Employment Separation Agreements
If you own a company, you are likely already very familiar with how difficult it can be to terminate an employee. However, it is a task you must deal with if your business has employees other than just the business owners. It’s important that if you plan to let someone go, you are doing it in a manner that will protect both you and your business. It also needs to be a legal termination so that there is no risk of someone filing a wrongful termination lawsuit against you.
While Florida law doesn’t require you to have one, creating an employment separation agreement can be an important tool when it becomes necessary to terminate an employee. To help protect your legal interests, the employment separation agreement should have a clause that asks the individual to release your company from any binding claims. However, before you draw up a random agreement and include that verbiage, it’s important to speak with a West Palm Beach employment and labor law attorney who can prepare a separation agreement that is personally tailored to your business and the employee.
Topics Typically Included in an Employment Separation Agreement
An employment separation agreement will state that this agreement replaces the terms and conditions listed in any prior agreements, including an original employment agreement if applicable.
It’s important to list specifics related to the separation agreement, including the name of the employee and your company as well as the employee’s hire and termination dates. You can choose to list a reason for the termination or keep it vague by saying that you and the employee are separating.
Will there be a severance package? There is not necessarily a legal obligation to do so in most cases, unless the original employment agreement states a specific severance package in the event of termination or separation. Severance packages can include benefits and/or cash. Both federal and state law only require that you pay the employee’s wages and other benefits that were earned prior to termination.
Make sure the agreement includes a date that the final compensation will be provided by. If the severance package is to be made in multiple payments or are benefits that will be paid out over time, make sure the structure and timeframe is adequately spelled out in the agreement. If part of the package includes health insurance coverage under the company for a certain amount of time after termination, be sure that is clearly stated.
If there is a need for a non-compete clause, it’s even more important that you speak with an attorney who can assist with drafting the separation agreement. Non-compete clauses are not easy to enforce in Florida, so it’s important to have an experienced attorney draw up the language.
There are similar issues with non-disclosure or confidentiality agreements. If you don’t draft these clauses correctly, a judge can throw a portion, or the entire agreement, out if there is a court action to enforce the agreement’s terms.
Retaining a Florida Employment and Labor Law Attorney
Before you terminate an employee, it’s important to ensure you thoroughly document all problems and make sure the employee has received both verbal and written warnings. If you have questions about terminating an employee or separation agreements, contact the skilled Florida attorneys at Pincus & Currier LLP at 561-868-1340 to schedule a consultation.