Resolve an issue with a settlement agreement

Key points

  • A settlement agreement is a legally binding agreement in which an employee (or ex-employee) agrees not to pursue particular claims in relation to his or her employment or its termination, typically in return for a financial settlement.
  • For a settlement agreement to be legally binding, a number of conditions must be met, including that the employee has received independent legal advice from a "relevant adviser" as to the terms and effect of the agreement.
  • An employer that is considering offering an employee a settlement agreement should ensure that it understands the rules on when such negotiations will be admissible as evidence in employment tribunal claims.

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