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 in all industries and sectors.
We have dealt with a lot of settlement agreements offered to banking and financial services employees, City workers generally and executives with complex remuneration packages such as stock options and bonuses.
We offer a fast, often same day service and will review your settlement agreement and explain if the compensation offered is of an acceptable amount or could be improved.
Our employment lawyers have the experience to resolve related issues surrounding tax, share incentives, bonus payments, commissions and references.
Settlement agreement costs
Usually your legal fees for our review are paid by your employer. Please do call us to discuss your position. We are always happy to scope a case for you.
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 you should consider.
Key points on settlement agreements
- Must be mutually agreed – you cannot be forced to sign a settlement agreement.
- Redundancy? – 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 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 – there is no fixed amount an employer will offer but the minimum is your contractual entitlements and typical ex-gratia compensation will be 2-3 months extra salary equivalent.
- What types of claims, if any, could you bring against the employer if you reject the settlement agreement? – what are the prospects of success?
- 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 the agreement or are unrealistic in seeking to negotiate more money.
- Restrictive covenants post termination of employment
- Tax issues – if the settlement agreement is not drafted properly you may be paying extra tax and tax payable on payments made on termination of employment is not always straightforward.
- 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.
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 is tax free.
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 en employee who needs a solicitor for your settlement agreement, especially if you are in Central London.