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of Appeal added that the future violations of law that are not allowed to be released are generally unknown future violations of law.

At the time Castelo signed the Separation Agreement and the extension, Xceed had already made the decision to terminate her. Castelo already knew the facts that would later form the basis for her wrongful termination and age discrimination claims. Castelo testified that by the time she signed the releases, she believed she was being wrongfully terminated and the wrongful termination was based on age discrimination. Castelo also did not allege any new, independent acts of discrimination after the date she signed the second release.

The only violations of law that cannot be released by an agreement between two parties are unknown future violations of law. The Court of Appeal sided with Xceed and upheld the judgment of the arbitrator and trial court.

Castelo v. Xceed Financial Credit Union (2023) 91 Cal.App.5th 777.

Note:

The employer was fortunate that the employee did not allege any new discrimination after the date she signed the releases. Severance agreements that release an employer from future, unknown violations of the law are not valid.

Brian Hawkinson, an Associate in the San Francisco office where he provides legal expertise concerning labor and employment matters. Prior to joining LCW, Brian worked for an Oakland based civil rights law firm where he actively participated in all stages of litigation: from screening clients, investigating claims, and filing complaints to engaging in discovery, resolving disputes with opposing counsel, and responding to dispositive motions.

Jordan M. Carman, an associate in the Los Angeles office where she provides labor, employment, and education law expertise to our public and private education clientele. Prior to joining LCW, Jordan worked at The Child Care Law Center in Berkeley, CA where she secured childcare subsidies for low-income clients and provided technical assistance to the Department of Social Services on the drafting of regulations and sub-regulatory guidance affecting families and childcare providers.