined by the trier of the facts. Attoe v. State Farm Mut. Automobile Ins. Co., 36 Wis. 2d 539, 546, 153 N.W.2d 575 (1967). When the facts surrounding waiver are without dispute, however, an issue of law is presented. Shannon v. Shannon, 145 Wis. 2d 763, 776, 429 N.W.2d 525 (Ct. App. 1988). In this case, ALJ DeLaO determined that Grahl made a knowing and voluntary release of his rights to pursue a discrimination claim against Mercury Marine, both as a matter of fact (Finding #16) and as a matter of law (Conclusion of Law #2). Since the facts are largely undisputed, however, the Commission's analysis assumes a question of law is presented.

Wisconsin courts often look to federal court decisions interpreting federal anti-discrimination laws for guidance in applying the Wisconsin Fair Employment Act. Hamilton v. ILHR Dept., 94 Wis. 2d 611, 620-21 n. 4, 280 N.W.2d 857 (1980); Bucyrus-Erie Co. v. ILHR Dept., 90 Wis. 2d 408, 421 n. 6, 280 N.W.2d 142 (1979).   Nevertheless, Wisconsin courts "must construe Wisconsin statutes as it is believed the Wisconsin Legislature intended, regardless of how Congress may have intended comparable statutes." Goodyear Tire and Rubber Co. v. DILHR, 87 Wis. 2d 56, 65, 272 N.W.2d 786 (Ct. App. 1978); American Motors Corp. v. ILHR Dept., 101 Wis. 2d 337, 353, 305 N.W.2d 62 (1981) ("[t]here is no ipso facto incorporation of the federal Civil Rights Act in the Fair Employment Act of the State of Wisconsin").

In Alexander v. Gardner Denver Co., 415 U.S. 36, 52 (1974), the Court stated that an employe's rights under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq., could be waived if the employe's consent was knowing and voluntary. Employes also may validly waive their rights under the federal Age Discrimination in Employment Act (ADEA), 29 U.S.C. § 629 et seq ., if the waiver is knowing and voluntary. O'Shea v. Commercial Credit Corp., 55 FEP Cases 973, 976 (4th Cir. 1991). This also is consistent with the definition of a "waiver" in Wisconsin as being "a voluntary and intentional relinquishment of a known right." Attoe, 36 Wis. 2d at 539; Shannon, 145 Wis. 2d at 775.

In Wisconsin, in establishing waiver, it is not necessary to prove an actual intent to waive. Attoe, 36 Wis. 2d at 545; Shannon, 145 Wis. 2d at 775. Waiver may be established by the conduct of the parties. Id. In Attoe, the court observed:

"We deem particularly apposite the statement made by this court in Rasmusen v. New York Life Ins. Co.:

'Doubtless, the act out of which the waiver is deduced must be an intentional act, done with knowledge of the material facts, but it cannot be necessary that there would be an intent to waive. Such a rule would allow a secret intention to defeat the legal effect of unequivocal and deliberate acts.'

Here, defendants assert there was no intent on their part to waive the defense of the no-action clause. However, where waiver is established by the facts, the claim of absence of intent to waive does not overcome the waiver. In Pabst Brewing Co. v. Milwaukee, this court quoted with approval the following statement from a standard reference work:

'The intent to waive may appear as a legal result of conduct. The actuating motive, or the intention to abandon a right, is generally a matter of inference to be deduced with more or less certainty from the external and visible acts of the party, and all the accompanying circumstances of the transaction, regardless of whether there was an actual or expressed intent to waive, or even if there was an actual but undisclosed intention to the contrary.'

