The New York Legislature recently passed a bill that would impose new procedural requirements on employers seeking releases of claims in employee severance agreements. The bill, known as the No Severance Ultimatums Act, is expected to be delivered to Governor Kathy Hochul before the end of 2026. Given the legislation’s potentially significant impact and immediate effective date if signed, we are providing this advance notice so employers can begin assessing their severance practices and preparing for possible implementation.
The bill would add a new Section 215-d to the New York Labor Law that would extend requirements similar to the federal Older Workers Benefit Protection Act (OWBPA) to all severance agreements requiring employees to waive claims against their employer.
Scope of Covered Agreements
The bill targets what the legislature characterizes as “coercive severance ultimatums” and would apply when an employer offers an employee or former employee an agreement related to the individual’s separation from employment that requires the release of waivable claims.
Unlike the OWBPA, which applies only to waivers of federal age discrimination claims by employees age 40 and older, the New York bill would apply regardless of the employee’s age or the nature of the claims being released. As a result, the legislation would significantly expand the population of those entitled to periods of time to consider and revoke severance agreements.
Proposed Requirements
Under the bill,...
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