A growing number of employers expect a departing employee to sign a document agreeing to the termination or severance arrangements that have been offered by the company; and those terms often include restrictions on post-employment activities. This is especially true with senior management, and people who have direct contact with customers or clients. While they are not required by law, employment exit agreements serve as a mechanism to sever an employment relationship.
An exit agreement is a legal contract that protects both parties from the risk of future legal action. Exit agreements will be enforceable as long as they contain the necessary requirements of any legally enforceable contract. Therefore, before you sign the agreement, it is important for you to understand that signing an exit agreement almost entirely prevents you from bringing a subsequent legal claim against your employer. Moreover, these agreements are binding terms and conditions that protect the rights of the employer and provide the employer with legal recourse should the employee breach the terms of the agreement. If you violate the terms of the exit agreement, your employer may have legal recourse available.