Template Severance Agreement
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Free Severance Agreement Template

A Settlement Agreement t, also known as a Severance Package, is an agreement between an employee and their employer that documents the terms of the employee’s departure. This includes any payments to be made to the employee in exchange for a waiver of claims against the employer.

In general, a severance payment typically includes payment in lieu of notice, accrued holidays, pension payments, and additional bonuses or discretionary amounts as appropriate.

Is a Settlement Agreement legally binding?

A Settlement Agreement is a legally binding document where both parties agree to the terms of an employee’s departure. By signing a Settlement Agreement, the employee is waiving any future claims against the employer in exchange for monetary compensation.

Settlement Agreement vs Compromise Agreement: What’s the difference?

In practice, there is little difference between a Compromise Agreement and a Settlement Agreement. However, under the terms of the new Settlement Agreements, discussions about the offer of such an Agreement cannot be used in a standard unfair dismissal claim unless the employer has engaged in improper behavior.

What’s included in a Severance Agreement?

In general, a Severance Agreement should outline details of any payments to be made to the employee including any accrued holidays, pension payments, and additional bonuses or discretionary amounts as appropriate.

A Severance Agreement should include:

  • Detailed outline of the severance pay
  • The termination date of employment
  • A release of liability

It is common for the employer to include additional information such as a non solicitation clause or a confidentiality agreement.

How do I write a Severance Agreement?

A Severance Agreement is a complicated legal document. Since it is designed to protect an employer of any future claims, it is a very important agreement. Fortunately there are plenty of Severance Agreement templates available online to get you started such as the one provided by Easy Legal Docs.

To complete this template agreement you will need to enter the following information:

  • The employer and employee name
  • Agreement date
  • Employee’s contract termination date
  • The agreed severance payment

Download our free Severance Agreement template for Word, Google Docs & PDF or create it online using our free document generator.