Employee Rights - Compromise Agreements

We are able to assist in drafting compromise agreements for employees who are leaving the employ of the employer. A compromise agreement is a legally binding agreement (put into written form) to accept compensation from an employer instead of the employee pursuing the case through an Employment Tribunal.

Increasingly employers are now using compromise agreements to prevent future claims in numerous situations.

The compromise agreement makes sure that any agreement reached between the parties is clear to both parties and ensures that specified claims in the employment tribunal can no longer be brought against the employer.

Redundancy situations
Employers who want to prevent employees complaining to tribunal after they have been made redundant may make use of compromise agreements in such situations.

The contents and effect of a compromise agreement
The effect of signing a compromise agreement in these circumstances is that the employee, in effect, signs away their right to complain to the Employment Tribunal. The compromise agreement will contain all payment details and can also deal with matters relating to confidentiality, returning of documents and so on.

A compromise agreement is a document which outlines the terms of the agreement between the employer and employee. It is a confidential document and can be specifically stated to be so.

If the matters relate to a payment for compensation e.g. in a case of discrimination, the agreement will contain the details of any payment and an acceptance of the terms not to pursue any claim.

If the matters relate to redundancy, the package for redundancy will be spelt out clearly and the employee will sign away their legal rights to make any claim against the employer

The law requires that before any compromise agreement is signed, the employee must seek independent legal advice. The employee must understand the implications of the document he or she is signing. The professional adviser must sign a declaration to confirm the advice has been given.