SEVERANCE AND MUTUAL RELEASE AGREEMENT
(Washington)
TABLE OF CONTENTS
- Document Header
- Definitions
- Operative Provisions
3.1 Severance Benefits
3.2 Benefits Continuation
3.3 Withholding; Tax Matters - Representations & Warranties
- Covenants & Restrictions
5.1 Confidentiality of Proprietary Information
5.2 Non-Disparagement
5.3 Return of Company Property - Default & Remedies
- Risk Allocation
7.1 Mutual Release of Claims
7.2 Indemnification/Hold-Harmless
7.3 Limitation of Liability
7.4 No Admission of Liability - Dispute Resolution
8.1 Governing Law
8.2 Forum Selection
8.3 Arbitration (Optional)
8.4 Jury Trial Waiver (Optional)
8.5 Limited Injunctive Relief - General Provisions
9.1 Entire Agreement; Integration
9.2 Amendment; Waiver
9.3 Assignment
9.4 Severability; Reformation
9.5 Successors & Assigns
9.6 Counterparts; Electronic Signatures - Execution Block
- ADEA/OWBPA ACKNOWLEDGMENTS & SIGNATURE PAGES
1. DOCUMENT HEADER
This Severance and Mutual Release Agreement (this “Agreement”) is made and entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between [COMPANY LEGAL NAME], a [STATE/JURISDICTION] [ENTITY TYPE] (the “Company”), and [EMPLOYEE LEGAL NAME] (“Employee”). The Company and Employee may be referred to individually as a “Party” and collectively as the “Parties.”
RECITALS
A. Employee’s employment with the Company will terminate effective [TERMINATION DATE] (the “Separation Date”).
B. The Parties desire to resolve fully and finally any and all matters between them, including but not limited to those arising out of Employee’s employment or the termination thereof, in exchange for the consideration described herein.
C. The Parties enter into this Agreement with the intent that it be a complete, enforceable, and binding release pursuant to applicable federal and Washington State law, including the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq. (“ADEA”), and the Older Workers Benefit Protection Act, 29 U.S.C. § 626(f) (“OWBPA”).
NOW, THEREFORE, in consideration of the promises, covenants, and agreements herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
2. DEFINITIONS
For purposes of this Agreement, the following terms shall have the meanings set forth below:
“Affiliate” means any entity controlling, controlled by, or under common control with the Company.
“Company Group” means the Company and its present and former parents, subsidiaries, Affiliates, predecessors, successors, assigns, and their respective current and former directors, officers, employees, agents, benefit plans, fiduciaries, and insurers.
“Consideration Period” means the period of [21 / 45] consecutive calendar days during which Employee may review and consider this Agreement before signing, as required by the OWBPA.
“Releasees” means, collectively, the Company Group.
“Severance Amount” means a lump-sum payment of [US$__] less required deductions and withholdings.
“Severance Period” means the period commencing on the Separation Date and ending [NUMBER] weeks thereafter.
[// GUIDANCE: Add or edit definitions as needed to conform to Company policy or business terms. Ensure any new defined terms are capitalized consistently throughout.]
3. OPERATIVE PROVISIONS
3.1 Severance Benefits
(a) Severance Payment. Subject to Employee’s timely execution and non-revocation of this Agreement, the Company shall pay the Severance Amount within [NUMBER] days after the Revocation Period (as defined in Section 11.4) expires.
(b) COBRA/Benefits Continuation. The Company shall pay the full employer portion of COBRA premiums for Employee (and, if applicable, eligible dependents) for the Severance Period, or until Employee becomes eligible for comparable coverage elsewhere, whichever occurs first.
(c) Outplacement. The Company shall provide outplacement services not to exceed [DOLLAR CAP] and to be used within [NUMBER] months of the Effective Date.
3.2 Benefits Continuation
Except as expressly provided herein, Employee’s participation in all Company benefit plans shall cease as of the Separation Date in accordance with the terms of such plans.
