Settlement Agreement Solicitors
We advise well over 100 employees on settlement agreements each year so we know our way around these agreements extremely well. We advise employees of all levels from junior to employees at senior director level. The backgrounds and job functions are enormously varied as you can imagine. Please do call us to discuss your position – 0207 438 1060.
Settlement agreement legal fees
Usually your legal fees for our review are paid by your employer.
Should you sign or negotiate?
A settlement agreement is usually offered by an employer because the employer does not want to run the risk of a claim in the Employment Tribunal.
In deciding whether you should sign the settlement agreement offered or seek to negotiate for a better deal there are various factors to consider. We use our experience to guide you on the considerations.
Key points on settlement agreements
- The settlement agreement must be mutually agreed – you cannot be forced to sign a settlement agreement.
- Settlement agreements can cover any work place situation – settlement agreements are commonly used where redundancy situations arise but can also be offered in many other situations such as where a grievance has been raised, disciplinary action is pending or there is a general breakdown in relations between the employer and employee.
- Can employees ask for a settlement agreement? – employees can suggest a settlement agreement but should think very carefully and seek legal advice before doing so.
- Compensation – the employer has to pay your contractual rights such as notice pay and unused holiday. If you are being made redundant there are statutory payments required. Apart from your contractual and statutory rights any extra money is down to the facts such as a risk of you bringing a claim in the Employment Tribunal and negotiation skills.
- What types of claims, if any, could you bring against the employer if you reject the settlement agreement? – we always look at the prospects of success for you if you are considering negotiation.
- What are your future employment prospects? – if you are likely to get a new job quickly or already have another job lined up this impacts what you could claim if you reject an offer made.
- Restrictive covenants post termination of employment – if the employer wants to keep you out of the market and stop you from working for competitors this can increase the size of settlement you should push for.
- Tax issues – if the settlement agreement is not drafted properly you may be paying more tax than should be paid.
- References – you will not be entitled as of right to a reference from the employer if you sign a settlement agreement. Agreed forms of reference are often part of the negotiations.
- Shares and options – there is often value in these awards and your position needs to be considered and factored in.
How much compensation to expect?
Compensation offered under a settlement agreement is usually made up of 3 parts:
- Contractual entitlements;
- Redundancy pay (if applicable); and
- Compensation for loss of employment or directorship – this is where there may be scope for negotiation.
The first £30,000.00 of compensation can be paid tax free if the payment is in addition to contractual entitlements such as notice, bonus and or holiday pay.
Why do you need a solicitor?
By entering into a settlement or compromise agreement for any reason you warrant that you have no claims against your employer. Therefore, any claims you could have must be considered before you sign the agreement.
In our position as independent solicitors, you are able to discuss any potential claims in full confidence. The list of claims that you will be required to waive under the redundancy settlement agreement (and any other type of settlement agreement) is comprehensive. We break down down the terms and focus on what is important to you.
There is no going back once you have signed your settlement agreement. The settlement agreement provides for full and final settlement of all claims against the employer and money due to the employee.
Contact us today if you are an employee who needs a solicitor to review and sign your settlement agreement. We offer telephone or zoom consultations to avoid the need for travel in these COVID times and can help you wherever you are located.