What is a Settlement Agreement?

A Settlement Agreement is an agreement used to settle employment claims which you may have against your employer. It will usually involve the termination of your employment and a financial package will be offered to you, in return for the settlement of your claims.

The Agreement will set out details about the settlement of claims, any termination date of employment, confirmation of any notice pay and compensation, amongst other payments.

Usually, there will also be other clauses in the Agreement, such as:

• neither party will make derogatory comments about the other
• both parties will keep confidential the existence of the Agreement and its terms and
• your employer will promise to provide an agreed reference for you

Do you need to take independent legal advice?

If you are offered a Settlement Agreement which you are interested in signing, you will need to take independent legal advice on its terms.

Normally, your employer will pay a contribution towards your legal costs for this advice.

If you come to us for advice, we will advise you about whether you have been offered a reasonable settlement package, taking into account the value of your claims and entitlements. In some circumstances, we may be able to get a better deal for you, by negotiating with your employer, on your behalf.

Can you ask your employer to offer you a Settlement Agreement?

In most cases, it is the employer who makes an offer of a Settlement Agreement. However, if you were prepared to leave your job and you thought that you had potential employment claims, you could ask your employer about the possibility of an Agreement; alternatively, we can approach your employer, on your behalf.

What are the benefits of signing a Settlement Agreement?

Some of the benefits of a Settlement Agreement are that:

• you can get a written assurance about what will be said in a reference about you
• you achieve a predictable outcome, compared to bringing Employment Tribunal proceedings; and
• it is normally much quicker, cheaper and less stressful than making a claim in the Employment Tribunal.

Concluding a Settlement Agreement allows you to draw a line under any dispute and move forward in your career.

If you need any help, please give Julia Woodhouse a call on 01926 831231 or email her at jhw@blytheliggins.co.uk.

The above does not provide you with advice.