A settlement agreement is a legally binding contractual agreement between an employer and an employee that can be used to resolve disputes and settle specified claims an employee may have against an employer in a mutually acceptable way.
It usually involves agreeing to the termination of the employee’s employment but can be used to settle a dispute where the employee remains employed.
The agreement sets out the terms and conditions agreed between the parties. It usually provides for the employer to make an additional financial payment above any statutory or contractual rights the employee may have and/or provide other benefits, such as an agreed reference, in return for the employee entering into the agreement.
A settlement agreement can provide a quick and dignified end to an employment relationship without the need to bring a claim in the Employment Tribunal and can avoid the cost, delay, disruption and risk to employers of instigating and following dismissal procedures.
Our employment team can advise employers who are considering bringing an employment relationship to an end, from initial discussions with the employee to drafting the agreement and ensuring all legal requirements are complied with so that a valid settlement agreement is entered into.
How our settlement agreement solicitors can help:
- Our specialist employment solicitors regularly draft and advise on settlement agreements.
- As always, our employment solicitors will tailor the advice to your specific case, using the benefit of their years of experience.
- Drafting effective restrictive covenants to prevent employees from joining a competitor, interfering with supplier relationships and poaching clients and other staff