For expert legal advice on Settlement Agreements contact our Business Employment Solicitors on Freephone 0808 175 8000 or complete our online contact form and we would be happy to call you.
Settlement agreements (often still referred to by their previous name, compromise agreements) enable employers to terminate an employee’s employment, safe in the knowledge that the employee will not able to bring an employment related claim at the employment tribunal or any other court. This will usually involve offering a financial incentive to the employee in exchange for them agreeing to waive their contractual and statutory rights arising out of their employment or its termination. Settlement agreements are therefore effective in circumstances where there are flaws in the procedure that an employer has followed prior to dismissing an employee or where an employer is keen to avoid the cost and negative attention associated with legal proceedings.
Settlement agreements must comply with certain statutory requirements in order to effectively waive an employee’s right to bring an employment related claim against their employer, and a failure to ensure that these requirements are met can cause an employer to remain exposed to claims by the employee which it thought had been settled.
Therefore we strongly recommended that businesses seek advice before entering into a settlement agreement with departing employees to ensure that their interests are properly protected and that the terms and effect of the settlement agreement reflect their intentions.
Employers are now able to have ‘protected conversations’ with employees during which they can raise the possibility of the parties entering into a settlement agreement to facilitate the termination of employment, without fear of the employee being able to refer to that conversation in evidence during any future claim for unfair dismissal. This allows employers greater freedom in how to address particular issues with members of staff. However, the same protection is not available if the employee were to later allege discrimination or even automatic unfair dismissal. Further, no protection is available if the employer behaves improperly during the ‘protected conversation’. Indeed, in some circumstances it may be more appropriate to have a ‘without prejudice’ conversation rather than a ‘protected conversation’.
We understand that the issues surrounding ‘protected conversations’, ‘without prejudice’ discussions and settlement agreements can be confusing for employers. Our primary aim when advising on such matters is to provide clear and commercially robust advice to get employers to where they need to be, as quickly and as cost-effectively as possible. To that end, our team of business employment solicitors have a wealth of experience of advising on what an appropriate settlement offer would look like and how best to structure the package, drafting and negotiating settlement agreements (both straightforward and complex) and advising on how to conduct any surrounding settlement negotiations or ‘protected conversations’.
Redundancies and Settlement Agreements
We also have experience of managing bulk settlement agreement projects (designing and implementing a process for use by employers in those circumstances where groups of employees are being asked to enter into settlement agreements) and acting as independent advisers in large scale redundancy and reorganisation exercises.
Call our Business Employment Solicitors today on Freephone 0808 175 8000 or contact us online.
If your business needs settlement agreement advice, we invite you to contact our expert team of solicitors. We will be very pleased to talk through your options without obligation, and if further advice is required, provide a fee proposal for your consideration.