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Settlement Agreements – North Northants and Warwickshire

Reasons to choose Wilson Browne

If you require an Employment Solicitor in Daventry, Rugby, Lutterworth, Southam, Brackley or Silverstone to advise on the terms a Settlement Agreement, we can provide you with the expert assistance you are looking for.

The North West part of Northamptonshire and the Warwickshire border can lay claim to a surprising amount of industry. From the logistics parks situated in the north of the county, such as DIRFT, Magna Park and increasingly Daventry, to the specialist industries located in and around Brackley and Towcester, it’s inevitable that where there are employers and employees relationships will sometime break down.

What's included?

  1. A review of the documentation ahead of the call and calculating entitlements etc.
  2. A detailed advice call when we go through:
    • the background to how the agreement came about so we can advise on any claims you may have – from this you (and we) can then make a proper assessment of the sum on offer and whether it’s a good deal
    • the alternatives – together with the pros and cons of those alternatives
    • what the settlement agreement means and any changes we recommend
  3. A detailed advice letter confirming the key areas of advice given during the call and which clearly sets out the changes. This is designed to enable the client to have sufficient information to negotiate if they wish to do so themselves.

A Settlement Agreement (formerly known as a compromise agreement) is a legally binding agreement between an employer and an employee. Commonly, under the terms of the agreement, the employee agrees not to pursue a potential claim against their employer or former employer, in return for financial compensation. However, a settlement agreement will not be legally binding unless the employee obtains independent legal advice prior to signing.

At Wilson Browne Solicitors our expert employment team regularly advises individuals on the terms of their settlement agreements, ensuring that the Agreement is binding and that they get the best possible deal. We try to make the process as easy as possible for you and we can provide the advice either over the telephone or at one of our offices in Northampton, Kettering, Corby, Higham Ferrers, Wellingborough and Leicester.

Our team also understands that, when a settlement agreement has been offered, the relationship between the employer and employee has often broken down or become strained. If that is the case, we will assist by liaising directly with your employer on your behalf, minimising the contact you have with them. Where necessary, we can also conduct negotiations on your behalf to help achieve the best possible settlement for you.

In terms of costs, in the majority of cases the employer will provide a provision for legal costs as part of the settlement agreement we shall work to that provision, wherever possible.

Please view our guide on settlement agreements for further information.

For further advice or information  please contact the Employment team on 088 088 6004.

Other sources of information: ACAS.

In simple terms, for an agreed sum, you and the employer agree to go your separate ways in return for a consideration (payment) made to you. The settlement agreement is binding and invariably means you give up any right to pursue any further claim in the future and to be bound by certain terms such as (but not limited to) confidentiality and to not make any negative comments regarding the (former) employer.

Sometimes the agreement will include other things of benefit to the employee, such as an agreed reference letter.

It could be that the relationship between you and your employer has broken down or become strained. We can help ease the pain during what can be a difficult time by liaising with your employer on your behalf. This means that if you wish, we can minimise any need for you to have direct contact with them. We can’t tell you whether to accept an offer or not – only you can make that decision, but we will support you through the process and can help negotiate on the terms of the agreement if necessary.

See our full guide below to Settlement Agreements

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In what circumstances will a settlement agreement be appropriate?

An employee can make a claim against a business under both their contract of employment and under statute. These claims may arise:

  • on recruitment;
  • during employment; or
  • when their employment has been terminated.

Businesses can enter into an agreement with an employee to settle potential claims when they are still working for the business, but in most situations, their employment will have ended (or be about to end).

What are the legal requirements for a valid settlement agreement?

For a settlement agreement to be legally binding, there are a number of conditions that must be met:

  • The agreement must be in writing.
  • The agreement must relate to a particular complaint or particular proceedings.
  • The employee must have received legal advice from a relevant independent adviser (for example, a qualified lawyer or union official) and normally the employer makes a contribution towards this cost. The advice should cover:
    • the terms and effect of the proposed agreement; and
    • its effect on their ability to pursue any rights before an employment tribunal.
  • The independent adviser must have a current contract of insurance (or professional indemnity insurance) covering the risk of a claim against them by the employee for the advice.
  • The employee’s adviser must be identified.
  • The agreement must state that the conditions regulating settlement agreements have been satisfied.

Possible content of a settlement agreement

Other than the legal requirements listed above, the contents of a settlement agreement are largely at the discretion of the business and the employee involved. Examples of common clauses include:

  • Compensation for loss of employment.
  • Contribution to legal fees.
  • Waiver of claims by the employee, including warranty that the claims listed are the only claims which the employee has against the employer.
  • Re-assertion or modification of existing restrictive covenants  .
  • Indemnity from employee in relation to tax and National Insurance Contributions.

Confidential information

Protecting confidential information is usually crucial to a business and therefore settlement agreements often contain confidentiality provisions, for example, the employee agrees:

  • Not to use any confidential information.
  • Not to disclose any confidential information to any person, company or other organisation.
  • To keep the terms and existence of the agreement confidential.
  • To not make any derogatory comments about the employer (or any individuals employed by it) to a third party.

Which types of claim can be settled by a settlement agreement?

A large number of statutory claims can be settled by a settlement agreement, for example claims for:

Which types of claim cannot be settled by a settlement agreement?

There are a number of statutory claims that cannot be settled by entering into a settlement agreement, including some types of:

Settlement agreements can be an ideal way of an employee and employer parting company under sometimes difficult circumstances but should not be entered into without proper advice.

Other sources of information: ACAS

For further advice or information  please contact the Employment team on 088 088 6004.