What is included in a settlement agreement?
A comprehensive overview of the terms that must be carefully documented and verified upon termination of employment.
The content determines the consequences
In a settlement agreement, the employer and employee set out all the terms regarding the end of the employment relationship. The document's title or length matters little; what counts is the precise wording and what has—or has not—been arranged.
Not every element is legally required in every situation. Nevertheless, missing provisions can lead to issues with future unemployment benefits, financial loss, or unexpected restrictions.
Check first
Only sign once the content accurately reflects the actual situation and the agreements reached.
1. Parties and employment
The agreement must clearly state who is entering into the arrangement and which employment contract it concerns.
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Name and address of employer and employee
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Job title and start date of employment
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Type of employment contract
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Date the agreement is concluded
2. Initiative and reason for dismissal
For a potential unemployment benefit (WW benefit), it is important that the agreement shows the employer proposed the dismissal and that there is no urgent cause or culpable conduct on the part of the employee.
3. End date and notice period
Specify the exact final day of employment. Take into account the applicable statutory or contractual notice period; otherwise, unemployment benefits may commence at a later date.
4. Cooling-off period
State that the employee can normally rescind the agreement in writing within fourteen days. Without such a written statement, the period may extend to 21 days.
5. Severance pay
Specify the gross amount, the calculation method, and the payment date. Assess whether the severance amount is appropriate, taking into account factors such as length of service, the reason for dismissal, and bargaining position.
6. Final settlement
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Salary up to the end date
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Holiday allowance and outstanding holiday entitlement
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Bonus, commission, or thirteenth-month pay
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Expense claims and other entitlements
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Payment date and accurate payslips
7. Work until the end date
Specify whether the employee will continue working or be released from duties while retaining their salary and other employment conditions. Also make arrangements regarding the handover of tasks and availability.
8. Items and documents
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Returning or taking over laptop and phone
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Lease car and other company property
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Access to files and personal data
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Certificate of employment and references
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Pension and insurance information
9. Non-competition and non-solicitation clauses
Clarify whether existing restrictive covenants lapse, are limited, or remain in effect. Ambiguity can hinder the move to a new employer.
10. Confidentiality and full and final discharge
Check what must remain confidential and what communication is permitted. A full and final discharge usually involves the parties waiving further claims; do not sign this until all financial and legal matters are known and settled.
Check before signing
Check not only for the presence of all sections but also for their accuracy and coherence.
Facts are correct
Parties, job title, reason for termination, amounts, and dates align with reality.
Consequences are clear
Unemployment benefits, tax, pension, clauses, and the full and final discharge have been reviewed.
Agreements are complete
Verbal promises and negotiated amendments are included in the final text.
View a complete example
Use the example to see how the components on this page fit together.
Settlement agreement template
Do you want to see how the discussed components come together in a single document? This editable template helps you recognize the structure and wording. Always adapt the template to the specific agreements and circumstances.
Is your settlement agreement complete?
Have all agreements, missing components, and consequences checked before signing.
Frequently asked questions
In any case, the parties, the employment relationship, the termination, the end date, and the agreed terms must be clearly stated. For unemployment benefits and financial implications, the precise reason for dismissal, the initiating party, the notice period, and the final settlement are also important.
In the case of Dismissal by mutual consent, the severance payment is agreed upon. The amount is part of the negotiations and is not automatically fixed.
The employer must inform the employee in writing about the cooling-off period. Without this notification, the period may be extended from fourteen to 21 days.
The parties agree that, once the agreement has been executed, they will have no further claims against each other. Therefore, check first to ensure that absolutely everything has been settled.
Only if both parties agree to it. Therefore, ensure that any necessary additions are included in the final agreement before signing.
Reviews
Professional advice
Your dismissal specialists helped me very well with professional advice following a labor dispute I had with my employer. They clearly have experience with settlement agreements. I definitely needed their assistance to reach a good agreement with my employer. Thank you for the clear communication and all the help!
