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Our Settlement Agreements (formally known as compromise agreements) are fully compliant and are tailored to suit the needs of your organisation, to protect you and your business! In practice, there is little difference between a Compromise Agreement and a Settlement Agreement.
However, under the terms of the new Settlement Agreements, discussions about the offer of such an Agreement cannot be used in an ordinary unfair dismissal claim unless there has been improper behaviour by the employer such as placing undue pressure on the employee to get it signed.
There are no guarantees that an employee will accept your proposed terms, either because they did not want the employment to terminate or perhaps you may not be offering them a sufficient settlement sum compared to what they may be entitled to if they decided to litigate. Furthermore, if the idea of a settlement agreement has been introduced by the employer it may have come as a little bit of a surprise to them and they may need a couple of days to get over the initial shock and have time to get used to the idea.
It is comforting to know that settlement agreements are very common between employers and employees and by the very nature of them being confidential people won’t be discussing that they too may have also agreed to terminate their employment at some point in time through either a settlement agreement or a compromise agreement.
There are situations where it would be dangerous to offer a settlement agreement. For example, if you offer one prematurely (as discussed above) which the employee was not expecting and if the employee refuses to accept they may argue that the relationship of trust and confidence has been destroyed which may entitle them to resign and claim constructive dismissal.
In a situation like this your solicitor would need to provide you with information, documents and scripts on having a protected conversation to ensure the above situation would not arise. This is not applicable in all situations (i.e. discrimination, Tupe and statutory claims known as automatic unfair dismissal such as whistle blowing) and is another reason why it is very important you seek independent advice with a reputable firm who has experience in advising and drafting fully comprehensive settlement agreements.
Key points about settlement agreements
- Settlement agreements are legally binding contracts that waive an individual’s rights to make a claim covered by the agreement to an employment tribunal or court.
- The agreement must be in writing.
- They usually include some form of payment to the employee and may often include a reference.
- They are voluntary.
- They can be offered at any stage of an employment relationship.
Settlement agreements are legally binding contracts which can be used to end an employment relationship on agreed terms. These agreements can be proposed by either an employer or an employee, although it will normally be the employer.
The main points for employers to be aware of is that in essence they are offering the employee an agreed sum by way of a settlement sum in exchange for them waiving their rights to bring any future claims against the company (with the exception of pension rights and personal injury claims) and confidentiality of those terms is covered within the agreement, along with other main terms.
Once a valid settlement agreement has been signed, the employee will be unable to make an employment tribunal claim about any type of claim which is listed on the agreement.
The support we have received from Laveer Legal has been extremely good. Our contact, Samantha, has always responded promptly to any questions or advice we required, and often followed up when we had not responded, including emails out of hours. An extremely professional service with a friendly informal approach – the perfect balance. Five Star review Rob Slater, Center Manager
New Mills Town Council On seeking out a Barrister and Employment Legal Specialist, Ben Norman and Samantha Quinn of Laveer Legal were approached as highly recommended suppliers of advice in the area of Employment Law / Human Resources , to advice, guide and represent the Council in a Employment Tribunal Hearing. Within a very short period of only one week after engagement, both Ben and Samantha, had worked their way through what can only be described as a very long running and complex case, and it is more than fair to say had a very firm understanding of the issues involved. It was glaringly obvious that the engagement of both Ben and Samantha, ensured the success of the case in favour of the Council, as both had a wealth of knowledge and experience in dealing with such matters Ben and Samantha went that extra mile in providing support and immediate responses, to any difficult situation that arose around the time of the hearing. They both have a strong mix of being Professional and Affable, with definite defined communication skills, which made working with them a very pleasant and stress free experience. I would highly recommend Ben and Samantha of Laveer Legal, for any organisation who are seeking a quality professional service provider, to deal with employment and human resources matters, without hesitation. David Ian Lamb. Chair of the Council
The team at Laveer are consummate professionals….diligent, knowledgable, responsive and always willing to go the extra mile. I recommend their services highly
I commissioned Ben Norman and Samantha Quinn from Laveer Legal to review a contract for me. In almost 20 years of commissioning employment advice in 5 different countries, I don’t know when I have ever had such a concise and clear response. They put my mind at rest on some issues; confirmed my concerns about other points and provided me with solid arguments with which to address them in negotiations; and raised some further issues for me to be aware of. I couldn’t have asked for more, and I would certainly recommend their services.