A settlement contract, refers to a legally binding agreement capable of ending an employment contract. It is based on terms agreed upon by the involved parties. It is always advisable to get in touch with an agreement specialist when you have questions about your settlement agreement. The solicitors will do their best to provide advice on a settlement agreement and ensure you get the best settlement.
Legally, you employer will ensure you specialist advice on these agreements before you can proceed to sign any documentation. Often your employer pays for this advice. Your consultation with the specialist doesn’t have to take place in person, you can also conduct it over the phone, depending on what you prefer. Make sure to hire a specialist if an employer has offered you a settlement agreement.
How Can a Settlement Agreement Solicitor Offer Assistance to a Client?
Settlement agreement solicitors are specialized in this area of the law, and their roles include providing clients with legal advice every week. It doesn’t matter whether you’re a professional sports player, a director at a company, a private-sector worker, or a public worker, the advice our specialists impact to their clients can be of great benefit any employee.
Depending on the circumstances involved, some clients come to us for assistance in not only advising on the terms involved but also for help in negotiating better settlement terms.
Having worked on these types of agreements for decades, we understand that there may be some urgency attached to signing the agreement. For this reason, we will do all we can to schedule an appointment for the client at the most opportune time and remotely where required. Urgent cases tend to get prioritized with the meeting taking place on the same day or the next day.
Is It Possible to Approach My Employer and Request for a Settlement Agreement?
Yes, no one says you need to wait for the employer to make the first move where settlement agreements are concerned. You can also make the initial approach.
It is our understanding that disputes are unfortunately expected at the workplace, and in some cases, it may not always prove easy for the employee to raise their grievances.
Some of the clients who have come to us with such problems wanted us to assist them in negotiating an amicable exit. During the negotiations, the client may want to receive compensation because they have a legitimate claim arising from their time in the company.
A Settlement Agreement—What Is It?
Previously, the settlement agreement was called a ‘compromise agreement’ but is today known as a ‘redundancy’ or ‘severance agreement’.
Put simply; the settlement agreement is a legal document prohibiting company employees from taking their employers to court. It’s something that happens when the employee is offered a lump sum of money with the sole aim of ensuring they will not sue the employing party or bring specific claims forward.
When the employee signs the agreement, it means they’re no longer in a position to take the employer to an employment tribunal. It also implies they can’t advance any legal claim included in their agreement.
The employee will need to seek independent legal advice for the agreement to become legally binding. Our specialist legal team is more than happy to offer you the counsel you need and also guidance on how to go about completing the process.
For any settlement agreement to be deemed as legally binding, it needs to fulfill several requirements such as:
- Any agreement entered into should be in writing.
- The employee signing the agreement must have consulted an independent solicitor.
- The settlement agreement must have a relation to a given complaint(s) or proceeding(s).
- After receiving advice, the employee must sign the agreement.
- The settlement agreement must state in writing that it has fully met all the requirements used to regulate settlement agreements.
Legal Advice
Before any settlement agreement can get signed, the employee will first need to seek legal advice from an independent specialist. The employment solicitor must offer advice to the employee on legal claims that are likely to arise. As such, the employee should ensure they have fully understood all pertinent legal matters and the worth of all potential claims.
Under UK law, all employees are accorded certain rights. Any person seeking to validate a settlement agreement should begin by getting legal advice from an independent advisor. By doing this, they’ll ensure that their legal rights are fully protected. It’s a confirmation that they’re aware of their rights and fully appreciate them.
Employee rights accorded by UK laws tend to fall under three categories:
- Statutory Rights: Resulting from the UK statute. Therefore, any legal claims that may arise from this statute must be followed in an Employment Tribunal. The rights are meant to protect employees from numerous things such as:
- Receiving paternity and maternity rights.
- Unfair dismissal.
- Paid the minimum wage.
- Receive a statutory redundancy payment.
- Not to get discriminated by the employer based on age, marital status, trade union membership, gender, religion, disability, racial origin, national origin, and sexual orientation.
- Not to experience unauthorized wage deductions.
- Common-Law Rights: Laws falling under this classification are derived from general laws and pertain to how an employer treats you. Some of the aspects covered by these laws include personal injury, defamation, and negligence. Any legal claims falling under this category must go through the County Court or the High Court.
III. Contractual Rights: All rights under this category are those explicitly set out in the employment contract. They state the amount you will receive as your salary, your holiday entitlement, and your job title. Furthermore, they will also communicate additional benefits you’re set to receive and your overall notice period.
While the above three categories generally cover what’s included in the settlement agreement, it’s not uncommon to find the rights overlapping. Moreover, some employee categories may also come with a set of different or additional rights. You, therefore, need to seek legal advice to confirm all your rights are protected. The advice will also prove where your rights fall.
When an employee doesn’t receive sound legal advice, they run the risk of either waiving or signing away all their rights by entering into an agreement they don’t wholly comprehend. Keeping this in mind, employees are urged to seek expert advice to make sure they get to protect themselves from employers with ill intentions.
For an employee to sign away or waive their statutory rights, they will either have agreed to:
- Sign a COT3, which is also known as an ACAS settlement, after the commencement of legal proceedings.
- Append their signature to a legal settlement agreement after receiving advice from a lawyer or a trade union adviser.
Settlement Agreement Benefits
For an employer, having a settlement agreement is beneficial in that they’re assured the employee will take the settlement offered and that he/she will not seek legal redress. To an employee, the settlement agreement is an assurance they’ll receive the agreed amount as long as they settle the pending claims.
