If you’re a business owner or employer looking for straightforward advice on Settlement Agreements, our expert solicitors are here to help.
What is a Settlement Agreement?
A Settlement Agreement is a legally binding contract between you and your employee.
It’s often used to resolve workplace disputes by agreeing on clear terms and conditions. Typically, you, as the employer, provide a compensation payment, and in return, the employee waives their right to bring legal claims against your business.
Why Use a Settlement Agreement?
Resolve disputes quickly
Address grievances or disciplinary issues efficiently, ensuring a fair and timely resolution.
Avoid legal action
By agreeing to terms with your employee, you can skip the uncertainty, time, and cost of an Employment Tribunal hearing.
Control costs
A settlement agreement sets a fixed compensation amount, helping you avoid unpredictable costs and legal fees down the line.
Maintain positive relationships
Handling disputes amicably can help preserve professional relationships and protect your business’s reputation—even if the employee is leaving the company.
Protect against future claims
Settlement agreements usually include a waiver of claims clause, shielding your business from future legal disputes related to the agreement.
What Needs to Be Included?
To be valid, a settlement agreement must meet specific legal requirements:
- Written agreement: It must be in writing.
- Specific complaint: It must address the specific issue raised by the employee.
- Independent legal advice: The employee must receive advice from an independent legal adviser about the agreement’s terms.
- Legal coverage: The legal adviser must have proper professional indemnity insurance.
- Named adviser: The agreement must name the independent legal adviser involved.
- Statutory compliance: The document must confirm that all legal requirements have been met.
How We Can Help
At Fitzhugh Gates Solicitors, our business law experts provide clear and practical advice tailored to your needs. We’ll guide you through the process of creating a settlement agreement that works for you and ensures your business is fully protected.
Get in Touch
Contact us today to learn more. We’re here to make the process simple and stress-free.
