Free Resources

 On-Line

Self Development Monthly E-Zine

Name

Country / Region

e-mail

  

 

 

Resignation and Severance Pay Agreement

L

et's say that you have employee who you would like to terminate, but perhaps your documentation isn't quite up to snuff or, to put it another way, you don't have all your ducks in order. In order to terminate employment, you are willing to pay severance provided that the individual will not sue the company for past, current, or future grievances.

 

This calls for an agreement between the company and the employee which is as ironclad as any such agreement can be. Winning Associates has written many of these agreements, the wording of which conforms to all states' legal standards. In two instances, our clients did have to go to arbitration, but in both instances the arbitrator found in our clients' favor.

 

Since I am not an attorney, and even though the following agreement was approved by counsel, you may wish to pass this by your attorney as well. There may be sections which do not apply in a particular circumstance. (If you'd care to discuss this with the author, please call as noted at the end of this file.)

 

 

Resignation Agreement

 

This Resignation Agreement ("Agreement") is made this____ day of month, year, between (employee's name) and (company name).

 

 

In consideration of the promises made, severance paid, and the releases contained in the Agreement, Employee and Company agree as follows:

  1. Employee has voluntarily resigned from her employment with the Company, effective (month, day, year = MDY).

  2. The Company will pay to Employee severance pay in an amount equivalent to his/her regular salary from MDY to MDY less normal withholdings, payable on or before MDY. In addition, the Company shall pay any and all vacation accrued but not taken as of MDY.

  3. Employee will receive his/her vested interest in the 19xx Profit Sharing Plan in accordance with the terms and conditions of the Plan. (This is, of course, if your company has a Plan.)

  4. Employee will also be offered the opportunity for continued coverage under the Company's health insurance plans, as required by COBRA. (If you have 20 or more employees, and the employee is not being dismissed for gross misconduct, then he/she will be eligible for COBRA.)

  5. Employee acknowledges that by reason of her position with the Company s/he has access to confidential and proprietary information respecting the Company's financial and business affairs. Employee represents that s/he has held all such information confidential and will continue to do so. Employee also agrees that s/he will return all Company property, files, information in his/her possession, on or before MDY.

Back to Ezine