If you have agreed with your employer that your employment will end, perhaps because of redundancy or work related difficulties, you may be asked to sign a Settlement Agrrement (formally known as Compromise Agreement).
A Settlement Agreement will generally offer you a sum of money as a compensation payment and by accepting the terms of the Settlement Agreement and the compensation you will waive your rights to pursue any employment related claim to an employment tribunal.
When a Settlement Agreement is signed by all parties it becomes legally binding and for this reason it is a term of the agreement that you must receive independent legal advice before signing the document.
At Dallas Legal we will go through the events which led up to the offer of the Settlement Agreement, advise you on any potential claim you may have and discuss with you whether the sum of money which is offered as compensation in the Agreement adequately compensates you for waiving your rights to pursue any potential claim.
We will then go through the document itself. It is unusual to have an agreement that does not need some amending, so if you have a Settlement Agreement that isn’t quite right, do not worry, changes can be made.
The costs relating to Settlement Agreements will depend upon how much time is spent on any negotiation and amendments that may be necessary. This can range from ten minutes to several weeks. However, in most cases the cost of legal advice will be partially or fully met by your employer.
A Settlement Agreement is commonly used when an employment contract is terminated. It is a legally binding agreement between an employer and an employee in which the employee agrees not to pursue a claim against an employer in return for financial compensation which is paid by the employer.
A Settlement Agreement will only be legally binding if the employee has taken legal advice from a ‘relevant legal adviser’ (see below) and it is normal practice for the employer to make a contribution towards the cost of taking legal advice.
A Settlement Agreement will only be legally binding if the following requirements are satisfied:
- The Settlement Agreement must be in writing
- It must relate to a specific complaint or dispute which could give rise to a legal claim in an employment tribunal or county court.
- The employee must receive legal advice from a ‘relevant independent adviser’.
- The Agreement must identify the adviser
- The relevant independent adviser must be covered by a current professional indemnity insurance policy or an indemnity for a particular body or profession.
- The Agreement must specifically state that all the requirements regulating Settlement Agreements under the Act or Acts relating to the particular complaint have been satisfied.
A ‘relevant legal adviser’ can be either a qualified lawyer, a member of a trade union who has been certified in writing as being competent to give advice or a worker at an advice center who has been certified in writing to give advice.
Dallas Legal are experienced in both the drafting of Settlement Agreements and advising private clients on the terms and implications of an Agreement.
Dallas Legal will handle your case right from the beginning until the end.
We will start by providing you informative, honest, free advice in confidence. Moving forward, we will provide legal and business consultation reviewing and structuring the case to dealing with all correspondence and advocacy at hearings (if necessary).