An Employment Settlement Agreement is a crucial legal document used in Ireland when an employer and employee agree to terminate their employment relationship on mutually agreed terms. This document is particularly relevant in situations involving redundancy, workplace disputes, senior executive departures, or other circumstances where a negotiated exit is preferred. The agreement must comply with Irish employment law requirements, including the necessity for the employee to receive independent legal advice. It typically includes comprehensive details about financial settlements, benefits, confidentiality provisions, tax arrangements, and waivers of potential claims. The document serves to protect both parties' interests and provides legal certainty by creating a clean break in the employment relationship while preventing future litigation.
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1. Parties: Identifies the employer and employee, including full legal names and addresses
2. Background: Sets out the context of the employment relationship, including start date, role, and circumstances leading to the settlement
3. Definitions: Defines key terms used throughout the agreement
4. Termination Date: Specifies the official end date of employment and any garden leave arrangements
5. Settlement Payments: Details all payments to be made, including ex-gratia payments, salary, benefits, and tax treatment
6. Company Property: Requirements for return of company property and equipment
7. Confidentiality: Obligations regarding confidentiality of the agreement and company information
8. Full and Final Settlement: Waiver of claims and full settlement terms
9. Legal Advice: Confirmation that independent legal advice has been received
10. Post-Termination Restrictions: Reaffirmation of any existing post-employment restrictions
11. Tax Indemnity: Employee's responsibility for tax on settlement payments
12. Entire Agreement: Confirms the agreement represents the complete understanding between parties
13. Governing Law: Specifies Irish law as governing law and jurisdiction
14. Execution: Signature blocks and execution requirements
1. Reference: Terms regarding the provision of employment references - include when agreed as part of settlement
2. Announcement: Internal/external communication about the employee's departure - include when parties agree on specific messaging
3. Share Options: Treatment of existing share options or equity - include if employee has share-based compensation
4. Outplacement Support: Details of any career transition services - include if offered as part of package
5. Medical Insurance: Continuation of medical benefits - include if extending beyond termination
6. Non-Disparagement: Mutual obligations not to make derogatory statements - include if specifically requested
7. Future Cooperation: Employee's agreement to assist with handover or future queries - include if needed
8. Legal Costs: Payment of employee's legal fees - include if employer is contributing
9. Garden Leave: Terms of any garden leave period - include if applicable
10. Variation: Process for varying agreement terms - include for complex settlements
1. Schedule 1 - Claims: Comprehensive list of statutory and contractual claims being settled
2. Schedule 2 - Payment Breakdown: Detailed breakdown of all payments and benefits
3. Schedule 3 - Company Property: Itemized list of company property to be returned
4. Schedule 4 - Post-Termination Restrictions: Full text of continuing restrictive covenants
5. Appendix 1 - Advisor's Certificate: Independent legal advisor's confirmation of advice given
6. Appendix 2 - Resignation Letter: Form of resignation letter to be signed by employee
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