The Mutual Termination of Employment Agreement is used when both employer and employee agree to end their employment relationship amicably under Australian law. This document is particularly relevant when parties wish to formalize the separation terms in a clear, legally binding manner while ensuring compliance with Australian employment legislation, including the Fair Work Act 2009. It addresses crucial elements such as termination date, final payments, leave entitlements, superannuation, confidentiality, and mutual releases. The agreement provides protection for both parties by clearly documenting the terms of separation and preventing future disputes. It's commonly used during restructures, career transitions, or when both parties agree that ending the employment relationship serves their respective interests.
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1. Parties: Identifies and defines the employer and employee who are parties to the agreement
2. Background: Outlines the current employment relationship and mutual decision to terminate
3. Definitions: Defines key terms used throughout the agreement
4. Termination Date: Specifies the official end date of employment
5. Final Payment: Details the breakdown of final payment including salary, leave entitlements, and any special payments
6. Release and Waiver: Mutual release of claims between parties, subject to terms of the agreement
7. Company Property: Requirements for return of company property and documentation
8. Confidentiality: Ongoing obligations regarding confidential information
9. Tax Implications: Statement about tax treatment of payments and responsibilities
10. General Provisions: Standard boilerplate clauses including governing law, entire agreement, and amendments
11. Execution: Signature blocks and execution details
1. Post-Employment Restrictions: Include when there are specific non-compete or non-solicitation requirements to be maintained
2. Reference and Announcements: Include when parties agree to specific terms about employment references or public announcements
3. Ongoing Cooperation: Include when employee's assistance may be needed for transition or future matters
4. Benefits Continuation: Include when certain benefits will continue post-termination
5. Share Options/Awards: Include when employee has share options or awards that need to be addressed
6. Legal Advice: Include when documenting that parties have had opportunity to seek independent legal advice
7. Dispute Resolution: Include when specific dispute resolution procedures are agreed upon
1. Schedule 1 - Final Payment Calculation: Detailed breakdown of all final payment components including leave entitlements
2. Schedule 2 - Company Property Register: List of all company property to be returned
3. Schedule 3 - Continuing Obligations: Reference to specific clauses from employment contract that survive termination
4. Appendix A - Deed of Release: Formal release of claims document if required as separate deed
5. Appendix B - Certificate of Service: Standard employment service record and reference if agreed
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