3.3 Withholding; Tax Matters
All payments shall be subject to applicable federal, state, and local tax withholding. Employee acknowledges that neither the Company nor its counsel have provided tax advice and that Employee has had the opportunity to consult independent tax advisers.
4. REPRESENTATIONS & WARRANTIES
4.1 Mutual Authority. Each Party represents that it has full authority to enter into and perform this Agreement.
4.2 Employee Specific. Employee represents and warrants that:
(a) Employee has not filed or caused to be filed any charge, claim, or complaint against any Releasee that remains pending;
(b) Employee has returned or will promptly return all Company Property; and
(c) Employee is not relying on any statement or representation by the Company not contained in this Agreement.
4.3 Survival. The representations and warranties herein shall survive the Effective Date.
5. COVENANTS & RESTRICTIONS
5.1 Confidentiality of Proprietary Information
Employee shall not disclose or use any confidential or proprietary information of the Company Group, except as compelled by law following prompt written notice to the Company.
5.2 Non-Disparagement
Employee agrees not to make any false, disparaging, or derogatory statements concerning any Releasee. The Company shall direct its senior executives not to disparage Employee in any official Company statement.
[// GUIDANCE: Consider carving out truthful testimony pursuant to subpoena or governmental investigation.]
5.3 Return of Company Property
Employee affirms that all tangible Company Property (including documents and electronically stored information) has been returned or deleted, as applicable.
6. DEFAULT & REMEDIES
6.1 Notice and Cure. Before commencing any action for breach, the non-breaching Party shall provide written notice specifying the alleged breach and a ten-(10-) day opportunity to cure (if curable).
6.2 Remedies. In the event of Employee’s material breach of Sections 5.1 or 5.2:
(a) The Company may cease any unpaid severance benefits;
(b) The Company may seek recovery of previously paid severance to the extent permitted by law; and
(c) The Company may pursue equitable relief subject to Section 8.5.
7. RISK ALLOCATION
7.1 Mutual Release of Claims
(a) Employee Release. In exchange for the consideration described herein, Employee irrevocably and unconditionally releases and forever discharges the Releasees from any and all claims, liabilities, demands, and causes of action, whether known or unknown, arising on or before the Effective Date, including but not limited to claims under federal, state, or local law relating to employment, wages, hours, compensation, discrimination, retaliation, benefits, and torts, except (i) claims that cannot be waived by law, (ii) rights arising after Employee signs this Agreement, and (iii) rights to enforce this Agreement.
(b) Company Release. The Company releases Employee from any and all claims it may have against Employee arising out of the employment relationship or its termination, except (i) claims based on fraud, embezzlement, or willful misconduct, (ii) claims that cannot be waived by law, and (iii) rights to enforce this Agreement.
7.2 Indemnification/Hold-Harmless
Each Party shall indemnify and hold harmless the other from any breach of its respective representations, warranties, or covenants herein.
7.3 Limitation of Liability
IN NO EVENT SHALL EITHER PARTY’S TOTAL AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT EXCEED THE SEVERANCE AMOUNT, EXCEPT FOR LIABILITY RESULTING FROM A PARTY’S FRAUD OR WILLFUL MISCONDUCT OR ANY OBLIGATION TO INDEMNIFY THE OTHER PARTY FOR THIRD-PARTY CLAIMS.
7.4 No Admission of Liability
This Agreement is not, and shall not be construed as, an admission of liability by any Party.
8. DISPUTE RESOLUTION
8.1 Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of Washington and applicable federal law, without regard to conflict-of-law principles.
8.2 Forum Selection
Subject to Section 8.3, any action arising out of or relating to this Agreement shall be brought exclusively in the state or federal courts located in [COUNTY], Washington, and each Party irrevocably submits to such courts’ jurisdiction.