The knowledge of the facts by the party against whom waiver is asserted, which is held to be a necessary element of waiver, may be constructive as well as actual. Constructive knowledge is that knowledge which one who has the opportunity, by the exercise of ordinary care, to possess. It is somewhat, though not entirely, akin to constructive notice." 36 Wis. 2d at 545-546. (emphasis added, footnotes omitted); Winfield v. St. Joe Pager Co., 20 FEP 1103, 1111 (N.D. Fla. 1979) ("Plaintiffs' witnesses' own, possibly self-serving, statements as to their degree of understanding at the time they signed the releases cannot be deemed conclusive"). (4)

The ADEA incorporates the enforcement provisions of the federal Fair Labor Standards Act (FLSA). The FLSA has long been interpreted to prohibit waivers of rights under the FLSA which were not "supervised" by the Secretary of Labor or the courts. Brooklyn Savings Bank v. O'Neill, 324 U.S. 697, 706-707 (1945); Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728, 739-740 (1981). The ADEA was similarly interpreted until 1978 when Congress transferred the authority for administering and enforcing the ADEA from the Secretary of Labor to the United States Equal Employment Opportunity Commission (EEOC). In 1985, EEOC proposed a rule which would permit waivers under the ADEA without EEOC supervision, so long as the waivers were "knowing and voluntary." In order to be a knowing and voluntary waiver, EEOC required that the waiver be in writing. Although not required, EEOC, also identified certain factors as relevant to determining whether a waiver was knowing and voluntary: (1) whether the waiver was in understandable language; (2) whether it clearly waived ADEA rights or claims; (3) whether a reasonable period of time was provided for employe deliberation; and (4) whether the employe was encouraged to consult with an attorney.

In various appropriation bills from 1988 through 1990, Congress suspended the operation of the EEOC rule because Congress believed that unsupervised waivers would harm older workers. In 1990, however, Congress amended the ADEA to create, for the first time, a class of valid, unsupervised waivers. Pub. L. 101-433, effective October 16, 1990. As amended, the ADEA now provides that ADEA rights may not be waived unless the waiver is knowing and voluntary, and that a waiver may not be considered knowing and voluntary unless it meets the following minimum requirements: (1) the waiver is part of a written agreement which is written in a manner calculated to be understood by the average individual eligible to participate; (2) the waiver specifically refers to rights or claims arising under the ADEA; (3) the individual does not waive rights or claims that may arise after the date that the waiver is executed; (4) the individual waives rights or claims only in exchange for consideration in addition to anything of value to which the individual already is entitled; (5) the individual is advised in writing to consult with an attorney prior to executing the agreement; (6) the individual is given at least 21 days to consider the agreement (or 45 days in the case of a waiver connected with an exit incentive or other employment termination program offered to a group or class of employes) ; and (7) the individual has at least seven days after execution of the agreement to revoke. 29 U.S.C. § 626(f).

Prior to the amendment of the ADEA, the federal circuit courts were split as to the appropriate source of law to be used in assessing the validity of a particular waiver. O'Shea, 55 FEP Cases at 976. The Second, Third, and Fifth Circuits applied a more stringent federal "totality of the circumstances" test. Bormann v. AT&T Communications, Inc., 49 FEP Cases 1622 (2nd Cir. 1989); Coventry v. United States Steel Corp., 47 FEP Cases 1560 (3rd Cir. 1988); O'Hare v. Global Natural Resources, Inc., 52 FEP Cases 1139 (5th Cir. 1990). The Fourth, Sixth, and Eighth Circuits applied ordinary contract principles in determining whether a release was knowing and voluntary. O'Shea, 930 F.2d at 362; Runyon v. National Cash Register Corp., 41 FEP Cases 1712 (6th Cir. 1986); Lancaster v. Buerkle Buick Honda Company, 42 FEP Cases 1472 (8th Cir. 1987). The Seventh Circuit in Riley v. American Family Mut. Ins. Co., 50 FEP Cases 668 (7th Cir. 1989), did not take a definitive position on the issue one way or another.

The courts that apply the "ordinary contract principles" test tend to focus on whether the language of the release is unambiguous and whether there has been any fraud or duress. O'Shea, 55 FEP Cases at 976; Lancaster, 42 FEP Cases at 1473. Even these courts, however, look at other facts such as whether the employe read and considered the terms of the release before signing it, whether the employe had adequate time to consider the release, whether the employe negotiated the release, whether the employe had an opportunity to consult an attorney, and whether the employe has experience with business and with contracts. Lancaster, 42 FEP Cases at 1473; see Coventry, 47 FEP Cases at 1567 n. 9. The appellate courts that apply the "totality of the circumstances" test generally restate the formulation of that test by the district court in EEOC v. American Express Publishing Corp., 47 FEP Cases 1596, 1598-1599 (S.D. N.Y. 1988), where the court stated:

