Settlement Agreement Negotiations


A Settlement Agreement is a legally binding contract between you and your employer in which you agree not to make certain claims against your employer in an Employment Tribunal or County Court in return for you receiving a financial payment and usually an agreed reference. Settlement Agreements are common in many redundancy situations, where you might have a potential claim against your employer or where it is important you and your employer remain on good terms once you have left.

Wherever you are in the UK, we will help you understand what you are signing and get you the best deal possible.


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I have been given a Settlement Agreement. Can you help me with it?

Settlement Agreements can be used to avoid a drawn out performance, disciplinary or capability process which can often be costly and time-consuming for an employer and lead to ongoing disputation for you.

It is compulsory you get independent legal advice before the Settlement Agreement becomes valid. We are experts in employment law and will advise you on the terms of the agreement in person, by email or by phone if you prefer. If it is urgent for you, we can advise at very short notice.

How long do I have before I decide to sign or not?

You may be presented with a settlement agreement by your employer completely out of the blue. This is more likely to happen where your performance is brought into question, and your employer wants to give you the option to leave under agreed terms rather than go through a performance review.

You do not have to accept the offer. You can reject it, or request a proper process is followed.

ACAS have issued a statutory Code of Practice on Settlement Agreements. It is not binding, but employers would need to justify why they did not follow it. The ACAS Code recommends that you be given 10 calendar days to consider their offer, but it can be less if this is considered to be reasonable.

The Code also gives examples of "improper behaviour" associated with reaching a settlement including putting undue pressure on you to agree an offer. This includes, for example, an employer saying before any disciplinary proceedings have begun that you WILL be dismissed if you don't accept the offer, and also all forms of bullying and harassment and intimidation.

What to do if offered a settlement agreement?

You will need to be careful and guarded if there is an unexpected approach by your employer with an offer for you to leave. It can be difficult to negotiate a figure upwards once you have already agreed to it (even though terms are not binding until you have taken legal advice on the settlement agreement). It is not wise to even provide the most basic signal that you are prepared to give up your employment.

Unless you consider the offer is too good to turn down, you should preferably just listen to what your employer has to say at the first meeting- without committing yourself either way, and then take immediate legal advice.

We can represent you in negotiations with your employer and advise you on your employment contract and on the other terms in the agreement, such as agreeing not to recruit your old employer's staff or to compete against them for a period of time, non-financial benefits, confidentiality clauses, and references. As experienced experts in Employment Tribunals we will advise you of your rights to bring a claim if it is not to your advantage to accept your employer's offer. You are not obliged to accept a Settlement Agreement. You will always get an honest and considered assessment of your rights and likely chances of success as an alternative to signing.

Your employer will usually pay your legal costs involved in signing the agreement.

How much will a settlement agreement cost?

Nothing. There will be nothing for you to pay if you sign an agreement and your employer is making a payment towards our fees - we will limit our costs to their contribution. We will arrange for payment of our fees direct from your employer.

Insurance Cover

Many of our clients have the benefit of legal expenses insurance. It is sometimes provided as part of the buildings/contents insurance policy on your home or through your union or professional association if you are a member.

We can help you by submitting an application to your insurer to cover our legal fees. As soon as we sign the insurance agreement with your insurers, funding will be in place. The benefit of insurance cover is that your insurer meets the cost of your legal advice in case you do not sign the agreement or if your employer's contribution is not enough.

I'd like to know more about settlement agreements, can you help?

If you have any questions regarding settlement agreements, our expert teams are available to discuss your concerns. Contact us by completing our online enquiry form and our advisors can call when suitable for you or call us direct on 08000 93 00 94.

How can we help?

Funding your settlement agreement advice

There are a number of different funding types in place which can be used to pay for the work we provide on settlement agreements. Please click the button below to find out more information about the funding types available.


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