My thanks
My thanks to Mr. Geradts,
With great professionalism, decisiveness, speed, and effectiveness, I was able to conclude a good settlement agreement. If your first counteroffer hadn’t been so strong, I wouldn’t have been able to secure even half of it.
Not only because of the money, but certainly also to be able to close my employment history with dignity.
I wish every employee in such a situation could have such a skilled lawyer!
Good severance payment
I want to sincerely thank you for the excellent help I received when my employer wanted to terminate my employment contract with a settlement agreement.
You advised me not to sign the agreement and, through negotiations, secured my unemployment benefits and severance payment.
Good advice
We are an employer in a cyclical industry. Sometimes there is plenty of work, other times too little.
Therefore, we regularly have to part ways with employees for “economic reasons.”
We use the services of vaststellingsovereenkomst.org for this. They know exactly how a dismissal request to the CWI or the subdistrict court should be prepared.
Even in cases where an employee underperforms or behaves inappropriately, we have had good experiences with the lawyers at vaststellingsovereenkomst.org.
They are always available to us with sound advice and have never disappointed us.
Difficult situation
A dismissal specialist helped me in a very difficult situation. I had been so foolish to sign a letter in an emotional state, resigning myself. Because of this, I lost my salary and wasn’t entitled to unemployment benefits. Vaststellingsovereenkomst.org managed to reverse this. They were able to prove that I signed under pressure and didn’t fully understand what I was doing.
In the end, I left with a good severance payment and now I have another job. Without the help of Vaststellingsovereenkomst.org, I would be in serious financial trouble right now.
Higher severance payment
I would like to sincerely thank you for the quick and professional assistance.
My employer unexpectedly presented a settlement agreement to terminate my employment contract, but thanks to your help, I received a higher severance payment and compensation for my vacation days.
Excellent assistance provided
Recently, you helped me with my dismissal case. I am very satisfied with the assistance provided. The lawyer was very involved and well-versed in dismissal law. He understood well that I didn’t want a long procedure but wanted the matter resolved quickly.
That solution came swiftly and to my full satisfaction. I didn’t even have to visit your office. Communication was handled by phone and email, so you were always accessible.
My rating: a solid 10.
Dismissed but still well helped
Because of a conflict at work that got seriously out of hand, I was dismissed immediately (summary dismissal). I had behaved badly during that conflict, so I could understand why my boss took such a harsh measure.
But I still had to fight the dismissal, because I had no job and no right to unemployment benefits. Fortunately, the dismissal specialist dared to take the risk and started a procedure against my employer on a No Cure No Pay basis. Without the possibility of No Cure No Pay, I wouldn’t have dared to do it myself.
In the end, after two procedures, the lawyer from vaststellingsovereenkomst.org succeeded in securing my right to unemployment benefits and even a severance payment.
Dismissal assistance
I worked with great pleasure from the age of 18 at a flower exporter in Aalsmeer.
When I was 54, my employer applied for dismissal through the CWI for economic reasons. At that time, I engaged Mr. Edwin van Jaarsveld from Ontslagspecialist for dismissal assistance.
A dismissal permit could not be avoided because my employer was really in financial trouble. Since my employer offered only a very small severance payment, Mr. van Jaarsveld advised me to start proceedings at the subdistrict court.
That turned out to be successful. The court awarded a severance payment of €94,000.
Thanks to the dedication and excellent legal knowledge of vaststellingsovereenkomst.org, I achieved this great result. Kudos!
Very pleasant experience
We are an international company based in Amsterdam. We have engaged Vaststellingsovereenkomst.org as our regular legal counsel and legal assistance for business matters. They successfully concluded our first legal case immediately.
I have found the collaboration with the lawyers at Vaststellingsovereenkomst.org to be very pleasant. We complement each other well regarding key issues and evidence.
Rarely have I experienced such excellent legal service and attention. I would definitely recommend Vaststellingsovereenkomst.org in every respect; their rates are also very reasonable!
