Sounds really oppressive and stressful.

They are asking you to give up all of your employment rights.

Sounds like the kind of place that would mistreat you and then say "Well, at least you have a job."

Just my take. Others on DU make have a different opinion.

who would release information about why an employee was "terminated". That doesn't sound right at all.

HIPPA laws?
Just a thought.

saying what they might do. I bet they won't talk to neighbors, etc., but they could depending on the job and perhaps their liability insurer's policies.

As to if you are terminated or not hired-- I doubt they tell anyone calling for a reference much about an employee's departure. The language sounds like they are trying to cover their rears just in case a supervisor says too much, or a former employee says the employer said too much.

While I haven't read the language, and am not an attorney, I think you are reading too much into the application language.

Your current employer -- if they have a lick of sense -- probably won't say more than she is currently on FMLA or just leave. Obviously, that could be an issue with the perspective employer.

Assuming you really want the job and that you will have an interview before background checks are initiated, I'd probably explain the situation in the interview. Not sure it will be viewed positively, but better to lay it on the line than have it come up in a employment check.

Whatever, good luck.