Redundancy and Settlement Agreements

Helping You Exit Employment on Fair Terms

Helping you to exit from your employer and resolve disputes amicably on terms that are beneficial to you.

Redundancy and settlement agreements (formerly known as compromise agreements) are commonly used by employers to resolve employment issues swiftly and effectively. They are particularly useful when managing redundancy situations and resolving any potential claims that an employee may have against their employer. Settlement agreements allow for a mutual termination of employment, providing a clean break for both parties. It is a valuable tool for managing disputes, especially when there are underlying tensions between the employer and employee.

For employers, settlement agreements offer a streamlined way to manage redundancies and potential claims, avoiding the complexities and potential costs associated with Employment Tribunals. Employees, on the other hand, can benefit from the certainty and finality that a settlement agreement provides. It’s often a preferred option as it ensures a quicker and less stressful exit from the company without the need for prolonged negotiations or potential litigation.

In some cases, entering into a settlement agreement is the best course of action. This option minimizes stress, avoids unnecessary animosity, and enables both the employer and employee to move forward more quickly. Whether it’s due to redundancy or the need to resolve a workplace dispute, a settlement agreement can offer a resolution that benefits both sides. However, it’s crucial for employees to receive independent legal advice to ensure their best interests are protected during this process.

It’s important to note that either party—the employer or the employee—can suggest a settlement agreement. However, regardless of the circumstances, employees are strongly advised to seek independent legal advice from an experienced employment lawyer before signing any agreement. This ensures the agreement is fair, legally binding, and in the employee’s best interests.

Get in Touch with Dominic Moss, Employment Solicitor

If you are considering a settlement agreement or have been offered one, we are here to help. Call us for a consultation:

• Freephone: 0800 434 6544
• Local: 01606 87 22 00
• Email: info@stonehewermoss.co.uk
• Fill in our online enquiry form to arrange your consultation.

Why Is Legal Advice Important?

Legal advice plays a crucial role in ensuring that the terms of the settlement agreement are fair, appropriate, and protect your future employment prospects. Without independent legal advice, settlement agreements are not legally valid. By obtaining expert legal guidance, you ensure that your rights are protected and that you fully understand the terms of the agreement.

When you sign a settlement agreement, you are typically waiving your right to bring any future claims against your employer. This includes claims such as personal injury claims for workplace accidents, though there are exceptions, such as claims related to industrial diseases that might not manifest until later in life. Therefore, it’s essential to understand the full scope of what you’re agreeing to.

Good news: Employers usually cover the cost of the legal advice, making it easier for you to seek expert guidance without worrying about additional fees. Having this independent legal advice ensures that the agreement is fair, that your rights are safeguarded, and that you are fully informed before signing anything.

Typically, a settlement agreement will include the following key elements:

• The specific claim being settled
• The financial payments you will receive
• Tax considerations related to the payment
• Confidentiality or non-disclosure clauses (often referred to as “gagging clauses”)
• Any agreed references from your employer, if applicable

If your employer has asked you to sign a settlement agreement, it is crucial to consult with our experienced employment solicitors. We can review the terms, explain your rights, and help you determine if the settlement agreement is in your best interests.

Cost

Our fee for reviewing and advising on a settlement agreement is typically £500.00 plus VAT. This fee covers the explanation of the agreement and the associated legal work. If the work required is more extensive, we will inform you in advance of any changes to the fee. We strive to provide clear, upfront pricing, so you can make an informed decision with confidence.

At Stonehewer Moss, we are committed to providing the highest standard of legal advice to ensure your settlement agreement is fair, legally sound, and in your best interests. Get in touch today for expert assistance with your settlement agreement or redundancy-related concerns.