"Determination whether a release is voluntary depends on: (1) the plaintiff's education and business experience, (2) the amount of time the plaintiff had possession of or access to the agreement before signing it, (3) the role of the plaintiff in deciding the terms of the agreement, (4) the clarity of the agreement, (5) whether the plaintiff was represented by or consulted with an attorney, and (6) whether the consideration given in exchange for the waiver exceeds employe benefits to which the employe was already entitled by law or contract. Coventry, 47 FEP Cases at 1567; Bormann, 49 FEP Cases at 1625; O'Hare, 52 FEP Cases at 1141. In Cirillo v. Arco Chemical Co., 48 FEP Cases 678, 680 (3rd Cir. 1988), the court added two factors: whether the employe was encouraged to consult an attorney (5) and whether the employe knew or should have known his or her rights upon execution of the release. The court in Cirillo also recharacterized the factor concerning whether the employe had a role in deciding the terms of the agreement as a factor concerning whether there was an opportunity for negotiation of the agreement."

The courts that prefer the totality of the circumstances test do so because they believe that it is more "consistent with the strong congressional purpose underlying the ADEA to eradicate discrimination in employment." Bormann, 49 FEP Cases at 1625; Coventry, 47 FEP Cases at 1567. It is more likely to prevent older workers from being coerced or manipulated into giving up their rights. Since the Wisconsin Fair Employment Act (WFEA) is to be liberally construed to effectuate its purposes, namely, to prevent unfair employment discrimination and to prevent individuals from being deprived of the earnings which are necessary to maintain a just and decent standard of living, sec. 111.31, Wis. Stats., it seems to follow that the totality of the circumstances also should be used in determining whether there has been a knowing and voluntary waiver of rights under the WFEA.

In the present case involving Mr. Grahl, the language of the release was clear. The release made clear that the employe did not have to elect either option, but that if the employe elected one of the options, the employe was releasing any and all claims arising out of the employe's employment against Mercury Marine, "including, but not limited to, any alleged violation of state or federal measures which prohibit employment discrimination." (Exh. 1)  Grahl also had a reasonable amount of time to consider whether to sign the release. He received the release on August 2, 1989 and he was not required to make an election until August 25, 1989, a period of 23 days. (TR 28-32, 36; Exh. 1) The consideration given in exchange for the agreement exceeded the amount of pension benefits which Grahl otherwise was entitled to receive. Absent the release, Grahl would have received a normal severance payment of $8,132.92 and a normal pension benefit of approximately $819.76.

(TR 28-32, 36; Exh. 1) After signing the release, Grahl received no severance payment but he received an enhanced pension of approximately $1,041.48. (TR 28-32, 36; Exh. 1)  In terms of Grahl's education and experience, although he only had a high school education, he was self-employed for years as a farmer and he had negotiated labor agreements as a school board member. (TR 70, 74, 77, 120-121) He also had worked for Mercury Marine for nearly 23 years and was employed in a salaried, supervisory position at the time his employment was terminated. (TR 27-28, 71, 77)  In other words, it is clear that Grahl was a management employe who had many years of business experience and who had signed or had been a party to numerous contracts. See Lancaster v. Buerkle Buick Honda Co., 42 FEP Cases at 1473.

Despite these circumstances, Grahl contends that his release was not knowing and voluntary because he was not allowed to negotiate the terms of the release, because he was not encouraged to consult with an attorney, and because he testified that he did not understand that he was waiving his rights to pursue an employment discrimination claim (i.e., It "did not register" with him) (TR 110-118). Grahl argues that under the totality of the circumstances test, an employe's waiver cannot be knowing and voluntary unless the employe has had an opportunity to negotiate the terms of the release and unless he has been encouraged by the employer to consult with an attorney. The Commission disagrees.  In the Commission's opinion, these are only factors to consider in determining whether a release was knowing and voluntary. They are not mandatory requirements. (6) With respect to the negotiation issue, the court in Bormann, 49 FEP Cases at 1625 n. 1, correctly observed:

