Employment settlement agreements

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If you have been offered an employment settlement agreement (previously known as a compromise agreement) and you are unsure what to do next, our employment solicitors and legal experts can help you.

 

What should you do with an employment settlement agreement?

If your employer has given you a settlement agreement you must obtain independent legal advice on the terms and effects of the proposed agreement. Without this, the agreement will not be legally binding.

It is important to ensure that you understand all of the options available to you before you sign the agreement such as instructing a solicitor to negotiate better terms on your behalf or bringing an employment tribunal claim.

When it comes to costs, in most circumstances, your employer will contribute towards your legal fees for getting advice on the agreement and this contribution is usually enough to cover all legal fees. However, if the contribution doesn’t cover all costs, it may be possible to increase this fee contribution during negotiations with your employer.

 

How can we help with your employment settlement agreement?

At SAS Daniels we don’t use complicated legal jargon, we set out clearly what the settlement agreement means – ensuring you only sign the agreement when you feel comfortable to do so.

Our experienced employment law and HR team will take you through the terms of the settlement agreement so that you are fully aware of its effect on your individual circumstances. We will also explain any alternative options which may be available to you to ensure you make a fully informed decision as to whether or not to enter into the agreement.

If you are unhappy with the proposed terms in your settlement agreement, we can work with you to negotiate better terms on your behalf and ultimately, aim to get you the settlement which is fair in all the circumstances and in your best interests.

If you have been offered an employment settlement agreement (previously known as a compromise agreement) and you are unsure what to do next, our employment solicitors and legal experts can help you.

 

What should you do with an employment settlement agreement?

If your employer has given you a settlement agreement you must obtain independent legal advice on the terms and effects of the proposed agreement. Without this, the agreement will not be legally binding.

It is important to ensure that you understand all of the options available to you before you sign the agreement such as instructing a solicitor to negotiate better terms on your behalf or bringing an employment tribunal claim.

When it comes to costs, in most circumstances, your employer will contribute towards your legal fees for getting advice on the agreement and this contribution is usually enough to cover all legal fees. However, if the contribution doesn’t cover all costs, it may be possible to increase this fee contribution during negotiations with your employer.

 

How can we help with your employment settlement agreement?

At SAS Daniels we don’t use complicated legal jargon, we set out clearly what the settlement agreement means – ensuring you only sign the agreement when you feel comfortable to do so.

Our experienced employment law and HR team will take you through the terms of the settlement agreement so that you are fully aware of its effect on your individual circumstances. We will also explain any alternative options which may be available to you to ensure you make a fully informed decision as to whether or not to enter into the agreement.

If you are unhappy with the proposed terms in your settlement agreement, we can work with you to negotiate better terms on your behalf and ultimately, aim to get you the settlement which is fair in all the circumstances and in your best interests.

Speak to a member of our employment team on 0161 475 7668 or get in touch via our contact form

Speak to a member of our employment team on 0161 475 7668 or get in touch via our contact form

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Why work with us

Why choose SAS Daniels for employment law support?

Practical and commercial advice from our knowledgeable and approachable team. We deal with all areas of employment law and can help with any query for businesses or individuals.

Frequently asked questions about settlement agreements

  • As a business, what legal advice do I need to offer to employees on settlement agreements?

    An employee needs to take independent legal advice before signing a settlement agreement and the employer should provide a contribution towards those fees. The employer is not obliged to cover the fees in full, just to contribute.
  • Can the employee’s employment rights be waived in the settlement agreement?

    By signing a settlement agreement, an employee agrees to certain terms, such as waiving their right to bring claims against the employer. However, not all claims can be settled under a settlement agreement. Claims in respect of accrued pension rights and personal injury claims that have not yet arisen, or that the employee could not reasonably be aware of, cannot be settled. Claims in respect of certain statutory rights also cannot be settled, in particular claims for failure to inform and consult with appropriate representatives on collective redundancies or on the transfer of an undertaking (TUPE), as well as claims for statutory maternity, paternity, adoption or shared parental pay.  
  • How to start a settlement agreement process with an employee

    To begin the process, an employer needs to ask the employee if they are willing to have a protected conversation, as per section 111A of the Employment Rights Act 1996. The protected conversation should consist of a discussion about what has led to the proposal of the settlement agreement (that could be concerns the employer has about the employee, for example in relation to conduct or performance, or it could be that the settlement agreement is an alternative to a redundancy process). Once this has been discussed, a settlement offer should be made by employer to employee. The employee should then be given at least 10 days to consider whether they want to accept that offer.
  • What happens if an employee breaches a settlement agreement?

    If the employee breaches any material terms of the settlement agreement, the employer may be able to claim for breach of contract to rectify the breach and may also seek to recover any payments made to the employee under the agreement terms. If the employer is successful, the employee may be ordered to repay all or some of the money they have been paid and they may also be required to repay the employer’s legal fees.
  • What’s an average settlement agreement payout?

    There are no fixed rules in terms of what offer should be made under a settlement agreement, so this will vary from case to case.
  • What is the difference between a compromise and settlement agreement?

    They are the same thing. The phrase ‘compromise agreement’ has been replaced by ‘settlement agreement’.

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