The Employment Release Agreement (Aufhebungsvertrag) is a crucial document in German employment law, used when both employer and employee agree to terminate their employment relationship by mutual consent. This approach differs from unilateral termination and offers advantages in terms of legal certainty and flexibility in determining the separation terms. The document becomes necessary in various scenarios, including corporate restructuring, amicable separations, or as an alternative to contentious dismissals. It must comply with German labor law requirements, particularly the Civil Code (BGB) and Protection Against Dismissal Act (KSchG), while addressing all financial, practical, and legal aspects of the employment termination. The agreement typically includes provisions for severance payments, final benefits settlement, confidentiality obligations, and reference letters, providing a comprehensive framework for employment termination that protects both parties' interests.
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1. Parties: Identification of the employer and employee with full legal names and addresses
2. Background: Brief context of the employment relationship and mutual decision to terminate
3. Definitions: Key terms used throughout the agreement
4. Termination of Employment: Clear statement of mutual agreement to terminate, specifying the effective date
5. Final Salary and Benefits: Details of final regular salary payment and treatment of outstanding benefits
6. Severance Payment: Amount, calculation basis, and payment terms of any severance payment
7. Company Property: Requirements and timeline for returning company property
8. Confidentiality Obligations: Ongoing confidentiality obligations post-employment
9. Reference Letter: Commitment to provide a reference letter (Arbeitszeugnis) and its basic terms
10. Release of Claims: Mutual release of claims related to the employment relationship
11. Final Settlement: Confirmation that the agreement represents full and final settlement
12. Governing Law: Specification of German law as governing law
13. Severability: Standard clause on the validity of remaining provisions if others are invalid
1. Garden Leave: Used when employee is to be released from duty before termination date
2. Post-Contractual Non-Compete: Include when maintaining or modifying existing non-compete obligations
3. Continued Benefits: When certain benefits will continue post-employment
4. Works Council Agreement: Required when works council exists and has been involved in the termination
5. Company Housing: Include when employee has been provided with company housing
6. Stock Options/Share Plans: Treatment of existing equity compensation plans
7. Outplacement Services: When company provides career transition support
8. Insurance Continuation: Details of any continued insurance coverage
9. References and Communications: Agreed approach to external and internal communications about the departure
1. Schedule 1 - Severance Calculation: Detailed calculation of severance payment including any bonus pro-ration
2. Schedule 2 - Company Property Inventory: List of company property to be returned
3. Schedule 3 - Outstanding Benefits: Detailed list of accrued but unused vacation days and other benefits
4. Schedule 4 - Reference Letter Draft: Agreed form of reference letter
5. Schedule 5 - Handover Plan: Timeline and responsibilities for knowledge transfer and handover
Relevant legal definitions
Agreement
Company
Employee
Effective Date
Employment Contract
Final Settlement Date
Parties
Reference Letter
Release
Severance Payment
Works Council
Confidential Information
Company Property
Garden Leave Period
Outstanding Benefits
Post-Contractual Obligations
Business Day
Arbeitszeugnis
Aufhebungsvertrag
Group Companies
Intellectual Property Rights
Trade Secrets
Variable Compensation
Benefits
Bonus
Claims
Company
Employee
Effective Date
Employment Contract
Final Settlement Date
Parties
Reference Letter
Release
Severance Payment
Works Council
Confidential Information
Company Property
Garden Leave Period
Outstanding Benefits
Post-Contractual Obligations
Business Day
Arbeitszeugnis
Aufhebungsvertrag
Group Companies
Intellectual Property Rights
Trade Secrets
Variable Compensation
Benefits
Bonus
Claims
Clauses
Mutual Termination
Final Settlement
Severance Payment
Confidentiality
Non-Competition
Non-Solicitation
Return of Property
Reference Letter
Release of Claims
Final Payments
Benefits Termination
Vacation Days Settlement
Company Property
Intellectual Property
Data Protection
Continuing Obligations
Works Council Approval
Internal Communication
External Communication
Tax Indemnity
Social Security
Governing Law
Jurisdiction
Assignment
Severability
Entire Agreement
Amendment
Notices
Counterparts
Waiver
Final Settlement
Severance Payment
Confidentiality
Non-Competition
Non-Solicitation
Return of Property
Reference Letter
Release of Claims
Final Payments
Benefits Termination
Vacation Days Settlement
Company Property
Intellectual Property
Data Protection
Continuing Obligations
Works Council Approval
Internal Communication
External Communication
Tax Indemnity
Social Security
Governing Law
Jurisdiction
Assignment
Severability
Entire Agreement
Amendment
Notices
Counterparts
Waiver
Relevant Industries
Technology
Manufacturing
Financial Services
Healthcare
Retail
Professional Services
Education
Construction
Energy
Transportation
Telecommunications
Media and Entertainment
Hospitality
Real Estate
Agriculture
Automotive
Pharmaceutical
Consumer Goods
Mining and Resources
Public Sector
Relevant Teams
Human Resources
Legal
Finance
Operations
Information Technology
Sales
Marketing
Research and Development
Production
Quality Assurance
Customer Service
Administration
Corporate Communications
Procurement
Business Development
Relevant Roles
Chief Executive Officer
Managing Director
Department Head
Senior Manager
Project Manager
Software Developer
Financial Analyst
Sales Representative
Marketing Manager
Human Resources Manager
Operations Manager
Research Scientist
Account Manager
Administrative Assistant
Production Supervisor
Legal Counsel
Medical Professional
Teacher/Professor
Engineer
Technical Specialist
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