"Although appellants apparently did not have an opportunity to negotiate the terms of the waiver, which is one of the issues relevant to whether the release was signed knowingly and wilfully, we do not believe that this fact alone requires a trial on 'voluntariness.' A company's willingness to negotiate the terms of a waiver is, in part, additional evidence for the court that the employes- realized that they were giving up potentially valuable legal rights in exchange for consideration. In this case, other indicia, like the clarity of the waiver, make unmistakably clear that appellants were aware that they were giving up 'important rights'. Our conclusion does not mean that this factor is irrelevant in considering the voluntariness of a waiver nor that, on other facts, we would not deny a company's motion for summary judgment due to its alleged unwillingness to negotiate the terms of a waiver."

In this case the very fact that Grahl attempted to vigorously negotiate certain terms of the release suggests that he understood its import. Cf. Cirillo, 48 FEP Cases at 683 n. 4. The Commission finds it difficult to believe that he was able to understand the somewhat complicated mathematical calculations relative to the pension and severance calculations and make an attempt to negotiate those issues, yet not understand the simple, straightforward language of the discrimination release. It is not logical. The Commission believes, for the reasons suggested by the court in Bormann, that the fact that Mercury Marine was not willing to negotiate does not compel the conclusion that Grahl's signing of the release was not knowing and voluntary.

The same is true with respect to consultation with an attorney. If an employe does consult with an attorney, there is a presumption that the execution of the release is knowing and voluntary. Riley, 50 FEP Cases at 672. On the other hand, the mere failure of the employer to affirmatively encourage an employe to consult with an attorney prior to executing the release does not, in the Commission's view, compel the conclusion that the signing of the release was not knowing and voluntary. In this case, Grahl had sufficient opportunity to consult with an attorney prior to signing the release. He has consulted with attorneys in the past, both in his capacity as a school board member and in his personal capacity when he consulted an attorney about a will. Moreover, he even recalled, during his testimony, the name of the labor lawyer used by the school board when he was a member. (TR 74-75) Although employers subject to the ADEA are required to encourage employes to consult with a lawyer prior to signing a release, and although some might feel it desirable for the WFEA to be amended to impose a similar requirement, the Commission does not conclude that Grahl's release was not knowing and voluntary simply because Mercury Marine failed to provide such encouragement.

Finally, Grahl argues that the commission cannot ignore his uncontradicted testimony that it "did not register" with him that he would be waiving his right to pursue employment discrimination claims if he signed the release. From this, Grahl argues that his release could not have been "knowing." He argues that "constructive notice" is irrelevant (it matters only whether he actually knew that he was waiving his rights; it does not matter whether he should have known that he was waiving his rights). Although the Commission agrees with Grahl that it is critical that he knew that he was waiving his rights, the Commission is not required to accept his self-serving testimony on the point (whether or not it is contradicted). See Winfield, 20 FEP Cases at 1111, where the court stated that ". . . plaintiffs' witnesses' own, possibly self-serving statements as to their degree of understanding at the time they signed the release cannot be deemed conclusive." Grahl's testimony on this issue, in the Commission's view, is evasive, self-serving, and unconvincing. Grahl came across as an individual who would go to whatever length necessary to inform himself of what was happening to him. He appeared to be a very deliberate individual, an individual attentive to details. The Commission simply does not accept the idea that he was so preoccupied with the calculation of his pension benefit that he was oblivious to the rest of the release. The Commission believes that his attempt to back away from his decision to choose one of the options presented to him by stating that the release language and its ramifications "did not register" with him is merely an attempt to avoid the consequences of the plain language with which he was presented in the waiver. (TR 110-118) Considering the fact that he admits he read the agreement, considering his business and lay person's legal experience, and considering his apparent attention to his personal financial details, the Commission cannot believe that he did not know that he was releasing his right to pursue discrimination claims in consideration for receiving the enhanced pension benefit.