8.3 Arbitration (Optional)
If the box below is initialed by both Parties, all disputes (except those seeking injunctive relief under Section 8.5) shall be finally resolved by confidential, binding arbitration administered by [ARBITRATION ADMINISTRATOR] under its employment arbitration rules in [CITY], Washington. Judgment on the award may be entered in any court of competent jurisdiction.
[ ] Company Initials: __ [ ] Employee Initials: ____
8.4 Jury Trial Waiver (Optional)
To the extent permitted by law, each Party irrevocably waives any right to a trial by jury in any proceeding relating to this Agreement.
8.5 Limited Injunctive Relief
Notwithstanding Sections 8.2 and 8.3, either Party may seek temporary restraining orders or preliminary injunctions in a court of competent jurisdiction solely to enforce Section 5.1 or 5.2, subject to the limitation that any such relief shall be narrowly tailored and of limited duration.
9. GENERAL PROVISIONS
9.1 Entire Agreement; Integration. This Agreement constitutes the entire understanding of the Parties and supersedes all prior agreements concerning the subject matter hereof.
9.2 Amendment; Waiver. No amendment or waiver shall be effective unless in writing and signed by both Parties. A waiver on one occasion shall not constitute a waiver on any subsequent occasion.
9.3 Assignment. Neither Party may assign this Agreement without the prior written consent of the other, except that the Company may assign to a successor in interest in connection with a merger, consolidation, or sale of substantially all assets.
9.4 Severability; Reformation. If any provision is held invalid or unenforceable, it shall be severed, and the remaining provisions shall remain in full force. A court may modify any unenforceable provision to the minimum extent necessary to make it valid and enforceable.
9.5 Successors & Assigns. This Agreement shall bind and inure to the benefit of the Parties and their respective successors and permitted assigns.
9.6 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which shall be deemed an original. Signatures delivered via electronic means shall be deemed original signatures.
10. EXECUTION BLOCK
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.
COMPANY:
[COMPANY LEGAL NAME]
By: ____
Name: ____
Title: _____
Date: _________
EMPLOYEE:
[EMPLOYEE LEGAL NAME]
Date: _____
[// GUIDANCE: Insert notarization or witness blocks if Company policy or Washington law requires.]
11. ADEA/OWBPA ACKNOWLEDGMENTS & SIGNATURE PAGES
11.1 Acknowledgment of Knowing and Voluntary Waiver. Employee acknowledges that:
(a) this waiver of ADEA claims is knowing and voluntary;
(b) the consideration provided under this Agreement is in addition to anything of value to which Employee is already entitled;
(c) Employee has been advised to consult with an attorney before signing;
(d) Employee has [CONSIDERATION PERIOD] days to consider this Agreement; and
(e) Employee may revoke this Agreement within seven (7) days after signing.
11.2 Consultation with Counsel. Employee hereby certifies that Employee has consulted, or has had the opportunity to consult, with independent legal counsel.
11.3 Method of Revocation. To revoke, Employee must deliver written notice of revocation to [COMPANY REPRESENTATIVE NAME AND ADDRESS] no later than 11:59 p.m. Pacific Time on the seventh (7th) calendar day after Employee signs this Agreement.
11.4 Effective Date. This Agreement shall become effective on the eighth (8th) calendar day after Employee signs, provided it has not been revoked (“Revocation Period”).
Employee’s Signature (confirming the above ADEA/OWBPA acknowledgments):
[EMPLOYEE LEGAL NAME]
Date: _____
[// GUIDANCE:
1. If this Agreement is offered in connection with an exit incentive or group termination program, insert OWBPA-required disclosures (job titles, ages, etc.).
2. Review COBRA and Washington mini-COBRA requirements for employers with <20 employees.
3. Confirm payment timing complies with RCW wage-payment statutes (final wages, commissions).
4. Delete optional provisions or brackets once business terms are finalized.
5. Update forum selection county to align with the Company’s principal place of business or Employee’s work location for enforceability.
]