What is a settlement agreement? Employment Law
Settlement agreements used to be known as compromise agreements. They bring your employment to an end on mutually agreed terms, often involving payment of compensation to you by your employer on the understanding that you won’t bring any claims against them.
Here are our top five tips on settlement agreements:
- Without independent legal advice the agreement will not be binding.
- The payment you receive may be subject to tax; normally the first £30k is tax free.
- Don’t tell everyone about your agreement. It is almost always a term of the agreement that you don’t discuss the existence of it or the terms.
- If you believe you have a claim against your employer, really think before you sign, there is no going back.
- Employers often pay for, or contribute to the costs for your legal advice – so there is no cost to you!
Employment Law