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What can be included in a separation agreement?

On Behalf of Hantzes & Associates | Nov 13, 2020 | Business Law |

When an employer in the Fairfax area terminates an employee’s job, whether it is because of employee misconduct or as part of company lay-offs, the employer may want the employee to sign a separation agreement. The goal of a separation agreement is for both parties to agree they have amicably ended the employer-employee relationship.

How do employers benefit from separation agreements?

Employers benefit from separation agreements, as they can stop employees from appropriating confidential company information. Separation agreements can also protect employers from being sued for by the employee. The following are some common conditions included in separation agreements

Details on the termination

Separation agreements may include the details of which the employment is ending, including the parties to the agreement, the date the employee’s employment was terminated and the reason for the termination.

Severance packages

Some, but not every, separation agreement will include a severance package, aside from receiving pay for the final day of work and accrued vacation. However, a severance package may be included in an employee handbook. Severance packages could take the form of a structured pay-out plan or they may simply be a single lump sum given to the employee.

Non-compete agreements

In addition, some separation agreements will include non-compete provisions. These types of provisions keep an employment from obtaining a job in the same field as the employer for a certain amount of time, withing a specific geographic region, or both. Ultimately, non-compete agreement protect employers from having workers leave and work for competitors of the employer.

Non-disclosure agreements

Non-disclosure agreements also protect employers by making sure the details of the workplace are kept confidential. This may include trade secrets, financial information and customer lists, among other information.

Separation agreements are legal documents

Ultimately, separation agreements are subject to employment laws as well as contract law. For this reason, employers in Fairfax wishing to execute a separation agreement may want to seek legal advice, which this post does not contain. Employment law attorneys in the Washington, D.C. metro area can explain more about separation agreements to interested employers.

 

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