A Settlement Agreement is a legally binding contract between an employer and employee whereby an employee waives rights to make certain claims in exchange for financial compensation.
An employer usually agrees to pay a sum of money to ensure that the employment relationship can terminate without any worries about future claims.
Settlement Agreements can be used either when there are existing grievances/claims or to terminate an employee’s employment.
A settlement agreement will usually contain standard clauses such as the requirement for an employee to return any property, to keep the agreement confidential and other warranties such as not to make any derogatory comments about the other party. A Settlement Agreement can also include an agreed reference.
A Settlement Agreement is not binding until it has been signed by all parties.
Further, the employee must receive independent legal advice on the terms and effects of the Settlement Agreement from an independent Solicitor or similar.
It is important to be aware that there are a number of claims that cannot be waived via a settlement agreement. The solicitor will be able to advise on these points.
If you want to discuss how we can assist you, then please give Rebecca Hughes a call on 01553 667279.
This article aims to supply general information, but it is not intended to constitute advice. Every effort is made to ensure that the law referred to is correct at the date of publication and to avoid any statement which may mislead. However, no duty of care is assumed to any person and no liability is accepted for any omission or inaccuracy. Always seek our specific advice.
