The Mutual Termination of Employment agreement is utilized when both employer and employee in Hong Kong mutually agree to end their employment relationship on negotiated terms. This document is particularly valuable when parties wish to achieve a clean break while ensuring all legal obligations are met and documented. It addresses requirements under Hong Kong's Employment Ordinance and related legislation, covering crucial elements such as final payments, benefits, tax implications, and ongoing obligations. The agreement is commonly used during corporate restructuring, career transitions, or when both parties seek an amicable separation. It provides clarity and certainty by documenting all agreed terms, helping prevent future disputes and ensuring compliance with Hong Kong employment laws. The document is especially important given Hong Kong's sophisticated employment law framework and its status as a major international business hub.
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1. Parties: Identifies the employer and employee, including their full legal names and addresses
2. Background: States the existing employment relationship, original employment date, and mutual desire to terminate
3. Definitions: Defines key terms used throughout the agreement
4. Termination Date: Specifies the agreed-upon termination date and last day of employment
5. Final Payment: Details the calculation and payment of final salary, unused leave, and statutory entitlements
6. Return of Company Property: Lists company property to be returned and deadline for return
7. Confidentiality: Confirms ongoing obligations regarding confidential information
8. Non-Disparagement: Mutual agreement not to make negative statements about each other
9. Release and Waiver: Mutual release of claims related to employment and its termination
10. Tax Implications: Clarifies responsibility for tax payments on termination payments
11. Governing Law: Specifies Hong Kong law as governing law and jurisdiction
12. Entire Agreement: Confirms this agreement supersedes all previous agreements regarding termination
13. Execution: Signature blocks and execution details
1. Post-Termination Restrictions: Confirms or modifies any existing non-compete or non-solicitation obligations
2. Share Options/Awards: Addresses treatment of outstanding share options or equity awards
3. Handover: Details specific handover requirements for ongoing projects or responsibilities
4. Reference: Agreed form or approach to future employment references
5. Medical Benefits: Extension or termination of medical benefits coverage
6. Legal Fees: Agreement on payment of legal fees for reviewing the agreement
7. Outplacement Support: Provision of career transition or outplacement services
8. Continuing Cooperation: Agreement to assist with specific matters post-termination
9. Immigration Status: Addressing work visa implications if applicable
1. Schedule 1 - Payment Calculation: Detailed breakdown of all termination payments and deductions
2. Schedule 2 - Company Property: Comprehensive list of company property to be returned
3. Schedule 3 - Outstanding Benefits: List of benefits and their treatment upon termination
4. Schedule 4 - Handover Checklist: Detailed list of handover tasks and responsibilities
5. Appendix A - Release Form: Detailed form of mutual release and waiver
6. Appendix B - Reference Letter: Agreed form of reference letter if applicable
Authors
Relevant legal definitions
Clauses
Relevant Industries
Financial Services
Technology
Manufacturing
Retail
Professional Services
Healthcare
Education
Construction
Hospitality
Telecommunications
Real Estate
Transportation
Energy
Media and Entertainment
Non-Profit
Relevant Teams
Human Resources
Legal
Compliance
Finance
Operations
Executive Management
Administration
Risk Management
Corporate Governance
Relevant Roles
HR Director
HR Manager
Legal Counsel
Company Secretary
Chief Executive Officer
Chief Financial Officer
Chief Operating Officer
Department Head
Line Manager
Supervisor
HR Business Partner
Compliance Officer
Risk Manager
General Manager
Regional Manager
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