A settlement agreement is a legal contract issued by an employer and sets out the key terms and conditions to end a relationship or resolve a dispute with an employee. The employee will usually be awarded a sum of money for signing the agreement.
[Editor’s note: For some of the best settlement agreement lawyers in Scotland click here; for best settlement agreement lawyers in England click here; for some of the top employment lawyers in Wales click here; and for some of the best Settlement Agreement Lawyers in Ireland click here. For great employment lawyers in the US see here; and for fantastic employment lawyers in Australia see here.]
Being presented with a settlement agreement can be daunting, especially if you’ve not received one before; making sure you get a fair deal is paramount. In this guide, we walk you through some top tips for signing a settlement agreement.
1) Appoint a specialist
It is a requirement to get legal advice before signing a settlement agreement, but the cost of doing so will usually be covered by your employer.
Hiring a settlement agreement solicitor also allows you to fully understand the terms and any risks or complications associated with the offer.
2) Avoid handing in your resignation
Avoid resigning until you have sought legal advice – this could weaken your negotiating position.
3) Don’t be afraid to negotiate
Remember that you do have the right to negotiate a settlement agreement to make sure you secure terms you are happy with; any negotiations are confidential. Specialist lawyers will also be able to advise you on any changes that could be made to make the agreement more favourable to you.
4) Consider what your employer wants
It can be helpful in these situations to consider what your employer will want; they will likely be keen to achieve a fast, easy and uncomplicated exit and they will want to keep business affairs confidential. You employer will also hope to avoid an employment tribunal.
5) Factor in what is important to you
Before you begin to negotiate, step back and consider what’s important to you and talk to your solicitor to discuss your requirements and make sure the agreement meets those and doesn’t leave you in an unfavourable situation.
Be realistic – make sure your main goals are covered but avoid seeking a settlement that is in excess of what you might get from a tribunal as this is unlikely to bring about a successful outcome.
6) Understand the legalities involved
Remember that by signing a settlement agreement, you waiver your rights to a tribunal or raising a claim against your employer.
Your solicitor will be able to walk you through any other rights or legal elements that you should be aware of.
7) Consider requesting a reference
You can expect to receive a reference for a new job from your employer, but it can be beneficial to write this into the agreement during negotiations.
Thompsons Solicitors has a team of employment law lawyers who specialise in dealing with settlement agreements. You can contact them for advice on 0800 0 224 224.
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