Employer Settlement Agreements Advice

What is a settlement agreement?

A settlement agreement (previously known as a compromise agreement) is used to legally terminate a contract of employment and is usually used during redundancy or severance procedures. The following are the most common details to be included, however, other related issues can also be included:

  • An agreed amount of compensation to be paid to the employee
  • Any restrictions on an employee’s future employment
  • A reference for the employee
  • Details on the termination for other employees
  • Any assurances made by either the employee or employer


Ultimately, the benefit of a from the point of view of a business is that once signed, the employee will no longer be able to issue a claim in the employment tribunal or other court arising out of, or in connection with, with the termination of their employment.

Also, it can be a relatively quick and straightforward process compared to an employment tribunal which is usually lengthy and stressful. Additionally, an understanding between you and the employee on how much compensation will be paid out can be reached.

In addition, recent developments in employment law have expanded the scope for employers to approach employees and have ‘protected conversations’ with them. These are aimed at concluding an early and amicable settlement without the need for lengthy and time-consuming legal processes to be instigated and followed. We can advise you in relation to whether it is appropriate for you to commence a protected conversation with one or more of your employees and, if so, the steps that you will need to take to maximise the prospect of a successful outcome.

We have a wealth of experience when it comes to assisting businesses with the negotiation, drafting and successful conclusion of settlement agreements for employees at all levels. We also ensure that the agreements that we draft and prepare protect the continuing needs of your business.

We can help

Contact us today using the details below to speak to one of our Employer Settlement Agreement Advisers. We can provide advice and guidance on the best way to approach employees and help you draft the legal documents needed to conclude proceedings amicably and successfully.

Lupton Fawcett are a leading personal and commercial law firm in Yorkshire with well-established offices of highly experienced solicitors in Leeds, Sheffield and York.

We provide a personalised service, with sector specialists and extensive resources to ensure we are giving you the best solutions to your problems.

Within every area of law, we put your interests first.

Our Employment Law Solicitors act regularly for clients across the United Kingdom including Bradford, Birmingham, Hull, Leeds, Liverpool, London, Manchester, Sheffield, York and Nottingham.  We also provide specialist niche legal and commercial services for Irish companies wishing to do business in the UK and legal advice for UK companies trading in the  Republic of Ireland.  We can support your needs wherever you live in England, Wales, Northern Ireland and Ireland.

We will always respond promptly, and we will be happy to help.

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