Our employment law team will provide clear legal advice and support throughout the settlement agreement process.

We will ensure the final document is legally binding and is compliant with the relevant aspects of employment law. Plus should you require we can assist when wider scale changes to the staff are required and multiple settlement agreements are needed.

A settlement agreement is a legally binding contract that records an employee’s agreement not to pursue a claim relating, in most cases, to the termination of their employment against their employer in exchange, typically, for a payment of money.

Under employment law terms, drafting of a settlement agreement is one of the only methods an employer has of minimising employment liabilities and militating against future employee claims. Settlement agreements are becoming increasingly popular; because once the employer, the employee and the employee’s solicitor has signed a settlement agreement, that contract brings an end to the matter and any legal claim one has over the other.

A settlement agreement can cover almost any kind of potential Employment Tribunal claim including:

• Discrimination
• Breach of contract/wrongful dismissal
• Unpaid Wages
• Unfair dismissal

There are some conditions that need to be in place for the settlement agreement to be legally binding. For example:

• The agreement must be in writing
• Identify the employee’s legal advisor (who must have professional indemnity insurance)
• Relate to a specific complaint made by the employee
• The employee must received independent legal advice
• Include a statement of the nature of the dispute being settled
• Include a statement confirming that the conditions governing settlement agreements have been complied with

We have published several guides on settlement agreements, downloadable here.

If you require advise on settlement agreements or negotiating a severance package with an employee, then please contact our employment solicitors and expert legal team on 01780 757 589, request a call-back or complete our quick online enquiry form.