Mutual Separation Agreement for Germany

Mutual Separation Agreement Template for Germany

This document template provides a comprehensive framework for a Mutual Separation Agreement (Aufhebungsvertrag) under German employment law. It facilitates the consensual termination of an employment relationship between an employer and employee, ensuring compliance with German labor regulations and social security requirements. The agreement covers essential elements including termination date, severance payments, final salary arrangements, holiday entitlements, and post-employment obligations. It incorporates necessary provisions to protect both parties' interests while ensuring the agreement's validity under German law, including specific considerations for works council involvement and social security implications.

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What is a Mutual Separation Agreement?

The Mutual Separation Agreement (Aufhebungsvertrag) is a crucial document in German employment law that enables employers and employees to mutually agree to terminate their employment relationship outside the standard notice period requirements. This document becomes relevant when both parties wish to end the employment relationship amicably, often in scenarios involving restructuring, career changes, or conflict resolution. It must comply with German labor law requirements, including specific provisions of the Civil Code (BGB) and Employment Protection Act (KSchG). The agreement typically includes detailed terms regarding severance payments, final salary settlements, benefit arrangements, and ongoing obligations. Special attention must be paid to social security implications and potential impacts on unemployment benefits under German law. The document serves as a legally binding record of the termination terms while protecting both parties' interests.

What sections should be included in a Mutual Separation Agreement?

1. Parties: Identification of the employer and employee, including full legal names and addresses

2. Background: Brief description of the employment relationship and mutual decision to terminate

3. Definitions: Key terms used throughout the agreement

4. Termination Date: Specific date when employment relationship ends and confirmation of mutual consent

5. Final Salary and Benefits: Details of final regular salary payment and treatment of standard benefits

6. Severance Payment: Amount, calculation basis, and payment terms of the severance package

7. Holiday Entitlement: Settlement of remaining vacation days and any compensation

8. Release of Claims: Mutual waiver of claims related to the employment relationship

9. Confidentiality: Ongoing obligations regarding confidential information

10. Reference Letter: Commitment to provide a qualified reference letter (qualifiziertes Arbeitszeugnis)

11. Final Provisions: Standard closing clauses including applicable law, severability, and written form requirement

What sections are optional to include in a Mutual Separation Agreement?

1. Garden Leave: Terms of release from work duties until termination date, if applicable

2. Company Property: List and return process for company assets, when significant items are involved

3. Post-Contractual Non-Compete: Terms of any continuing competition restrictions, if agreed

4. Ongoing Projects: Handover arrangements for specific projects or responsibilities

5. Training Costs: Treatment of any outstanding training cost repayment obligations

6. Stock Options/Benefits: Treatment of outstanding equity-based compensation or special benefits

7. Outplacement Services: Terms of any career transition support provided

8. Works Council: Reference to works council involvement, if applicable

9. Health Insurance: Special arrangements regarding health insurance continuation

10. References: Specific agreements about the content of references or recommendations

What schedules should be included in a Mutual Separation Agreement?

1. Calculation of Severance Payment: Detailed breakdown of severance calculation including factors and adjustments

2. Company Property List: Itemized list of company property to be returned

3. Outstanding Benefits Statement: Detailed list of all outstanding benefits and their treatment

4. Project Handover Plan: Detailed timeline and responsibilities for project transitions

5. Benefits Continuation Schedule: Timeline and details of any benefits continuing post-employment

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

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Enforceable Agreement

A legally binding agreement governed by German law, compliant with BGB requirements and commercial legislation.

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What is a Mutual Separation Agreement?

What sections should be included in a Mutual Separation Agreement?

What sections are optional to include in a Mutual Separation Agreement?

What schedules should be included in a Mutual Separation Agreement?

Authors

Alex Denne

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