mitchell wilde solicitors beeston, nottingham and derby

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Employment Settlement Agreements

If your employment is coming to an end, your employer might offer to pay you a sum of money but want you to sign an “Employment Settlement Agreement”.

This typically happens if you are accepting voluntary redundancy, or if there has been    some sort of disagreement, and you and your employer want to agree terms and go your separate ways.

Why?

Unless there is a special agreement, under Employment Rights Act 1996, countersigned by your solicitor (or sometimes a trade union officer), you can still make claims against your employer even after that have given you a “golden handshake”.  The settlement agreement is intended to close off those claims.

It should be written so as not to affect any pensions rights you have accrued and may or may not prevent you making claims for any industrial injuries.

It often has other things in as well, for example:

  1. Release of Claims: You agree to give up the right to pursue any further legal action against the employer concerning specific issues covered in the agreement.
  2. Confidentiality: You and your employer often agree to keep the terms of the settlement confidential, although you will generally be allowed to tell your immediate family, HMRC and so on.
  3. Non-Disparagement: Both parties agree not to say or publish unkind or untrue things about each other.
  4. Monetary Compensation: The agreement may include a payment to you, which could be a lump sum or a structured payment.
  5. References: It may say what reference your employer will give you, to anyone who asks for one. Often these are short and factual, saying the dates your employment started and ended, and what your job title was, but not commenting on your performance.
  6. No Admission of Liability: Usually no-one admits any wrongdoing or liability.
  7. Return of Property: You will usually have to return any company property.

Because the agreement is only legally binding if you have had legal advice and it is countersigned by your solicitor, your employer will agree to pay a part (and almost always the whole) of your legal fees.

Getting Employment Settlement Agreements signed tends to be time sensitive.  Telling you just what they contain, and helping you decide whether it was what you were expecting and whether you want to sign it, we can see you and complete them very quickly.


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