When clients come to us for help, our solicitors get to assist them by:
- Engaging in legal negotiations on their behalf.
- Providing advice on whether there are any legal claims that may come about due to employment termination.
- Providing a detailed explanation of the agreement at hand, as well as offering additional advice on whether there’s a need to make any changes or amendments to it.
- Where a claim may arise from terminating your employment, you will also receive advice on what these claims are worth to you.
- The specialist will also go ahead and inform you whether the compensation offered by the claim(s) is reasonable based on the situation at hand.
Why Hire a Solicitor?
The leading reason why you need to find yourself a solicitor is because of the formal language employed in drafting them. It may refer to various Regulations and Acts you haven’t familiarized yourself with or are yet to come across. Thus, you need to ensure you’re well-versed with what your agreement states.
Legally, each employee is expected to seek professional advice to help them understand what each agreement implies. The specialist adviser is also legally required to sign this document as a confirmation that they have offered the advice their client needed.
According to the terms of the Dispute Resolution (Employment Rights) Act of 1998, the only person allowed to offer advice on settlement agreement is a qualified lawyer. Others deemed qualified by the act include a skilled center worker and a qualified trade union official. If all those mentioned above are to offer advice, they must be covered by indemnity insurance.
Will You Have to Pay for this Advice from the Specialist?
Often the advice is free to you as the employee. Traditionally, the cost of the advice offered when dealing with settlement agreements gets covered by the employer. As such, this means you don’t have to pay anything from out of pocket for the advice offered to you.
What’s the Next Step?
If an employer has offered to give you a settlement agreement, and you’re interested in going through it with us, please make sure to call our offices immediately. Alternatively, you can also complete the inquiry form on our website, and a solicitor will call you back within 24 hours. We make it our job to arm you with all the information you need to complete this process.
Settlement Agreement Expenses
As mentioned above, the first thing you will need to do after receiving a settlement agreement is to seek professional legal advice from an insured solicitor. It’s highly important you do this, as you will waive away your rights as soon as you agree to the agreement and append your signature to it.
You can’t, therefore, take the employer to the employment tribunal or court. Furthermore, it means that you won’t have an option to renegotiate the amount the employer has offered you. It’s what makes it all the more important to seek legal advice. Most of the people who don’t seek advice are those who are afraid of the costs that may result from this process.
But, what they fail to comprehend is that regardless of the amount offered for the settlement agreement, the employer is legally required to contribute towards your legal costs. However, you may want to inquire about how much support the employer will offer, as there may be a limit.
Legal Costs for the Settlement Agreement
How Much Will the Settlement Agreement Cost?
At our law firm, we have experienced and dedicated individuals who are ready to offer legal advice on such agreements at a moment’s notice. Our team understands the need to observe confidentiality and will take you through the agreement step by step. Our solicitiors will also communicate the amounts offered by the employer for this advice.
It’s not uncommon for you to come across terms you don’t know when going through a settlement agreement presented to you at work. For help with some of these terms, feel free to visit our glossary list to take a look at their meanings. We have done our best to include all the terms commonly used in these legal contracts and their corresponding definitions.
As always, we strongly urge you to get in touch with our team of professional solicitors to go through any questions you may have regarding settlement agreement fees.
Settlement Agreement FAQs
1. What’s the Meaning of a “Protected Conversation?”
The “protected conversation” enables the employer and employee to engage in confidential pre-termination settlement talks. Whatever the two parties agree or discuss in these talks can’t be used against either party in any resultant unfair dismissal proceeding.
But then again, this protection is only extended to regular unfair dismissal claims, and not on other claims such as discrimination at the workplace. Moreover, an employer automatically losses their “protected conversation” rights when they decide to engage in improper behavior during the talks.
Improper behavior will, in this case, include unfairly placing extra pressure on the employee to sign the agreement.
2. How Much Time Do You Have to Make a Decision Regarding the Settlement Agreement?
Many of our clients want to know how much time they have before deciding whether to sign the settlement agreement or refuse it. Employers, according to the guidelines given by ACAS, should allow their employees a minimum of ten days to decide on whether to sign the settlement agreement.
The employer shouldn’t ask an employee to sign the agreement immediately. If they do this, the employee can report it as undue pressure and state that the other party acted improperly.
3. What Is Seen as a Fair Settlement Offer?
The answer to this question is dependent on the circumstances that led to the Settlement Agreement getting offered. Our team will seek to understand this by inquiring about its background to determine the kind of claims you’re likely to have against the employer. From this background, the team will then advise you on what’s fair based on their evaluation.
It’s a process that seeks to establish whether the terms offered to you sufficiently compensate for all the rights you will waive. Another factor considered when it comes to accepting an offer is the length of time it may take to get another job. Remember that any compensation given to you by the Employment Tribunal is based on how much you will lose.
4. Can I Tell Others About this Agreement?
Almost all Settlement Agreements will come with a typical confidentiality agreement; in some cases, the confidentiality clause will only prevent you from discussing the amounts offered. However, there are other instances when it will include discussing the existence of such an agreement with anyone.
In the latter case, you’re legally prevented from discussing the issues that caused you to terminate the employment contract. It is, however, possible to ask for exceptions to this rule so that it doesn’t cover your professional advisers, spouse, and immediate family.
When others learn about your claim or dispute with your employer, you will need to determine the kind of confidentiality agreement offered to determine what’s appropriate for discussion.
For a no obligation discussion with one of our employment solicitors click here.