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Russell Brown Comments on ‘Settlement Agreements’ in ‘Ask the Expert’

Comments from Russell Brown, partner and head of employment at Glaisyers Solicitors LLP for Joanne O’Connell at Settlements Agreements.co.uk for its ‘Ask the Expert’ feature

Q: I’ve been offered a settlement agreement but I don’t think it’s a fair offer. What should I do?

A: If you have been offered a settlement agreement by your employer you will need to take advice from a solicitor for the agreement to be binding. Your solicitor can talk you through the terms of the agreement and assess the fairness of any offer made to you. If your solicitor feels the offer is unfair they can approach your employer to open up negotiations on your behalf.

In terms of assessing the fairness of an offer, this will very much depend on whether your employer has grounds on which to dismiss you.

If they do, it may be the offer on the table is fair, subject to a number of factors, namely:

  • Negotiation on some additional benefits you may be able to secure from your employer (see below)
  • Confirmation that you are receiving the contractual payments you are entitled to for example holiday pay / bonus / commission payments
  • Notice period.

If your employer does not have grounds to dismiss you then the fairness of any offer will depend on the merits and potential value of any claim you may have against them such as an unfair dismissal claim.

In order to assess the value of any claim, you would need to consider how long it is likely to take you to get another job on a similar salary as damages for loss of earnings are likely to make up a large part of any claim. As you will appreciate, if you have a new job in the pipeline your losses would be limited which may make any offer more attractive. However, if you believe it is likely to take you several months to find another job, the offer may appear much less appealing.

In terms of additional benefits, it may be possible to get your employer to agree to other changes aside from, or in addition to, an increase in financial compensation. In this regard, your solicitor may be able to help make any payments you receive more tax efficient to maximise the amount you are recovering from your employer. Likewise, whilst most employers will make a contribution to your legal costs, there is often scope to secure an increase in this figure. In addition to this, your employer may also agree to provide a reference with a clause in the agreement that they will not derogate from it.