A settlement agreement is a written agreement where an employee accepts financial compensation in return for agreeing not to bring any claims against their employer. It is only valid if the employee receives independent legal advice on the settlement agreement.
A business may use a settlement agreement if they want to avoid the risks of dismissing someone or they do not want to go through a full dismissal process.
Due to the strict statutory requirements, it is important that you instruct an employment lawyer to ensure that the settlement agreement is legally compliant. If the agreement fails to comply with the legislation, the waiver within that agreement will be void for certain claims, meaning the ex-employee could still bring certain claims against the business.
Our experts have extensive experience in drafting, advising on and negotiating the terms of settlement agreements. Our in-depth knowledge means we can advise you on the most pragmatic and commercially sound way to terminate employees, so you can focus your time on running your business.