What to do after receiving your Settlement Agreement

Employment Law specialist Lee Jefcott from Brabners LLP, joins Muj Choudhury for a discussion about negotiating your Settlement Agreement - what to look out for and when to seek legal advice.

Facing redundancy can be a challenging experience, both emotionally and professionally. During this time, employers may offer a settlement agreement as a means to terminate the employment relationship.

What is a Settlement Agreement?

A settlement agreement, also known as a compromise agreement, is a legally binding document that outlines the terms and conditions agreed upon by both the employer and employee when terminating the employment contract. It is typically offered in redundancy situations to resolve any potential disputes and provide clarity on the financial settlement.

Key Elements of a Settlement Agreement:

a. Termination of Employment: The agreement will specify the date of termination and confirm that the employee will be made redundant.

b. Financial Compensation: Details regarding the amount of compensation, redundancy pay, and any additional benefits or entitlements will be outlined.

c. Confidentiality: Both parties agree to keep the terms and existence of the settlement agreement confidential.

d. Waiver of Legal Claims: The employee typically agrees to waive any potential claims against the employer, ensuring a clean break.

e. Employment References: The agreement may include provisions regarding the content and provision of references for future job applications.

f. Non-Competition or Non-Solicitation Clauses: In some cases, the agreement may include restrictions on the employee's ability to compete with or solicit clients from the former employer.

g. Legal Advice: It is a legal requirement for employees to seek independent legal advice before signing the settlement agreement. If you would like to seek help from Lee and Brabners LLP, get in touch here: https://www.rocketphone.ai/layoff-help

Importance of Seeking Legal Advice:

Obtaining independent legal advice is essential when presented with a settlement agreement. A qualified employment solicitor can review the terms, explain the implications, and ensure that your rights and interests are protected. They will also assess whether the proposed settlement is fair and reasonable given the circumstances of your redundancy.

Considerations Before Signing:

Before signing a settlement agreement, it is crucial to carefully consider the terms and seek clarification on any ambiguous or unclear provisions. Evaluate the financial offer, review the non-financial terms, and assess the impact on your future employment prospects.