As many of our readers know, the employment realm is comprised of various state and federal laws, each with their own time limitations (or “statute of limitations”) within which a plaintiff must bring a claim. For many types of claims, however, the statute of limitations is not absolute: it can be shortened by a signed agreement from the employee, in an employment contract, an arbitration agreement, or even an employment application.
In a number of cases, employers have included in their employment applications language requiring employees to bring all claims arising out of the employment relationship within a certain time period—in some cases, as short as six months. Courts have repeatedly enforced these agreements. Thus, for example, while the statute of limitations for race and sex discrimination claims in Ohio is six years, employees who agree to bring such claims within six months may be barred from bringing certain discrimination lawsuits at a later time.
Notably, these contractual statute of limitations agreements are not enforceable as to all types of claims or in all jurisdictions. For example, courts generally have declined to enforce agreements to shorten limitations periods for claims under the Family and Medical Leave Act, the Fair Labor Standards Act, and the Equal Pay Act. Courts have also refused to shorten the 300-day period for filing EEOC charges. And outside of Ohio and the Sixth Circuit, some courts (such as the New Jersey Supreme Court) have refused on public policy grounds to enforce these agreements even as to discrimination claims.
Nevertheless, at least in Ohio, well-drafted agreements can provide employers with an important layer of added protection against many types of employment claims. To increase the likelihood of enforcement, these agreements should be written clearly and as simply as possible. They should also be placed in the applicable document in a conspicuous location. Finally, employers who operate in multiple jurisdictions should consider the extent to which the applicable courts would likely enforce the agreement.