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Compromise agreement payments

The key behind any compromise agreement and the payment is to get the financial compensation that is right for you.

A couple of key points to remember with regards to the compromise agreement payment is:

  1. The vast amount of the payment (the first £30,000) is tax free, but you will need to talk to a solicitor to find out your precise tax implications.
  2. The payment can include unpaid wages, holidays you have remaining, loss of salary in the immediate future.
  3. Payment in lieu of notice (PILON).
  4. Bonus, commission or share awards payments.
  5. Payment against any potential unfair dismissal claims.
  6. The exact amount that will be fair for you differs from person to person and differs depending on specific situations and circumstances, talk to us and we can provide you will a genuine assessment on what we believe your compromise agreement is worth. DON’T LOSE OUT.

If you need any help with your settlement agreement and release from your contract then please get in touch with us.

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Settlement agreement and release

If your employer is looking at releasing you from their employment then they could offer you a settlement agreement, this legal document releases you from their employment offering financial (and other) compensation in doing so.

If you have been approached about a settlement agreement, then there are a couple of key points to keep in mind are:

  • It is highly likely that during this process you will have had a meeting (or several meetings) with your employer at which your release from the business will have been discussed and an agreement suggested.  It is really important that during these meeting you make detailed notes of what was said and what happened, as any issues with the conduct of your employer during these meetings could give rise to an increase in the financial benefit that they will need to offer you.
  • We also recommend that you don’t just think about money you might be offered; as other benefits could mean that you might find new employment quicker.  You couple for example agree the wording of any internal announcement of your departure, or agree a reference, both of which could help you to secure your next job quickly.  We have also seen cases where employees have been able to keep a laptop or mobile phone to assist them in the search for a new job.  So whilst the financial compensation is important, it not necessarily the most important factor.

If you need any help with your settlement agreement and release from your contract then please get in touch with us.

​Settlement Agreement – do I have to sign?

No, not at all, a Settlement Agreement is a completion voluntary proposition – although we have had clients who have been told that they have to sign, it isn’t true. In fact an employer who tries to ‘force’ an employer to sign a Settlement Agreement could end up in a lot of trouble and having to pay out more money.

Remember that if you decide that you do not want to sign the agreement, then you retain your full employment rights in UK Law to make a future claim against your employer in an Employment Tribunal, but you’ll need to move quickly as there is a strict time limit to ‘issue’ of three months less one day for a routine unfair dismissal claim.

If you want more advice, then just get in touch with us today.

How to tell if your settlement agreement package is a good deal

Settlement agreements tend to use used where the employer is expected to pay more than the statutory minimum entitlement.  The benefits of paying more is that it provides a certainty (for both parties) that no further dispute or court action (employment tribunal) will take place.

But how can you tell if the deal you are been offered is fair?

A good settlement will provide you the equivalent of between four to six months equivalent salary, which is good for employees, because in todays market it could take a little time to get new employment that offers the same benefits as your current role.

But as they are no fixed rules for what you should be paid then figures differ a great deal.  Expect more money if your notice period is longer (3 months plus), and expect less if you have a shorter notice period.

It’s important that you work through your own personal finance and presume that it will take you three months to get a new role, this will give you a ballpark figure of what you would like from the settlement.

An employment solicitor will look at your contract and your settlement agreement ad advice you on whether negotiation will help you or not.  They will also be able to advice as to whether the compensation offered is fair.

When it comes to the negotiation an employer can always flatly refuse to pay more, but if you don’t ask you won’t get.

We also suggest that you personally don’t negotiate but get your employment solicitor to do it for you, it’s their area of expertise and it’s part of the service that your employer is paying for.

Settlement Agreement Solicitors

It’s both interesting and true that not all Employment Solicitors make good Settlement Agreement Solicitors; sure, an employment solicitor will know and understand the technical aspects of settlement agreements and how to produce them, but as an employee you need something different, you need someone different.

You need a solicitor with some additional skills to ensure that you get the most from your agreement.

  • They obviously need to be a great listener, they need to fully understand your particular circumstances.
  • They need to be a great communicator, settlement agreements are usually conducted over the phone, and you need to be able to understand the advice.
  • They need to be able to see through the emotion and provide you with clear, high quality, friendly advice.
  • They need to have the balls to (where necessary) go up against your employer to get you a better deal.
  • They need to be litigation experts to negotiate with your employer on your behalf.

I am that solicitor, you will get the very best advice, and I am very happy to ensure that your employer gives you the very best deal that they can. Get in touch with a free, no obligation chat today.