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Basic Separation Agreement Template for Hong Kong

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Key Requirements PROMPT example:

Basic Separation Agreement

"I need a Basic Separation Agreement under Hong Kong law for a senior marketing manager who will be leaving amicably on March 15, 2025, with a 3-month garden leave period and standard non-compete restrictions."

Document background
The Basic Separation Agreement is a crucial document used in Hong Kong employment contexts when formally ending an employment relationship by mutual agreement. It is typically used when both parties wish to document a clean break and ensure clarity regarding their respective rights and obligations post-employment. The agreement must comply with Hong Kong employment laws, particularly the Employment Ordinance (Cap. 57), and includes essential elements such as termination payments, benefit arrangements, and confidentiality obligations. This document is particularly important in scenarios where the employment termination is amicable and both parties seek to minimize potential future disputes by clearly documenting all separation terms. The agreement can be customized based on the employee's seniority, role, and specific circumstances while maintaining compliance with local employment regulations.
Suggested Sections

1. Parties: Identification of the employer and employee with full legal names and addresses

2. Background: Brief recital of employment history and mutual agreement to terminate

3. Definitions: Definitions of key terms used throughout the agreement

4. Termination Date: Specification of the official end date of employment

5. Final Payment and Benefits: Details of salary, unused leave, and statutory payments due

6. Tax Treatment: Clarification of tax handling for various payment components

7. Company Property: Requirements for return of company property and documents

8. Confidentiality: Ongoing obligations regarding confidential information

9. Full and Final Settlement: Mutual release of claims and waiver of rights

10. Governing Law: Specification of Hong Kong law as governing law

11. Entire Agreement: Confirmation that this document represents the complete agreement between parties

Optional Sections

1. Post-termination Restrictions: Non-compete and non-solicitation clauses, typically included for senior employees or those with access to sensitive information

2. Reference: Terms regarding the provision of employment references, if agreed

3. Continuation of Benefits: Details of any benefits extending beyond termination date, such as medical coverage

4. Legal Fees: Agreement on payment of legal fees for agreement review, if applicable

5. Outplacement Support: Details of any career transition services provided, typically for senior roles

6. Garden Leave: Terms of any garden leave period before final termination, if applicable

7. Share Options/Awards: Treatment of outstanding equity compensation, if employee participated in such schemes

Suggested Schedules

1. Schedule 1 - Payment Calculation: Detailed breakdown of all payments including salary, statutory payments, and other benefits

2. Schedule 2 - Company Property: Itemized list of company property to be returned

3. Schedule 3 - Post-termination Restrictions: Detailed terms of any continuing restrictions on employee activities

4. Appendix A - Acknowledgment Form: Form confirming return of company property and documents

5. Appendix B - Tax Declaration: Employee's declaration regarding tax treatment of payments

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

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