The Termination Agreement serves as a crucial legal document for formally ending employment relationships in the Philippines. It is typically used when both employer and employee agree to terminate the employment relationship, or when termination occurs due to authorized causes under Philippine labor law. The document ensures compliance with the Labor Code of the Philippines and related DOLE regulations, protecting both parties' interests by clearly outlining separation terms, benefits, and mutual obligations. This agreement is essential for properly documenting the termination process, calculating correct separation benefits, and preventing future disputes. It should be customized based on the specific circumstances of the termination, the employee's position, length of service, and applicable industry regulations.
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1. Parties: Identification of the employer and employee, including complete legal names and addresses
2. Background: Brief history of the employment relationship, including start date, position, and reason for termination
3. Definitions: Key terms used throughout the agreement
4. Effective Date of Termination: Specific date when the employment relationship will end
5. Final Settlement: Details of final salary, benefits, and other compensation to be paid
6. Separation Benefits: Calculation and payment terms of separation pay and other statutory benefits
7. Return of Company Property: Requirements for returning company assets, documents, and equipment
8. Confidentiality Obligations: Ongoing obligations regarding confidential information
9. Release and Waiver: Mutual release of claims between parties
10. Final Certificate of Employment: Commitment to provide final employment documentation
11. Governing Law: Specification of Philippine law as governing law
12. Execution: Signature blocks and execution requirements
1. Non-Competition: Restrictions on future employment activities, if applicable and legally enforceable
2. Non-Solicitation: Restrictions on soliciting employees or customers, if applicable
3. Continuing Obligations: Any ongoing obligations that survive termination
4. Reference Provision: Terms regarding future employment references
5. Legal Consultation: Acknowledgment of right to seek independent legal advice
6. Tax Provisions: Specific arrangements regarding tax treatment of payments
7. Dispute Resolution: Alternative dispute resolution procedures
8. Social Media Clause: Guidelines for social media behavior post-termination
1. Schedule A - Calculation of Final Settlement: Detailed breakdown of final payment including salary, benefits, and deductions
2. Schedule B - Company Property Checklist: List of company property to be returned
3. Schedule C - Benefits Summary: Summary of continuing benefits or benefit conversions
4. Schedule D - Clearance Requirements: Checklist of clearance requirements from different departments
5. Appendix 1 - Statutory Benefits Computation: Detailed calculation of statutory benefits as per Philippine labor laws
6. Appendix 2 - Exit Interview Form: Standard exit interview documentation
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