The Mutual Severance 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 is often preferred over unilateral termination as it provides legal certainty for both parties and can help avoid potential litigation. The agreement is particularly relevant in scenarios such as corporate restructuring, leadership changes, or amicable separations. It must comply with German labor law requirements, including provisions of the German Civil Code (BGB) and various employment regulations. The document typically includes comprehensive terms covering severance payments, benefit arrangements, confidentiality obligations, and mutual releases, while ensuring compliance with tax laws and social security regulations. It's essential to note that such agreements require careful drafting to ensure enforceability under German law and often involve consultation with works councils where they exist.
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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: Specific date and terms of the employment termination by mutual agreement
5. Severance Payment: Amount, calculation basis, payment date, and tax treatment of the severance payment
6. Final Salary and Benefits: Treatment of outstanding salary, bonus, vacation days, and other benefits
7. Company Property: Requirements and timeline for returning company property
8. Confidentiality Obligations: Ongoing confidentiality obligations post-employment
9. Release of Claims: Mutual release of employment-related claims
10. Reference Letter: Commitment to provide a qualified reference letter (qualifiziertes Arbeitszeugnis)
11. Social Security and Insurance: Implications for social security and continuation of insurance coverage
12. Final Provisions: Severability clause, governing law, and form requirements
1. Garden Leave: Used when employee is to be released from duty until termination date
2. Post-Contractual Non-Compete: Include when parties agree on post-employment competition restrictions with compensation
3. Outplacement Services: When employer provides career transition support
4. Works Council Approval: Required when works council exists and their involvement is necessary
5. Stock Options/Share Treatment: Include when employee has equity-based compensation
6. Pension Arrangements: Used when specific arrangements for company pension schemes are needed
7. References and Recommendations: When parties agree on specific terms for future references beyond the standard reference letter
8. Legal Costs: Include when employer agrees to cover employee's legal consultation costs
1. Severance Calculation: Detailed breakdown of severance payment calculation
2. Company Property Inventory: List of company items to be returned
3. Outstanding Benefits Statement: Detailed list of accrued benefits and their treatment
4. Draft Reference Letter: Agreed form of employment reference letter
5. Benefits Continuation Schedule: Details of any benefits continuing post-termination
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