A settlement agreement (or a compromise agreement, as they were formerly known) is a legal agreement between you (an employee) and your employer to settle an employment dispute without going before an employment tribunal.

You will often be offered a sum of money (a settlement) in exchange for giving up your right to a legal claim. You may also receive some non-financial benefits as part of your settlement.

Understandably, employees will be concerned about waiving their legal right to a claim, and may not understand whether the settlement they are being offered is fair.

That is why the Dispute Resolution team at Attwaters Jameson Hill is here.

Our lawyers can analyse your settlement agreement and negotiate on your behalf to ensure you leave your employment with a settlement that is fair and representative of what you are entitled to.

What are the benefits of settlement agreements?

  • It can be less stressful than going through the employment tribunal process
  • With a settlement agreement, you are certain of receiving something; if you take your case before a tribunal, it may be dismissed
  • There are significant tax benefits to settlement sums, which are tax-free up to £30,000
  • Your employer will often agree to provide a reference as part of a settlement agreement

What are the disadvantages of settlement agreements?

  • You will give up your right to see any action taken or justice served
  • A settlement agreement will usually contain a confidentiality clause to prevent you discussing it with anybody, which can be damaging to your mental health
  • A settlement agreement may not offer the amount you could win in compensation if you were to win your case at an employment tribunal

How we can help

With the various pros and cons and the inevitable stress of being in the middle of a dispute with your employer, it can be easy to feel overwhelmed.

Our Dispute Resolution lawyers can help you find the best way forward, helping you resolve your claim fairly and with as minimal additional hostility as possible.

We can:

  • Review your settlement agreement
  • Provide specialist legal advice on the terms of your settlement agreement and support you in negotiations with your employer
  • Offer further enforcement support should you experience any issues with receiving your payment

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