Golden parachute

The Golden Parachute (german golden parachute ) is a clause in contracts of executives, according to the case of a takeover of the company and the consequent abolition of the office or in case of early termination of the contract the person receives substantial payments, for example in the form of bonuses, stock options or combinations of different remuneration.

Such a clause allows the company to divest itself of no more desirable employees, although the duration of the contract is not yet complete and although the staff can be accused of no wrongdoing, which would entitle you to an early termination of the contract. On the other hand, this clause the employee financial protection in the event that his services are no longer welcome in the company.