A settlement agreement is a contract which is normally used to record the terms of a person’s departure from their employer. It is a key part of the exit procedure. Legal guidance from an independent solicitor needs to be obtained in order for the agreement to be binding. We are highly experience at working with both employers and employees to make sure the agreement is suitable for the situation.
Employer Settlement Agreements
When a dispute arises leading to an employee’s departure, an effective settlement agreement needs to be put in place between the company and employee. These agreements will contain a number of important clauses including those aimed at preventing unfair competition once an employee has left; avoiding adverse publicity; structuring payments in a tax efficient manner; preserving confidentiality; ensuring the return of property; and others.
If you need advice on the drafting of a settlement agreement or are thinking about asking a member of staff to sign one, please get in touch by visiting our Settlement Agreements for Business page.
Employee Settlement Agreements
If your employer has approached you with a settlement agreement, we can help you determine if the terms are in order and if it is in your best interest to sign. There are a number of questions that need to be asked before the document is signed. These can include - Is there provision for a reference to be provided? Is the Termination Payment sufficient or should it be increased? Is the payment structured in a tax efficient way? Does the agreement attempt to restrict an employee from working for a competitor? Just to name a few.
If you have been asked to sign a settlement or compromise agreement by your employer, contact us for more information on how we can help by visiting our Settlement Agreements for Employees page.