Settlement Agreements

A Settlement Agreement, formerly known as a Compromise Agreement, is a legally binding contract between you and your employer to resolve disputes without going to an Employment Tribunal. It often includes a financial settlement and may cover issues like redundancy, discrimination, or unfair dismissal.

FAQs

What are they used for?

The main purpose of a settlement agreement is to settle actual or potential claims that an employee might have against their employer. However, even when the employee does not have a claim, they are often used to facilitate a smooth and mutually agreed termination of employment, sometimes referred to as a ‘clean break’. In return for a sum of money, the employee agrees not to pursue any claims against the employer and both parties go their separate ways.