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Expert legal support for Settlement Agreements
As a company, it is never easy having to make staff redundancies. However, settlement agreements can provide a more amicable and less conflictive alternative for businesses.
When employment disputes arise, it is important to get the help and legal advice you need for a speedy and satisfactory resolution rather than a protracted and damaging conflict. At Labrums, we have a number of specialists and solicitors who understand every aspect of employment law to help you do just that.
What are Settlement Agreements?
Settlement Agreements are voluntary agreements between an employer and their employees, and are able to address a wide range of issues such as redundancy, grievances and variation of employment contract terms. They are legally binding and are predominantly used to terminate employment.
Settlement Agreements are confidential and, in essence, they waive employees’ rights to bring any tribunal claims in return for financial compensation. Often, terms are mutually agreed through discussion and negotiations.
What are the advantages of Settlement Agreements?
Once agreed and signed to make them legally binding, Settlement Agreements provide employers with extra protection from potential tribunal claims employees might contemplate bringing. This is particularly advantageous if an issue such as discrimination has arisen and the employer was unaware.
For employees, the agreed terms might be more favourable than an outcome at tribunal or court. Any proceedings always carry a high degree of risk of not going in one party’s favour.Settlement Agreements can contain terms a tribunal or court is unable to order, such as an agreed reference to future employers or an apology. They are a quick, cheap, less stressful and easier way of settling disputes, giving closure as opposed to drawn out and expensive battles fought in tribunal or court. Furthermore, up to £30,000 of the compensatory element that is not contractual is a tax-free award and there should be no costs involved for employees.
What are the alternatives to a Settlement Agreement?
Sometimes, going through a redundancy process or taking employees through a disciplinary procedure can be a preferred solution for an employer, and could cost the business less up-front. However, there can be risks involved, for example if the employees were to take their employer to court.
On the other hand, Settlement Agreements will waive most rights of the employees ever bringing a claim to tribunal or court on the issue, even if the employees become aware of something they did not know at the time of discussions and negotiations. The financial compensation received could be requested back by the employer, if the employees fail to keep the agreement confidential or breaches any other term – this can make a Settlement Agreement far more cost-effective, and a much safer option in the long run.Ultimately, you may need to make a cost-benefit analysis. This is very important, especially if there are added complications such as absence due to stress or long-term sickness which could contribute to disability, and the implications this might have should employees challenge the dismissal.
Contact our Settlement Agreement Solicitors today
Labrums’ dedicated settlement agreement solicitors work in partnership with businesses in St Albans and nationwide at all stages of Settlement Agreements and employment law. We know that you need pragmatic advice, expert guidance and regular communication when it comes to such important matters, and we will work with you to identify and understand the best solutions for you.