The Mutual Separation Letter is a critical document used in the UAE when an employer and employee agree to terminate their employment relationship by mutual consent. This document, governed by UAE Labor Law (Federal Decree-Law No. 33 of 2021), provides a formal framework for amicable employment termination while ensuring compliance with local regulations. It is particularly useful in situations where both parties wish to end the employment relationship on agreed terms, different from standard resignation or termination procedures. The letter typically includes essential elements such as the separation date, financial settlements, end-of-service benefits, and continuing obligations, while also addressing specific UAE requirements such as visa cancellation procedures for expatriate employees and necessary clearances from various departments.
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1. Letter Header: Company letterhead, date, and reference number
2. Addressing: Employee's full name, position, and employee ID
3. Subject Line: Clear indication that this is a mutual separation letter
4. Opening Statement: Reference to previous discussions and confirmation of mutual agreement to terminate employment
5. Last Working Day: Clear statement of the agreed final day of employment
6. Financial Settlement: Breakdown of final settlement including salary, end of service gratuity, and other entitlements
7. Company Property: List of company property to be returned and deadline for return
8. Clearance Process: Steps for obtaining necessary clearances before final settlement
9. Non-Disclosure: Reminder of continuing confidentiality obligations
10. Full and Final Settlement: Statement confirming this as full and final settlement of all claims
11. Acknowledgment: Space for both parties to sign acknowledging agreement to terms
1. Garden Leave: Include when employee is to be placed on garden leave during notice period
2. Reference Letter: Include when agreeing to provide employment reference
3. Non-Competition: Include when reinforcing existing non-compete obligations
4. Visa Status: Include for expatriate employees requiring visa cancellation details
5. Medical Insurance: Include when specifying the end date of medical insurance coverage
6. Outstanding Loans: Include when there are company loans to be settled
7. Continuing Obligations: Include when specifying any ongoing obligations post-employment
1. Financial Settlement Breakdown: Detailed calculation of all financial entitlements including salary, gratuity, leave encashment, and other benefits
2. Company Property Checklist: Itemized list of company property to be returned
3. Clearance Checklist: List of departments from which clearance needs to be obtained
4. Employee Benefits Summary: Summary of benefits and their treatment post-separation
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