The Mutual Termination of Employment Agreement is utilized when both employer and employee in Switzerland agree to end their employment relationship by mutual consent, outside of standard unilateral termination procedures. This document is particularly relevant when parties wish to negotiate specific terms of separation that may differ from standard notice period arrangements under Swiss law. It typically includes provisions for financial settlements, benefit continuations, confidentiality obligations, and release of claims. The agreement must comply with Swiss employment law, particularly the Swiss Code of Obligations, and can be customized to address specific circumstances such as senior executive departures, intellectual property matters, or complex compensation arrangements. This type of agreement offers both parties greater flexibility than a standard termination while providing legal certainty and protection for all involved.
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1. Parties: Identification of the employer and employee with full legal names and addresses
2. Background: Brief description of the employment relationship, including start date and current position, and mutual decision to terminate
3. Definitions: Definitions of key terms used throughout the agreement
4. Termination Date: Specific date when the employment relationship will end
5. Final Salary and Benefits: Details of final salary payment, pro-rated bonuses, and treatment of benefits
6. Holiday Entitlement: Settlement of any accrued but unused vacation days
7. Company Property: Requirements and timeline for returning company property
8. Final Settlement: Comprehensive breakdown of all final payments and settlements
9. Release of Claims: Mutual release of claims between parties
10. Confidentiality: Ongoing obligations regarding confidential information
11. Reference and Communications: Agreement on employment references and internal/external communications regarding the departure
12. Governing Law and Jurisdiction: Confirmation of Swiss law application and jurisdiction
13. Entire Agreement: Standard clause confirming this agreement supersedes previous agreements regarding termination
1. Garden Leave: Used when employee is to remain employed but not work during notice period
2. Non-Competition: Include when enforcing post-employment competition restrictions (must comply with Swiss CO Art. 340)
3. Equity/Share Options: Required when employee has equity or share options that need to be addressed
4. Pension Arrangements: Detailed pension provisions for senior employees or complex pension situations
5. International Tax Provisions: Include for cross-border employment situations
6. Intellectual Property: Necessary for roles involving significant IP creation or ownership
7. Outplacement Support: When outplacement services are being offered as part of the package
8. Board Resignations: Required when employee holds director or board positions
9. Ongoing Cooperation: Used when employee's assistance may be needed for transition or future matters
1. Schedule 1 - Calculation of Final Payment: Detailed breakdown of all payment components including salary, bonus, benefits, and deductions
2. Schedule 2 - Company Property List: Itemized list of company property to be returned
3. Schedule 3 - Benefits Summary: Detailed summary of treatment of various benefits and insurance coverages
4. Appendix A - Form of Release: Standard form for final release of claims
5. Appendix B - Reference Letter: Agreed form of employment reference letter
6. Appendix C - Communication Plan: Template for internal and external announcements regarding the departure
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