Settlement agreement: employment (long form)

by Practical Law Employment , with thanks to Chris Goodwill , Clifford Chance LLP for clauses relating to the financial services sector

A Standard Document providing a detailed, long-form settlement agreement suitable for senior executive terminations and other complex employment separations in England and Wales. This Standard Document is designed to facilitate a full and final settlement, providing a framework for waiving statutory and contractual claims arising from the employment relationship or its termination. It addresses the critical financial components of a settlement, including the termination payment, any payment in lieu of notice (PILON), and the tax treatment of these sums under the Income Tax (Earnings and Pensions) Act 2003 (ITEPA), including Post-Employment Notice Pay (PENP). The agreement includes a wide range of optional clauses to tailor the document to specific circumstances, such as garden leave, restrictive covenants, directors' and officers' insurance, and the continuation of benefits. It also contains extensive confidentiality and non-derogatory provisions with necessary carve-outs for legal and regulatory compliance, such as protected disclosures and reporting to authorities like the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA). It also provides template schedules for a list of waived claims, an adviser's certificate, and an agreed reference. For a shorter agreement suitable for less complex terminations see Standard document, Settlement agreement: employment (short form). For a settlement agreement where the employment contract is not terminating, see Standard document, Settlement agreement (no termination). For a settlement agreement for use in civil litigation in non-employment matters, see Standard document, Settlement agreement and release: civil litigation. For an equivalent settlement agreement suitable for use in Scotland, see Standard document, Settlement agreement: employment (long form) (Scotland).