The Constructive Dismissal Settlement Agreement is a crucial document used in Irish employment law when an employee has resigned or intends to resign due to their employer's conduct, which they believe amounts to a fundamental breach of the employment contract. This document serves to formally settle any potential or actual constructive dismissal claims, providing certainty and closure for both parties. It typically arises in situations where working relationships have broken down irretrievably, but parties wish to avoid litigation through the Workplace Relations Commission. The agreement must comply with Irish employment law, particularly the Unfair Dismissals Acts 1977-2015, and includes detailed provisions covering financial settlement, confidentiality, tax implications, and future obligations. Independent legal advice is mandatory for the employee, ensuring they fully understand their rights and the implications of signing the agreement.
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1. Parties: Identifies and defines the employer and employee who are parties to the agreement
2. Background: Outlines the employment history, circumstances leading to constructive dismissal claim, and parties' intention to settle
3. Definitions: Defines key terms used throughout the agreement
4. Settlement Terms: Details the settlement payment amount, payment method, and timing
5. Tax Indemnity: Addresses tax treatment of the settlement payment and related indemnities
6. Waiver of Claims: Employee's waiver of all claims against the employer, with specific reference to constructive dismissal
7. Confidentiality: Obligations regarding confidentiality of the agreement and its terms
8. Return of Property: Requirements for returning company property and documents
9. Post-Termination Obligations: Ongoing obligations including confidentiality of business information
10. Reference: Terms regarding the provision of employment references
11. Legal Advice: Confirmation that the employee has received independent legal advice
12. Entire Agreement: Confirms this agreement represents the entire understanding between parties
13. Governing Law: Specifies Irish law as governing law and jurisdiction
14. Execution: Signature blocks and execution requirements
1. Non-Disparagement: Mutual obligations not to make derogatory statements - recommended when there's potential for reputational damage
2. Garden Leave: Include if employee is to remain employed but not working during notice period
3. Outplacement Support: Details of any career transition services offered - include if part of settlement package
4. Insurance Continuation: Terms regarding continuation of insurance benefits - include if applicable
5. Equity/Share Options: Treatment of any share schemes or equity - include if employee has such arrangements
6. Restrictive Covenants: Post-employment restrictions - include if new restrictions are being imposed or existing ones modified
7. Press Release: Agreed public statements about the departure - include for senior executives or public-facing roles
1. Schedule 1 - Payment Breakdown: Detailed breakdown of settlement payment components and tax treatment
2. Schedule 2 - Claims Being Settled: Comprehensive list of statutory and contractual claims being waived
3. Schedule 3 - Company Property: Itemized list of company property to be returned
4. Schedule 4 - Agreed Reference: Template of agreed employment reference
5. Appendix A - Legal Adviser's Certificate: Certificate from independent legal adviser confirming advice given
6. Appendix B - Resignation Letter: Template resignation letter if required as part of settlement
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