Settlement agreements are legally binding contracts used to avoid any litigation arising out of an employment contract. However, they can also be used in ongoing employment cases to settle disputes that may arise between an employer and an employee.
An agreement should be customized for a particular employee and their specific circumstances. Such agreements can be beneficial for business owners in the following ways.
As a business owner, you can agree with the employee whose contract is coming to an end to give them a compensatory termination payment. The details of the settlement agreement may provide that the employee will waive their right to file a tribunal claim against you. Therefore, the agreement can protect business owners against further claims, leading to huge losses to their business.
The employee cannot waive their right concerning claims relating to personal injury or accrued pension rights. A settlement agreement allows an employer to clear with the employee knowing that no further employment tribunal claim may arise. Sometimes employment disputes may occur in case of employment termination.
If you desire to solve employment disputes and achieve the best outcomes, seek settlement agreement advice. Experienced solicitors offer employment advice customized to your business needs. By proposing a settlement agreement, you can avoid an employment tribunal claim, ensuring your reputation and interest are fully protected. Settlement lawyers offer clear legal advice without jargon and our services are affordable. In today’s world, it is all about brand reputation and every small case has the potential to snowball into a big controversy so the best advice is to depend on experienced attorneys.
A settlement agreement can also be useful in the case of any ongoing grievance. It can provide a framework for performance management and any cases of long-term work absence as a result of a sickness. If a business is being transferred to new owners or a grievance that cannot be resolved through a normal mediation, a settlement agreement may be useful.
Each settlement agreement is unique but it must have sections dealing with the settling of claims, payments, tax issues, and any agreed reference. As such, it may be very unlikely that there could be any form of dispute in case an employer is declared redundant.
The agreement must be in writing and both the employer and employee should agree after receiving legal advice from a solicitor. The agreements should include the nature of the claim to be settled and how much an employer should be paid if they are declared redundant.
The employer should engage in pre-termination negotiations to discuss the terms of dismissal with the employee. Since the settlement agreement is legally binding, the business owner may benefit by having peace of mind and security.
Employment disputes may occur due to the failure of the employer to meet workplace obligations, inconsistent treatment of employees, cultural differences, and so on. Sometimes employers may bring claims that are not justifiable in particular circumstances. A lawyer may help you to draft and use the settlement agreement to settle any alleged disputes.
Most agreements include a confidentiality clause indicating that if there are any disputes between the employer and the employee, this issue should not be disclosed to other employees. The settlement agreement ensures that the confidentiality of the issue is strictly observed. ‘
The agreement can also be used to impose restrictions on post-employment that are referred to as restrictive covenants. These may include not taking customers or colleagues away or engaging in unlawful competition after they leave.
The business owner’s resources, such as official documents, keys to lock, and electronic equipment may be protected based on the provisions of the settlement agreement. In case a dispute arises, both the employer and employee must resolve it by an agreement, given that uncertainties may surround the legal proceedings.
Social media can tempt people who may be frustrated by a particular organization to tarnish the name of that organization. The settlement agreement can prevent an employee from making derogatory or adverse comments about the employer and their staff members. Whereas the negative comments can lead to disciplinary action against the employee, such post-employment comments may not provide an employer with cheap recourse.
The details should be included in a settlement agreement to prevent such an occurrence. A non-derogatory clause can be drafted in various ways and cover an employer writing or saying something about their former employer upon leaving employment. In most cases, it covers negative comments about company directors, associates, or brands.
Non-derogatory clauses are uncontroversial and standard because they are based on the transparent nature of the settlement agreement. Employers may need to include more information such as restrictions preventing poaching or employees and solicitation of customers. They can take legal advice when drafting and issuing a settlement agreement.