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Home / Expertise / Employment and business immigration / Settlement Agreement Solicitors

Settlement Agreement Solicitors

What is a settlement agreement?

Settlement agreements are legally binding contracts between employers and employees. These are usually used when terminating someone's employment or to resolve an ongoing disagreement.

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Settlement agreement process

Settlement agreements are used to ensure a clean break at the end of an individual's employment. During this process, employers are encouraged to have ‘protected conversations’ or a ‘without prejudice’ discussion. This ensures that anything relating to the pre-termination negotiations won’t be admissible in the proceedings. 

When entering into a settlement agreement, the legal principles and practical implications can be complex. At the very least your employment settlement agreement should conform and comply with all formalities set out in legislation to make sure it’s legally binding. The agreement must also be in writing and the employee must receive legal advice by a qualified advisor. During this, the settlement agreement advice will look into:

  • Arrangements on termination such as payments in respect of notice and holiday
  • The agreed date of termination 
  • The date of which the termination payment is to be made and any tax treatments on this payment
  • Who will be responsible for paying the employee’s legal costs. 
  • Arrangements in respect of Company property
  • If the employee will be provided with a reference 
  • If the employee is subject to post termination restrictions 
  • The overall tax implications of the agreement. 
  • Any confidentiality obligations that both parties are subject to

 

Navigating a settlement agreement with Wright Hassall

At Wright Hassall we pride ourselves on providing our clients with the best law advice, cost effectively. We’ll support and tailor our guidance to your specific needs. 

Our employment lawyers work with employers and employees across England and Wales to resolve their employment law issues. We work with clients in a range of industries giving us the knowledge and skills needed to manage your issues. 

Get in touch with us today to see how we can help!

FAQs

  • Does a settlement agreement need to be witnessed?

    An employment settlement agreement does not need to be witnessed. Once signed by the employer and employee it becomes legally binding. However, if a settlement agreement has been prepared as a deed it will need to be witnessed.

  • Why would an employer offer a settlement agreement?

    Employers often opt for a settlement agreement when they and the employee feel the relationship is no longer working. This agreement allows for a clean break. They’re also used to reach a final agreement on a workplace dispute. It is also used to provide enhanced redundancy payments to employees.

  • Do I have to agree to a settlement agreement?

    The settlement agreement process is entirely voluntary and either party is free to decide whether they want to enter discussions or end the process altogether. You can also turn down the offer of a settlement agreement.

  • Do I need legal advice to make a settlement agreement?

    When undertaking a settlement agreement you must receive independent legal advice regarding the terms and effect of the agreement and it must be set out in writing. In the absence of this, the agreement will not be legally binding.

  • How much does a settlement agreement solicitor cost?

    Settlement agreement solicitors cost between £500 and £1,000 plus VAT, but this may vary depending on the complexity of your agreement and situation. Get in touch with us today for further help and a more accurate price.

  • What is a confidentiality clause in a settlement agreement?

    Confidentiality clauses are usually used to ensure that the employee doesn’t disclose the existence of the settlement agreement and/or any negotiations as well as the terms of the agreement. It is common for the same obligation to be placed upon an employer also.

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