Departure Letter Template for England and Wales

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Key Requirements PROMPT example:

Departure Letter

"I need a Departure Letter for a senior software engineer who is leaving voluntarily on March 15, 2025, including provisions for unvested stock options and an agreed form of reference."

Document background
A Departure Letter is commonly used in England and Wales when an employee's employment is being terminated, whether through mutual agreement, redundancy, or other circumstances. The document typically includes essential information about the termination date, final payments, benefit arrangements, and ongoing obligations. A Departure Letter can be used independently for straightforward departures or in conjunction with a Settlement Agreement for more complex situations where a formal waiver of claims is required. The document helps ensure clarity and compliance with UK employment law while reducing the risk of future disputes.
Suggested Sections

1. Addressee Details: Full name and address of the departing employee

2. Termination Date: Confirmation of last day of employment and any garden leave arrangements

3. Financial Terms: Details of final salary, notice pay, statutory payments and any ex-gratia payments

4. Benefits Treatment: Treatment of existing benefits including healthcare, pension, share schemes and company car

5. Company Property: Requirements and timeline for return of company property including equipment, documents and data

6. Confidentiality Obligations: Ongoing confidentiality requirements and treatment of company information

Optional Sections

1. Reference Provision: Terms of employment reference and agreed wording if applicable

2. Post-termination Restrictions: Reminder or modification of existing restrictive covenants and non-compete clauses

3. Legal Advice: Confirmation of right to seek independent legal advice and contribution to legal fees

4. Outplacement Support: Details of any career transition or outplacement support being offered

Suggested Schedules

1. Settlement Agreement: Formal agreement containing full terms and waiver of claims

2. Payment Schedule: Detailed breakdown of all payments including tax treatment and payment dates

3. Benefits Summary: Comprehensive list of benefit termination dates and any continuation or conversion options

4. Company Property List: Itemized list of company property to be returned

Authors

Alex Denne

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

Industries

Employment Rights Act 1996: Primary legislation covering basic employment rights, statutory notice periods, unfair dismissal provisions, and redundancy payments

Equality Act 2010: Legislation governing protection against discrimination, equal pay provisions, and matters related to harassment and victimization

Working Time Regulations 1998: Regulations covering holiday pay calculations and treatment of accrued but untaken holiday

National Minimum Wage Act 1998: Legislation ensuring all payments meet minimum wage requirements during employment and settlement

Income Tax (Earnings and Pensions) Act 2003: Tax legislation governing treatment of termination payments, including tax-free threshold of £30,000 under Section 403

Employment Relations Act 1999: Legislation covering right to be accompanied at meetings and collective agreement considerations

Companies Act 2006: Corporate legislation relevant for director duties and post-termination restrictions

GDPR and Data Protection Act 2018: Data protection legislation governing obligations and personal data handling post-employment

Protection of Employment Regulations 2006: Regulations covering TUPE (Transfer of Undertakings) considerations in employment transfers

Limitations Act 1980: Legislation setting time limits for claims and enforcement periods in employment matters

Trade Union and Labour Relations (Consolidation) Act 1992: Legislation governing collective consultation requirements and trade union rights

Common Law Principles: General contract law principles developed through case law that apply to employment contracts and settlement agreements

ACAS Code of Practice: Practical guidance on discipline and grievance procedures that must be considered in employment terminations

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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