Settlement agreement

About this document

If you want your employee to agree to contract out of the right to make a claim before an employment tribunal, you can do so in very limited ways and subject to strict criteria. Unless you use the right document, your agreement will not qualify.

This agreement includes the legal provisions to “qualify” a compromise agreement so as to prevent a later claim before an employment tribunal. It is drawn primarily with a view to settling a claim by a more expensive employee. The agreement can however, be used with the same effect for a case involving a more junior staff member.

If a senior employee has been employed under a service contract which does little to protect the company, this document will go some way to repairing the damage by imposing “usual” provisions as a fair exchange for the money you will offer.

Many professional advisers overlook the necessity for the employee to have a prospective or actual claim. In most cases it will be necessary to have terminated the employment before this type of agreement can be used to any effect. However, that is not to say “without prejudice” negotiations cannot take place in the knowledge that a termination is proposed.

Application and features

• Drawn to comply with the Workmen’s Compensation Act, 1923;
• Suitable for any employee whose employment has been terminated, who wishes to negotiate terms for settlement of claims;
• Suitable for an employer in any organisation wishing to agree terms for termination of employment;
• Drawn to settle very large claims with senior staff, but suitable, with deletions, for junior staff;
• Prevents later application to employment tribunal;
• Covers court claims too;
• Extensive notes to guide you;
• Plain English - of course!.

Contents

• Continuation of employment for fixed period until the “termination date” - as short or long a period as you wish;
• Extent of continuing entitlement to pay and benefits;
• Return of organisation's property;
• Return of car;
• Guarding secrets and information;
• The compensation package;
• Restrictions on future competition by the ex-employee;
• Press release and publicity;
• Usual legal provisions to protect your interests.