Employment Settlement Agreements

Settlement Agreements under the Employment Rights Act are useful documents for both employers and employees as they make it possible for employment disputes to come to an end amicably.

Our Employment lawyers regularly draft Settlement Agreements for employers ranging from small businesses to multinational companies dealing with junior employees and senior executives.

Typically, when an Employment Settlement Agreement is entered into, the employee will receive a sum of money for compensation for loss of office or a gift on termination (which may comprise of notice pay, holiday pay and perhaps a tax-free ex gratia payment) and a reference. Meanwhile the employer will, through the Settlement Agreement, ensure that it does not have to face any claims from the employee and that the employee will agree to such terms so as to protect the employer after the employment is at an end regarding company clients and other company property.

In terms of advising an employee, our Employment lawyers will ensure that the employee fully understands their employment rights that they are compromising and whether the compensation payment proposed will be sufficient for such a compromise. If the compensation is insufficient we will negotiate directly with the employer to achieve the best result.

We can also advise on share sales and options to purchase as well as the tax implications of the contractual and compensatory payments. We will make the parties fully aware of the ongoing obligations after execution of the agreement, for example restrictions on future employment and confidentiality provisions.