150

[ Search ER Decisions ] - [ ER Decision Digest ] - [ ER Legal Resources ] - [ LIRC Home Page ]

uploaded 2001/03/23

Footnotes:

(1)( Back ) Frydryk responded in a letter dated August 29, 1989, explaining the calculation of Grahl's pension benefit and indicating that "Due to governmental regulations, the company must apply the pension formula consistently regardless of individual employe situations." (TR 35; Exh. 3)

(2)( Back ) In addition to his argument on the principal issue, Grahl argues that the release is not valid because it was not executed in the context of a disputed factual claim. In other words, he suggests that when he signed the release, there was no claim pending, and that it is improper to compel him to release future claims because he did not know at the time he signed the release whether discriminatory motives may have prompted his termination, and therefore, he could not know what he was releasing. On the other hand, Mercury Marine argues that while employes cannot waive their right to sue before the discrimination occurs, employes can validly release any claims "causally rooted . . . in discriminatory acts or practices which antedate the execution of the release . . ." United States v. Allegheny-Ludlum Industries. Inc., 11 FEP Cases 167 (5th Cir. 1975); Rozers v. General Electric Co., 39 FEP Cases 1581 (5th Cir. 1986). The law clearly supports Mercury Marine's position and the Commission rejects Grahl's argument.

(3)( Back ) In addition to deciding that the Complainants were required to tender back the benefits they had received, in order to contest the validity of the release, Nance went on to decide that the Complainants did not make a voluntary and knowing waiver.  Nance noted (1) that the language of the release was ambiguous and did not make clear that the Complainants were waiving their right to pursue discrimination claims by signing the release;  (2) that the Complainants had something less than 48 hours to decide whether to sign the release, which gave them no practical opportunity to consult an attorney; and  (3) that the employer affirmatively misled the Complainants by insisting that the early retirement option and benefits were extended in consideration for their long years of service, rather than in consideration for their waiver of any future discrimination claims. Nance also concluded that there can be no "constructive knowledge" of a waiver of rights.   ("No matter that the circumstances may support a conclusion that a reasonable person would or should have understood that they were waiving their rights, the question nevertheless is whether these particular Complainants in fact knew that they were giving up their rights.")  Nance relied on an earlier Commission decision, Krawczyk v. Greenfield School District, ERD Case No. 7625011 (LIRC, April 15, 1982), for the proposition that there can be no "constructive knowledge" of a waiver of rights.  But while Krawczyk states that there must be a full explanation of the terms of the waiver and a knowing waiver, it does not state that there cannot be constructive knowledge.  Nance believed the Complainants' testimony that they did not understand or appreciate that they were waiving their rights to file a discrimination claim.  On review, the Commission adopted Nance's decision but specifically addressed only the issues of whether his decision was appealable and whether a tender back was required. The Commission did not address the issue of constructive knowledge.

(4)( Back ) Grahl cites Giese for the proposition that there can be no constructive knowledge of a waiver of rights and that actual knowledge must exist for there to be a "knowing" waiver (Grahl's brief at pp. 12-13; Grahl's reply brief at pp. 1-3). It is curious, however, that Grahl also cites Shannon for the same proposition even though, as noted earlier, Shannon cites Attoe for the opposite result. The difficulty may be in the use of the term "constructive knowledge" in the context of a waiver. In the Commission's opinion, the real issue is whether, looking at all the circumstances, one can infer that the person who signed the release knew that he or she was waiving the rights in question, even if the person claims otherwise. The Commission agrees that the issue should not be whether a reasonable person would have known that the rights were being waived. Rather, the issue is whether the person waiving the rights knew of the waiver.

(5)( Back ) See Bormann, 49 FEP Cases at 1625, which is in accord with the factors set forth in EEOC v. American Express Publishing Corp., but in which the court suggested as yet an additional factor, namely, "whether the employe had a fair opportunity" to consult with an attorney. In most cases, this may be a subset of the factor concerning whether the employe had enough time to consider the release.

(6)( Back ) It is true that under the ADEA, as amended by Pub. L. 101-433, a waiver cannot be knowing and voluntary unless the employe is advised in writing to consult with an attorney prior to executing the agreement. That, of course, is a specific statutory requirement. The Commission does not believe that the WFEA should be construed as imposing such a requirement in the absence of specific statutory language or an administrative rule interpreting the statute. Rather, it should be only one factor to be considered in deciding whether a waiver was knowing and voluntary.