What is a Settlement Agreement?
A Settlement Agreement (previously known as a “Compromise Agreement”) is a legally binding agreement following the termination of your employment.
Settlement agreements are often given to employees when they are being made redundant. However, they can also be offered to employees if an employer thinks they are performing badly in their job or are guilty of misconduct. In some cases, an employee will be aware that their boss is unhappy, while for others, being offered a settlement agreement can come as a shock.
Essentially, an employee is given money or severance pay in return for not bringing a claim against their employer. Each settlement agreement will vary but usually the documents will include clauses that deal with: the claims to be settled; the payments you will receive and the relevant tax issues; a confidentially/gagging clause (so you can’t bad mouth your employer) and any agreed reference from your employer. Once signed by both the employer and the employee and certified by an independent solicitor, a settlement agreement becomes legally binding.
How we can help
When you’re pulled into a meeting and asked to leave your job, it can be a shock. Later on, it can be hard to recall exactly what was said. The best advice is therefore to make a note about what happened and what was said as soon as possible. The next thing to do is get some decent advice. An employer will usually pay the legal costs for you to see a solicitor or qualified adviser independent of the employer as it is a legal requirement for the settlement agreement to be contractually binding on the employee.
An employment solicitor can help you consider whether you’re getting a good deal and whether you have any grounds for a claim against your employer – such as discrimination or unfair dismissal. If you’re facing a period of unemployment, you need to be able to meet your household living expenses until you get another job. One of the considerations you need to make is whether the money that is being offered is enough.
You need to consider why you are being offered the agreement and what rights you are being asked to waive as a result of you signing. Armed with this knowledge, you can often save legal costs by negotiating yourself directly with your employer and in our experience, you often end up with a better deal, which may include a bigger payment.
The employer will often insist that the settlement agreement be signed by a particular date, but you are not legally obliged to sign a settlement agreement and if you don’t sign the agreement, then your full employment rights are reserved for you to make a claim against your employer.
To see some typical terms of a settlement agreement and our advice on them, please click here.
Get in touch
For further information contact Justin Sadler or Paul Wild by telephone 0118 958 9711 or send an email to: [email protected] If this relates to settlement agreements send your email to: [email protected]
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Would like to place on record my thanks to Chris Miller who worked on our case. Great support and hard work to ensure we came out with a positive outcome. Would not hesitate to contact or recommend Chris, Justin and team to help with any future cases. Thanks again, Joe 
Joe Pollock
8/15/2019 - I have recently used Barrett & Co to assist me with my divorce and can only say good words about the experience. Paul Wild especially not only provided reassuring advice, but his professionalism (and indeed, that of everyone at Barrett & Co) made me feel supported throughout the whole process, and left me with the feeling that he genuinely cared about my situation. The level of dedication displayed by not only Paul but also Richard Ince in the conveyancing team was top notch, in particular when turning work around within tight timescales, and keeping me appraised throughout so nothing came as a surprise. I will definitely use Barrett & Co for any legal needs in the future - very highly recommended!
James Bigus
8/15/2019 - Barrett & Co come highly recommended. I recently worked with Alan Warnes on a property sale that was very complicated due to changes in the lease, and dealing with difficult and lengthy queries from the buyer's solicitors, and Alan guided me expertly through the process. His tenacity, patience, legal expertise and good humour were greatly appreciated. I have used Barrett & Co's services for previous property purchases and sales, for declarations of trust, and one of the partners also became executor to my parent's estate several years ago. They are very professional, and also warm, friendly solicitors to work with. I would not hesitate to engage them again if the need arises.
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8/06/2019 - Thanking Justin Sadler and Chris Miller for being so welcoming, understanding, supportive, very dedicated to our situation. They are very professional and a very committed legal team! Also the receptionists were always welcoming and kind. I would highly recommend Barrett and Co Solicitors in the first instance!
Miranda
8/01/2019 - I had Justin Sadler work with me, giving excellent advice and general support with a very difficult, complex case against an ex-business partner. Happy to say that I got a full settlement before going to court, as with that advice, I was in a very strong, empowered position to emphatically 'win' my case without incurring additional court costs!
Chris Voysey
7/31/2019 - Jane Whitfield was friendly and professional and I found the process of making a will to be easy and straightforward. I would thoroughly recommend.
Elaine Sutton
7/29/2019 - Great service and brilliant advice, value for money. Justin Sadler help me with employment law issues. Justin was very supportive and really help me understand a difficult situation. I would highly recommend him & Barrett & Co.
Oliver Clark
7/03/2019 - Great service and brilliant advice, value for money. Justin Sadler help me with employment law issues. Justin was very supportive and really help me understand a difficult situation. I would highly recommend him & Barrett & Co.
Oliver Clark
7/03/2019
