If you have reached an agreement with your employer to terminate your employment then you may be asked to sign a Settlement Agreement. This may arise in circumstances such as voluntary redundancy, early retirement or dismissal, but Settlement Agreements are also offered in relation to a range of other potential employment law claims. Settlement Agreements used to be called Compromise Agreements and may still be referred to as such.
When you sign a Settlement Agreement you are agreeing that you will not bring any claims referred to in the Settlement Agreement against your employer, and in return they will offer you a compensation payment. It is important to remember that just because you are offered a Settlement Agreement, it does not necessarily mean that you might have a good claim against your employer. It does however give your employer peace of mind that no claims will be forthcoming, which is why they are so commonplace.
In order for a Settlement Agreement to be legally binding you are required to receive advice from a relevant independent adviser as to the terms and effect of the proposed Settlement Agreement. This is to ensure that you fully understand what you are agreeing to in return for the settlement payment. What is more – to ensure that every one can access this advice it is usual for your employer to pay for it.
As you may be settling a lot of potential claims in return for the payment, we can also advise you on whether the compensation payment you have been offered is reasonable. If you want help with negotiations or exit strategies then our team will be more than happy to help you with this.
It is also important to remember that only those things that are written in the Settlement Agreement are legally binding. So if your employer makes any offers, ensure that they are accurately recorded in the wording of the Settlement Agreement, or annexed to it (for example, agreed reference wording or emails detailing any outstanding expenses).
If you are considering leaving your employment then it may be worth broaching the question of a Settlement Agreement with your employer, to give all parties finality at the end of the employment relationship. Likewise, if your employer is considering terminating your employment then you may be offered a Settlement Agreement. Either way, our team of specialist employment law advisers will be happy to assist you.
If you have require advice on a Settlement Agreement, or have any questions about your employment rights, then we can help. Here at Beecham Peacock we have a trusted relationship with some of the largest trade unions in the country to protect your working rights. For further information call us on 0191 232 3048 or email enquire@beechampeacock.co.uk.
