What is a Settlement Agreement?
Employment Settlement Agreements, previously known as compromise agreements, are contracts made between an employer and employee or other worker, in which they agree specific terms and conditions relating to the employment relationship. They are called settlement agreements because they are used to settle existing or potential employment disputes.
A settlement agreement may also be signed at the end of the employment relationship, for example, following redundancy, a dismissal or a mutual termination.
There are certain legal requirements which have to be complied with if a settlement agreement is to be enforceable. This includes the requirement that the employee or worker signing the settlement agreement obtains independent legal advice.
The fee for obtaining legal advice on a settlement agreement is normally borne by the employer.
Contact Us
Contact us for advice on settlement agreements relating to:
- Redundancy
- Employment tribunal claims
- Mutual termination
- Internal workplace disputes
Our experience advising both employers and employees gives us a unique, balanced perspective on the employment relationship and the terms of any settlement agreement.
Settlement Agreements and Redundancy
Sometimes, employees are unhappy with the redundancy process which they may feel has been unfair to them. An employer may therefore ask employees to sign settlement agreements to reduce the prospects an employment tribunal claim.
Settlement Agreements and Termination Negotiations
Employment relationships don’t always go to plan. Whether the worker concerned is an employee, a consultant or a contractor, there are several reasons why the parties to an employment relationship may decide that it’s no longer working for them. If that is your situation, we can advise you on how to have what is known as a ‘protected’ conversation with your employer with a view to signing a settlement agreement for a mutual termination. The settlement agreement will state at the outset that it is signed to record the terms of a mutual termination between the parties.
Protected conversations are confidential discussions about terminating an employment relationship. It’s important to bear in mind that these are not suitable where there has been alleged unlawful conduct, such as discrimination, against the employee.
Settlement Agreements and Workplace Relationships
Settlement agreements are sometimes used to set out the terms on which an employer and employee agree to continue the employment relationship after there has been an internal dispute. This is especially so in cases of workplace discrimination where an employer may have accepted that the employee has been unlawfully discriminated against and has agreed to pay compensation to the employee in the form of injury to feelings. In such cases, a settlement agreement will set out a summary of the background to the dispute, with details of the compensation to be paid, and procure that the employee will not bring any legal proceedings.
Williams Hortor can advise on the terms of the settlement agreement before you sign it so that you understand what you are agreeing to, and to help ensure that future your employment rights are not compromised by anything contained in it.
We can also help you to negotiate a better settlement or termination sum if the circumstances of the termination of your employment warrant that.
Contact Us
Contact us for an initial conversation about your Settlement or Termination Agreement by calling us on 01920 451 921 or emailing us at info@williamshortor.com.
