What Should You Do When You Get A Settlement Agreement?

If you are given a Settlement Agreement from your boss one morning, you will have a difficult decision to make.

If you do sign it, you will no longer be employed and could potentially not have a sufficient settlement payment to sustain you for long enough to find another job.

If you refuse to sign it, you risk an unsuccessful disciplinary procedure and potentially know settlement payment at all, and no guarantee of income until your next job comes along.

No matter which you decide, it can be a very difficult time for you and your family. Before you do decide, there are several things that you should consider. It is important to know that all Settlement Agreements come with a clause that you must receive legal advice prior to signing off on them. This means that you must go and see a Solicitor prior to agreeing with your employer. If you fail to do this, then the Settlement Agreement will be void and you will not receive payment of the sum stipulated in the agreement and may still face disciplinary proceedings.

Why do I need a Settlement Agreement?

Before 2013, Settlement Agreements were known as Compromise Agreements. They were introduced as part of a wider change to employment law in the UK. These changes endeavoured to prevent employers from treating employees poorly in dispute scenarios and to ensure that employers acted ethically.

Often a Settlement Agreement will stipulate that the former employee cannot bring a claim against the employer and sometimes a confidentiality clause (gagging order) so that you do not bad mouth the company to others. Some agreements will include a reference, for example, the employer is to provide you with a reference.

For many, a Settlement Agreement, is the most amicable and appropriate way to end an employment contract. It prevents long drawn out disputes and in many circumstances, will allow you to move to another job seamlessly.

Will I know I am Being offered a Settlement Agreement?

In many circumstances, you will not know that you are being offered a Settlement Agreement. However, there are many who will enter into something called ‘pre-termination negotiations’ these are also known as ‘protected conversations’ These conversations allow for employers to have frank conversations with the employee about the termination of the Contract.

Whilst you are in this meeting, it is important to glean as much information as you can as to why this Settlement Agreement is being offered and how the severance package has been calculated.

This conversation is completely protected, and anything that is said in this cannot be used by either party in an unfair dismissal claim. There are exceptions to this, for example in discrimination cases and whistleblowing cases.

What Should I Do?

When you are offered a Settlement Agreement, you may be directed to a Solicitor by the company that you work for. Whilst this may be the easiest option, you do have the choice to choose whichever Solicitor you would like.

At Seatons, we offer a free, no obligation chat with one of our friendly team who will be able to tell you the next steps. We pride ourselves on being the ‘friendly professionals’. We also offer a fast service which will leave you with peace of mind and the ability to get on with things.

The legal costs are usually provided by the company, however, we will let you know if they are not. At Seatons we offer low, and fair fees and will always keep you updated with the costs.

We understand that this can be a difficult time for you and your family. We endeavour to be supportive, friendly and most importantly use our expertise to ensure that you get the result you deserve. For a free, no obligation chat, please call us today on 0800 310 11 12.

Latest Settlement Agreement Video
Micaila Williams – Employment Law – Seatons Solicitors

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