SEPARATION AGREEMENT AND GENERAL RELEASE

(State-specific base: CA)

[// GUIDANCE: Use employer letterhead if desired. Confirm compliance with state wage payment, PTO payout, and any required language before issuing.]

1. Parties and Key Dates

• Employer: [Company legal name and entity type]; address: [address].
• Employee: [Employee legal name]; address: [address].
• Separation date: [date].
• Final pay timing (CA-specific):
• If terminated/laid off: IMMEDIATE payment at time of termination
• If employee quits with 72+ hours notice: Payment on last day of work
• If employee quits with <72 hours notice: Payment within 72 hours of notice
• Must include: All earned wages, commissions, and ALL accrued/unused PTO (earned wage under CA law)
• Waiting time penalty: Failure to timely pay = average daily wage for up to 30 days

2. Consideration and Benefits

• Severance: [amount] payable [lump sum/installments] less required withholdings; conditioned on timely execution and non-revocation.
• COBRA/benefits: [duration and amount of employer contribution]; subject to plan terms.
• Outplacement or transition support: [if any].

3. Equity, Bonus, and Other Compensation

• Equity awards: state treatment of vested/unvested equity, exercise deadlines, and post-termination service rules.
• Bonus/commissions: specify earned/unearned status, proration, and payment timing.
• Expense reimbursement: confirm all business expenses have been submitted; commit to pay in compliance with state law.

4. Release of Claims and Carve-Outs

• Employee releases Company and affiliates from all claims through the signing date arising from employment or separation.
• Carve-outs: enforcement of this Agreement; vested benefits; claims arising after signing; unemployment or workers compensation benefits; indemnification rights; rights that cannot be waived by law; right to file or cooperate with agencies (EEOC, NLRB, DOL, SEC, OSHA, state equivalents); whistleblower and protected disclosures; NLRA Section 7 rights for non-supervisory employees; Speak Out Act and CA Silenced No More Act (SB 331) protections.
• Unknown claims - CA Civil Code § 1542 waiver (REQUIRED):

"A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party."

Employee expressly waives and relinquishes all rights under California Civil Code section 1542 and acknowledges understanding that Employee may later discover claims or facts that could have materially affected this Agreement. Employee nevertheless intends to release all claims, known or unknown.

5. ADEA/OWBPA (if 40 or older)

• Consideration period: [21 or 45] days; revocation period: 7 days after signing.
• Written advice to consult independent counsel; employee acknowledges opportunity to do so.
• If part of group exit, attach required decisional-unit disclosures where applicable.

6. Confidentiality, Non-Disparagement, and Protected Disclosures

• Confidentiality limited to Agreement terms and underlying negotiations, subject to legal requirements and protected disclosures.
• Non-disparagement (CA Silenced No More Act - SB 331 compliance): Mutual, time-limited, excludes truthful testimony, agency filings, and protected concerted activity. REQUIRED LANGUAGE: "Nothing in this agreement prevents you from disclosing information about unlawful acts in the workplace, including harassment, discrimination, or any other conduct you have reason to believe is unlawful." (Gov't Code § 12964.5)
• Protected disclosures: nothing restricts reporting suspected illegality, harassment, discrimination, retaliation, wages, or safety issues to government agencies or making disclosures protected by the Speak Out Act or CA Silenced No More Act (SB 331, effective Jan 1, 2022).
• Settlement amount confidentiality: Permitted (not prohibited by SB 331), subject to employee's right to disclose unlawful workplace conduct.

7. Restrictive Covenants and No-Rehire (Optional)

• Non-compete agreements VOID in CA (Bus. & Prof. Code § 16600, expanded Jan 1, 2024 by SB 699 & AB 1076):
• ALL non-compete agreements unenforceable regardless of where/when signed (§ 16600.5)
• Employer MUST notify current/former CA employees that any non-compete provisions are VOID (AB 1076, notice required by Feb 14, 2024)
• Civil violation to require employee to sign non-compete; private right of action with injunctive relief, actual damages, attorney's fees
• DO NOT include non-compete language in CA separation agreements
• Confirm continuing obligations under existing NDAs and invention assignment agreements (permissible if protecting trade secrets/proprietary information).
• Non-solicit: Review enforceability under CA law (limited circumstances only; generally disfavored).
• No-rehire clause optional; include only if lawful in CA and consistent with public policy.

8. Return of Property and Information Security

• Employee confirms return of all devices, files, credentials, and confidential information; no copies retained; accounts access terminated except as required by law.

9. Dispute Resolution

• Governing law: CA.
• Forum: [court location]; arbitration optional. If arbitration is selected, exclude claims that cannot be compelled to arbitration (for example, claims covered by the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act) and allow small-claims court access.
• Jury waiver only if enforceable under CA law.

10. State-Specific Overlay Checklist (CA)

• ☑ Final wage timing: Immediate if terminated; last day if quit w/72hr notice; 72hrs if quit w/o notice
• ☑ PTO payout MANDATORY: ALL accrued/unused PTO = earned wages; MUST be included in final pay
• ☑ Waiting time penalty: Up to 30 days average daily wage for late payment
• ☑ Civil Code § 1542 waiver: MUST include verbatim statutory language + express waiver of unknown claims
• ☑ Silenced No More Act (SB 331): Non-disparagement MUST include carve-out for unlawful workplace conduct disclosures (Gov't Code § 12964.5)
• ☑ 5-day consideration period: Required when agreement limits discussion of workplace conditions
• ☑ Non-compete BAN: Bus. & Prof. Code § 16600/16600.5 - ALL non-competes VOID; DO NOT include
• ☑ AB 1076 notice requirement: Employer must notify current/former CA employees existing non-competes are void
• ☑ Non-solicit: Generally disfavored; review narrow enforceability under CA law
• ☑ No use-it-or-lose-it: Vacation cannot expire; employer may cap accrual but must pay all accrued PTO
• ☐ Translation or readability requirements: [If applicable based on employee population]
• ☐ WARN Act notice: If applicable to mass layoff or plant closing

11. Signatures

Employer: ___________________________ Date: __________
Name/Title: __________________________

Employee: ___________________________ Date: __________

[Optional exhibits: OWBPA group disclosure; payment schedule; reference letter; restrictive covenant summary; 1542 or other unknown-claims waiver text.]