Settlement Agreement

Also included in Staff Handbook

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This Settlement Agreement, (previously known as a Compromise Agreement) is used to agree terms between an employer and an employee or recent ex-employee in order to prevent a claim proceeding to an employment tribunal hearing. The agreement complies with the legal requirements for an employee to have independent legal advice regarding the details of their settlement agreement.

The Settlement Agreement is clearly marked "without prejudice" to prevent an employee subsequently using evidence of an offer at an employment tribunal or court, should an agreement not be reached between the employer and them.

This agreement complies with the Equality Act 2010.

The agreement includes restrictive covenants that impose post-termination duties on employee, including confidentiality and non-competition.

The agreement also includes a resignation letter to be used by the employee.

The clauses in this agreement include:

• Outline
• Termination
• Complaint
• Payments & Compensation
• Tax and National Insurance Contributions
• Legal Costs
• No Liability
• Claim
• Statutory Requirements
• Offices
• Organisation Property
• Confidentiality
• Restrictive Covenants
• Reference
• Independent Legal Advice
• Without Prejudice
• Severability
• Entire Agreement
• Jurisdiction
• Schedule 1 - Insert Reference
• Schedule 2 - Resignation Letter

A detailed Settlement Agreement will cover all the points of a proposed settlement between an employer and an employee (or ex-employee). For the employee, it is an opportunity to seek outside legal advice. For the employer, it is a very cost-effective way to negotiate a settlement and avoid the time, expense and possible negative publicity of an employment tribunal hearing.

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