Final answer:
A Memorandum of Agreement/Memorandum of Settlement is a legally binding document that formalizes terms of a settlement between parties, often related to employment contracts or labor relations.
Step-by-step explanation:
A Memorandum of Agreement/Memorandum of Settlement is a document that formalizes the terms of a settlement between two or more parties. It is a legally binding document that outlines the detailed terms and conditions that have been agreed upon after negotiations. Although it could potentially include details such as company dress code or security protocols, these are not the primary purpose of the agreement. Instead, it serves as an official record that covers various aspects of employment agreements, such as salary, job responsibilities, workplace policies, and more. It is closely related to an employment contract, which is signed by an employee and an employer and includes similar details.
Moreover, this type of agreement may be related to labor relations and would establish procedures for establishing a union that firms are obligated to follow, as well as setting up the National Labor Relations Board for deciding disputes. Hence, the correct option in the given scenario is that a Memorandum of Agreement/Memorandum of Settlement formalizes terms of a settlement (Option 3).