Fair & Legal Settlement Agreements

A settlement agreement (formerly known as a compromise agreement) is a legally binding contract entered into voluntarily between an employer and employee to waive an individual’s rights to make a claim covered by the agreement in an employment tribunal.

Why would I need a settlement agreement?

There are many reasons why a settlement agreement might be entered into. The employer/employee relationship may have broken down and both parties wish to conclude matters by entering into a legally binding agreement which concludes matters without any further risk. Or it may be a simple case of a redundancy is occurring and both parties agree to bypass any lengthy legal process by entering into a settlement agreement and finalising the termination of employment legitimately. 

Whatever, the reason, a settlement agreement will always involve the mutual agreement of both parties and there will usually be a financial settlement as well as other non-financial benefits included in the contract.

The employee will always be required to seek independent legal advice to ensure that they fully understand the agreement they are entering into and the employer will usually pay a contribution towards the cost of legal fees.

Settlement Agreement A

Client A felt she was being bullied at work by a senior manager and had lodged a grievance against the manager, however, she did not feel that the employer had taken appropriate action but she was unsure where she stood legally especially as she has been approached by her employer to enter into a Settlement Agreement due to the working relationship having broken down.

Our expert solicitors undertook a fact-finding expedition with the client and discovered that she had a strong claim against her employer for unfair dismissal and that the employer had failed to undertake a grievance procedure properly which may result in an uplift at Tribunal.

We entered negotiations on behalf of our client and were able to secure the Settlement Agreement on more favourable terms for her including additional compensation for the failure to follow the grievance procedure.

Settlement Agreement B

Client B came to us because they were unfortunately needing to make redundancies across their business and wished to offer a number of employees redundancy on a voluntary basis and wondered if they could do so via a settlement agreement.

We advised our client of the statutory minimum requirements for making employees redundant and we also discussed incorporating uplifts and the tax effects of the settlement agreement in addition to providing advice on how the agreement worked.

The client was assured by our expert legal advice and we were with them every step of the way in implementing the voluntary redundancy process and providing a settlement agreement with terms suited to their business needs which their employees were happy to accept.

We can help if you are

  • An employer requiring the drafting of a settlement agreement with terms tailored to the needs of your business and the circumstances between you and your employee

  • An employee in need of legal advice in accordance with the statutory requirements enabling you to enter into a settlement agreement

Our highly experienced team are on hand to direct and assist you in concluding the matter without the need for resorting to legal action.

Get in touch to discuss your needs

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We have a comprehensive range of payroll, pension and legal services to help you save time. Speak to our highly experienced and friendly team to get started.

Need more help?

Contact us about your payroll or legal needs

We have a comprehensive range of payroll, pension and legal services to help you save time. Speak to our highly experienced and friendly team to get started.

About PC Payroll & Legal

PC Payroll & Legal was established in 2011. We help families stay legal and save time with our nanny payroll, pension and legal services. We help small business owners and the self-employed focus on running their businesses by offering outsourced payroll, workplace pension administration, business administration, HR advice and legal services. 

PC Payroll & Legal is part of the Working Life Solutions Group of companies. The Working Life Solutions Group includes Your Employee Wellbeing which offers wellbeing support programmes for businesses of all sizes.

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