So your employer has offered you a settlement agreement (they’re known as compromise agreements in Northern Ireland). But should you accept? 
Your answer depends on a variety of factors.
Typically, you’ll be offered a settlement agreement because your job is being made redundant, or because your employer is unhappy with your work and wants you to leave.
The settlement is a pay-off that you receive in return for losing your job and agreeing not to bring a claim against your employer.
Despite what your employer says, you should not feel under pressure to accept the first deal they offer you.
Protected conversations
Before you reach a settlement, you might have a meeting or series of meetings known as ‘protected conversations’ – this is where you talk to your employer in confidence about your contract being terminated.
Nothing that is said in these meetings can be used in a later unfair dismissal claim (unless one of the parties behaves badly during the process, or it’s a case of discrimination or whistleblowing, or when your dismissal counts as ‘automatically unfair’ in law).
It’s important to write down everything that is said in these meetings, as they can be stressful and the details may be difficult to remember. Your notes will be useful if you ever have to give evidence later.
Settlement agreements
Any settlement agreement is legally binding, which means you can’t change your mind after you’ve signed it.
The agreement will include details of the amount you’ll be paid (and the tax implications, if any), as well as other issues such as:
- Agreement that you won’t bring a claim against your employer in future
- Confidentiality clause meaning you can’t badmouth your employer or tell anyone about the settlement you reached
- Restrictive covenants, for example, stating that you won’t work for a competitor for a certain period of time
- A good reference if your employer has agreed to give one
See a solicitor
For any settlement agreement to be binding, you must take legal advice from an independent professional who specialises in such matters – that’s us!
Don’t worry, your employer should pay our fee.
We’ll hold your hand along the way, helping you decide whether they’ve offered you a good deal. We also help with negotiations, to ensure you get the pay-out and other benefits you’re entitled to.
We’ll also advise whether you could bring a discrimination or unfair dismissal claim against your employer – but you’ll have to act quickly, because you have to do this within three months less one day from the date you were dismissed.
We know the prospect of losing your job can be scary, as can negotiating with your employer and their lawyers, not to mention the thought of facing an employment tribunal. But we deal with this situation all the time and have loads of case studies where we’ve achieved successful results for our clients.
If you have any queries, just give us a call.
Need help?
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We have already helped thousands of people to win millions of pounds in compensation.
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