Settlement agreement negotiations are common when going through the settlement process.
The reality is that both the employee and the employer will probably have different goals for what they want to get out of the agreement.
This is why negotiating is crucial – so you achieve a positive outcome that everyone is satisfied with.
A settlement agreement is where an employee agrees to waive their right to bring legal action against their employer, usually in exchange for a settlement payment.
It’s pretty common during redundancies, but they’re not identical and settlement agreements can happen regardless of redundancy.
Negotiation Of A Settlement Agreement
Employers are often open to the idea of a settlement agreement, and there’s good reason for that.
Because settlement agreements are usually relevant in situations where an employee’s time at a company is coming to an end, for whatever reason that may be.
And the last thing anybody wants is for a prolonged period of negotiations to drag out and cause uncertainty for everyone involved, or for the case to end up going to a tribunal.
This is why many employers will offer a settlement agreement, rather than going through the full process of redundancy or other formal legal processes.
And if you’re wondering how the settlement agreement process works, then the good news is that you’re fully entitled to request a settlement agreement from your employer.
It’s not common and if you’re looking for a quick resolution, it might just be your best option.
The first £30,000 of any settlement agreement or redundancy payment is tax-free, and any settlement agreement can include things such as:
- A termination payment
- Any remaining salary, notice pay, holiday pay, bonuses, and commission
- A written agreement for the employee to waive their right to bring legal action at a later date
- A signature by a solicitor or official representative
- A ‘non-derogatory clause’ where both the employee and employer agree not to say anything negative about each other
- A non-disclosure clause
Negotiating a settlement agreement will involve employers requesting specific things to be included, often non-monetary requests such as non-disclosure clauses and perhaps even non-compete clauses.
It will depend on the reasons for you leaving the company and for the settlement agreement, and it’s entirely up to you what you accept and negotiate.
For example, you might go in with the goal of settling for a £20,000 settlement but have no qualms about any formal agreements.
Whereas your employer might only want to settle for £15,000 and include various legal agreements.
At this point, it might be prudent to seek expert independent legal advice to ensure that the negotiations are fair and you get the best possible outcome for yourself, so you can move on to your next opportunity knowing that you’re financially secure.
Having a settlement agreement adviser on hand can be invaluable throughout what is an important process. They could be a solicitor, union representative, or someone who can advocate for you.
Considerations need to be made over your long-term financial future and how any settlement agreement will ensure that you’re comfortable moving forward.
Having someone on your side who is a legal expert can be invaluable, especially when it comes to knowing what your employer is looking for, where it’s best to settle, and what a fair agreement would be.
Settlement Agreement Solicitors Near Me
We know that everyone has commitments, whether that’s family, a mortgage, rent, childcare costs, bills, running a car, travel, or anything else – the list is endless, really.
Which is why ensuring you receive a fair settlement is crucial – and at Solicitors Near Me, we’re here to help.
We connect you with employment solicitors near you for FREE so you can get legal advice and resolve your redundancy situation.
There’s no obligation to proceed with the solicitor that we connect you with, and there’s zero cost until you make a decision, either…
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