Termination by mutual agreement: five things to do before you sign
A termination agreement is negotiable. Here is what to check before you put your name to it.
Your employer suggests ending the contract “amicably”. It is quick and there is no notice period, but it is not a neutral choice.
1. Do not sign the same day
Nothing obliges you to answer on the spot. Ask for the draft in writing and take a few days.
2. Check the effect on unemployment benefit
Termination by mutual agreement can delay or reduce your entitlement to benefits. Find out before you commit.
3. Compare with what a dismissal would give you
Work out the payment in lieu of notice you would be entitled to: it is your benchmark in the negotiation.
4. Reread the ancillary clauses
Non-compete, confidentiality, return of the company car, bonuses: each clause has a value.
5. Put the whole agreement in writing
Anything promised verbally must appear in the agreement. What is not written down will be hard to prove.
Legal advice before signing rarely takes more than an hour and spares lasting regret.