A Work Settlement Agreement is commonly used in England and Wales when employment is terminated by mutual agreement or in potentially disputatious circumstances. It provides a clean break between employer and employee, typically including financial compensation, confidentiality terms, and waiver of claims. The agreement must meet specific statutory requirements, including independent legal advice for the employee. It's particularly useful in situations involving redundancy, performance issues, or workplace disputes, offering protection to both parties while ensuring compliance with UK employment law. The document typically includes detailed payment terms, tax treatment, post-employment restrictions, and reference provisions.
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1. Parties: Identification of employer and employee
2. Background: Context of employment and circumstances leading to settlement
3. Definitions: Key terms used throughout the agreement
4. Termination Date: Specified date of employment termination
5. Settlement Payments: Details of all payments to be made including timing and tax treatment
6. Waiver of Claims: Comprehensive list of claims being settled and waived by the employee
7. Confidentiality: Obligations regarding confidentiality of agreement and employment information
8. Legal Advice: Confirmation of independent legal advice received and adviser details
9. General: Standard boilerplate provisions including governing law and jurisdiction
1. Garden Leave: Terms of garden leave period before final termination date
2. Post-termination Restrictions: Non-compete and other restrictive covenants continuing after termination
3. Reference: Terms of agreed employment reference to be provided
4. Company Property: Requirements and timeline for return of company property
5. Outplacement Support: Details of any career transition or outplacement services to be provided
1. Schedule 1: Claims Being Settled: Detailed list of statutory and contractual claims being waived under the agreement
2. Schedule 2: Payment Details: Detailed breakdown of all settlement payments, including tax treatment
3. Schedule 3: Adviser's Certificate: Certificate to be signed by independent legal adviser confirming advice given
4. Appendix 1: Agreed Reference: Template of agreed employment reference to be provided to future employers
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