Settlement agreements and you 

A settlement agreement is a contract between an employer and an employee, used to resolve a disagreement or reach a compromise about the terms of ending employment. It usually involves an employee agreeing not to make a claim to a tribunal or court, in return for a payment or concessions to the employment contract.  
Employees must receive legal advice before entering a settlement agreement. We can help you understand the meaning and effect of the settlement agreement and its implications for your legal rights. We can also support you in negotiating the terms of an agreement. Our employment solicitors are very experienced in settlement agreement advice. 

Who pays for the advice? 

Your employer will almost always offer a contribution towards your legal costs for advice on the meaning and effect of the settlement agreement. The employer’s contribution is usually enough to cover the cost of providing advice to an employee, and so there may not be a charge to you for our work. 
This does not mean that we have any connection to, nor owe any obligation to, your employer. If we are instructed by you, we are your solicitor not your employers, and we will give the best advice for you. 
You may wish to negotiate the terms of the agreement that your employer has suggested. We can support you with this. If this takes more time than your employer has funded, negotiation will be charged at our standard hourly rate. However, where negotiating the terms for a better financial settlement, this investment pays for itself. 

When are settlement agreements normally used? 

The purpose of a settlement agreement is to record how the terms of employment will end or a dispute will be resolved. Those terms are usually that the employer will pay a sum of money in return for the employee giving up rights to make the employment-related claims set out in the agreement. 
Settlement agreements are becoming increasingly common in cases of redundancy. They are also used in many kinds of cases where employment law issues arise such as unfair dismissal or discrimination claims. 

In summary, the rules on settlement agreements are: 

The settlement agreement must be in writing 
The settlement agreement must contain certain information stipulated by law 
An employee must receive advice on the meaning and effect of the settlement agreement by someone qualified to do so such as Spencer Shaw Solicitors 
The advice must include the effect of the settlement agreement on an employee’s ability to make a claim to an employment tribunal. 

Get in touch 

Do you have a legal matter you'd like to discuss with us? Get in touch using the details below or use the form here and a member of our team will be in touch to discuss your enquiry. 
Phone: 0121 452 5130 
Address: Spencer Shaw Solicitors Limited 
Vancouver House, 111 Hagley Road, Edgbaston, Birmingham B16 8LB 
Opening hours: 
Monday - Friday 9:00AM - 5:00PM 
Saturday, Sunday & Bank Holidays - Closed 
Connect on social media 
We take your privacy seriously and will only use the information you provide on this contact form to deal with your enquiry. Please see our Client Privacy Policy for more detail. 
Our site uses cookies. For more information, see our cookie policy. Accept cookies and close
Reject cookies Manage settings