Specialist settlement agreement solicitor with over 20 years of experience
I work as a specialist Settlement Agreement Solicitor with over 20 years of experience. I offer a fixed fee service, which usually corresponds to the amount your employer has agreed to contribute. Your employer will pay me directly upon completion.
You can review my standard Settlement Agreement terms by clicking here. The fee covers advice on the agreement and reasonable negotiations but excludes disputes or complex negotiations. If you intend to bring proceedings against your employer or consider yourself far from reaching an agreement, you may wish to find a litigator through The Law Society’s excellent ‘Find a Solicitor’ search tool.
My aim is to efficiently assess your situation and focus on achieving your goals without causing further unnecessary tension with your employer.
What is a Settlement Agreement?
A Settlement Agreement is a contract that ends your employment. Once signed, you cannot bring claims to an Employment Tribunal. The terms are generally straightforward. In exchange for an enhanced payment, you waive your right to bring claims.
The settlement agreement has been created with the aim of protecting both parties. It typically includes clauses on confidentiality, return of property, post termination restriction such as non- compete, non-solicitation of staff and customers, the reputation of the parties, confidentiality, a reference and protection on announcements.
Key Considerations
Settlement Agreements are often favourable and sometimes disappointing. Signing is entirely voluntary.
Some guiding questions include:
What are your future career plans?
How does the offer compare to what you might receive from a tribunal?
What claims are you considering, and what evidence do you have?
How quickly could you find another job?
If you can secure employment quickly, a legal claim may not be worthwhile, as compensation could be minimal. Keep in mind, most claims require two years of continuous employment (except for discrimination and whistleblowing claims).
Additionally, incidents need to be recent, especially in constructive dismissal cases, where you resign due to employer breaches.
Advantages of a Settlement Agreement
A Settlement Agreement is generally preferable to a legal dispute due to several key benefits:
No legal fees: Using a lawyer can reduce your settlement by up to 33%
Tax efficiency: Compensation payments are tax-free up to £30,000.
Reputation protection: The agreement will often include a positive reference and protection against negative comments.
Future employment prospects: Ongoing disputes can deter potential employers.
Litigation risk: There’s always a chance you could lose in court.
Less stress: Employment tribunals are known for being stressful and can take over a year to resolve, often with former colleagues involved.
What does a Settlement Agreement cover?
Settlement Agreements typically address:
Notice: Your employer must provide notice, either according to your contract or the statutory minimum notice. Notice can be worked, served as garden leave, or paid in lieu, and is always subject to tax.
Termination Payment: Also called an ex gratia payment or compensation payment this is the compensation you will receive.
Employee Warranties: You may be asked to confirm that you are leaving on good terms and don’t have another job lined up.
Confidentiality and Business Protection: Your employer may include reasonable restrictions on what you can do after you leave, usually lasting no more than six months.
Benefits: Health care, pension contributions, or other perks may end on or be extended after, the termination date.
Handover: Returning company property, providing passwords, and removing work-related files from personal devices.
Tax Indemnity: If HMRC challenges the tax-free status of the compensation payment, you may be liable for additional tax. Payments over £30,000 can sometimes be surrendered into your pension for tax efficiency.
Frequently Asked
Questions
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The fairness of your offer may be determined by how it compares to your basic entitlements at a tribunal:
Basic Award/Redundancy Payment: Calculated based on a week’s pay. As of April 2024:
£700 per year worked under age 41
£1,050 per year worked over age 41
This award is capped at 20 weeks and is tax-free.
Notice: Either set by your contract or statutory minimum, with tax and NI deductions.
Compensation/Unfair Dismissal: Typically lost earnings, capped at one year’s pay (maximum of £115,115). Compensation is uncapped for discrimination or whistleblowing claims.
Discrimination and Whistleblowing: Compensation for these claims includes both lost earnings and injury to feelings, with no upper limit.
As of April 2024, the injury to feelings awards are:
Lower Band: £1,200 - £11,700 (less serious cases)
Middle Band: £11,700 - £35,200 (moderately serious cases)
Upper Band: £35,200 - £58,700 (most serious cases)
Exceptional cases may exceed £58,700, usually involving sustained, malicious behavior.
Pension Contributions
Contributions made directly to pension schemes are separate from the £30,000 tax-free allowance and are typically not taxed, subject to annual and lifetime limits.
For compensation above £30,000, you may wish to allocate some of it to your pension for tax efficiency, subject to your pension provider’s rules.
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If no agreement is reached, you may choose to bring a claim, but be aware that you have strict time limits—usually three months from the termination date.
The process starts with ACAS and may proceed to an employment tribunal. It’s essential to seek legal advice promptly.
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What I Need From You:
A copy of your Settlement Agreement
Your mobile number
The HR manager’s name and email
Your employment contract (if relevant)
I don’t require a copy of your passport or driving license, as I do not hold any client funds.
Your employer will pay any amounts due to you directly.
Contact Us
Want to talk about it? Fill out some info and I will be in touch shortly by email.
Call me on 07860 350300 or click the button below: