Employee Separation Agreement template

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How to write an employment separation agreement between company and employee? Is the employee obliged to sign an employment separation agreement with employer?

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How to write an employment separation agreement between company and employee? Is the employee obliged to sign an employment separation agreement with the employer? 

If the company announces a lay-off, often the employees are offered a separation agreement, to provide conditions for closure and to arrange the ending of the working relationship. If the employee agrees and understands that the benefits provided are reasonable, and the company cannot provide a decent salary and work in the near future, it's best not to fight the separation agreement.

In case of doubt, always consult a local lawyer that is experienced with labor law. Make sure not only to consider legal conditions, but also the existing working relationship. If you choose to sour the relationship with your boss in the end, this might give difficulties later on when you are looking for a new job and you need their reference.

Often, those benefits to which Employee would be entitled to receive upon separation from employment, and often the company is not obligated to pay the employee any additional benefits if the employment agreement allows for one-sided cancellation of the working relationship (including a notice period). The separation agreement benefits often are favorable for the employee, and in return, they ask for compliance with, and non-revocation of any provisions of, this Agreement. 

Employee further acknowledges no entitlement to any additional payment or consideration not specifically referenced in this Agreement.

Such a Separation agreement needs to consist of the following articles:

  • Parties (Employer or Company);
  • Separation date ;
  • Final payment of wages ;
  • Benefits (Stock options, Cobra, etc);
  • Return of Property ;
  • Separation/Severance Benefits ;
  • General Release of Claims ;  
  • General Release and Waiver of Claims;
  • Claims Not Released.;
  • Governmental Agencies ;
  • Collective/Class Action Waiver ;
  • Release of Age Discrimination in Employment Act ADEA) Claims;
  • Unemployment Benefits And References ;
  • Continuing Obligations Under Prior Agreements ;
  • Non-Disparagement ;
  • Employee Representation ;
  • Employee Affirmation ;
  • No Admission of Liability ;
  • Attorney Consultation and Fees ;
  • Time for Signing and Revocation of Agreement ;
  • Agreement Not To Be Construed Against Any Party;
  • Consequences of Breach;
  • Governing Law/Severability;
  • Employee Acknowledgment Statement;
  • Signatures.

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