My Compromise Agreement – Am I Obliged To Accept My Employer’s Terms?

Although Compromise Agreements primarily deal with financial compensation, it always a good idea that you are fully up to speed because there are provisions contained in these agreements which could potentially affect you after you have left your current job.

Your Compromise Agreement will state the full breakdown of compensation you are entitled to and which payments will be tax-free, i.e. up to £30,000 in the case of an ex-gratia payment (compensatory rather than contractual) but you can turn your employers offer down if you think that the money offered is insufficient. You can also turn down a Compromise Agreement on the basis that this is not the way you wish to deal with the termination of your contract.

The need for independent legal advice

The first thing you need to do when considering a comprise agreement is to appoint an independent solicitor to go through with you. Even if you agree entirely with the terms of the offer from your employer, independent legal advice is essential if your compromise agreement is to be binding on both you and your employer. Your solicitor should look at the different sums offered to you in your Compromise Agreement and advise you if it is a good deal. If the amounts offered are satisfactory your solicitor should provide you with advice as to whether you have a strong claim were you to take your case to tribunal or a court and calculate what you would get if you were to pursue your claims in a tribunal compared to what you are being offered in the Compromise Agreement.

Negotiating a revised Compromise Agreement

If your solicitor advises that the money offered is insufficient they will negotiate on your behalf to ensure a fair sum of money is paid and may also help you to raise a grievance. It is important to lodge a formal written complaint to protect your position if there have been acts of discrimination and if a dismissal has taken place, your solicitor will assist with your appeal.

Knowing the value of the restrictive covenants to your employer will also assist your Solicitor in assessing the fairness of the amounts offered in your Employment Compromise Agreement.

Whatever the circumstances under which you have been presented with a Compromise Agreement, it is important that you speak to a Solicitor as soon as possible. Contact our team of specialist employment lawyers today for expert Compromise Agreement legal advice on securing the maximum amount of compensation due to you. Unlike some solicitors, who treat Compromise Agreements as an expensive rubber stamp process, our team of specialist employment law solicitors will review your settlement and, if appropriate, try to negotiate a better deal for you.

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Compromise Agreement – When To Keep Silent

If an employment relationship comes to an end, a compromise agreement is often entered into between the employer and the employee. The UK compromise agreement is a confidential document that sets out the terms upon which the employment contract ends. It will include details of any payments that the employee will receive and there will be promises made by the employee that the employer says it is relying upon to enter into the agreement.

A frequent promise asked of the employee is that he or she will not say any disparaging or critical remark about the employer in the future that could damage its reputation.

Facebook and Twitter

In the social media age, many people communicate with friends and others on Facebook or Twitter. If you leave employment on bad terms, there can be a temptation to let your friends, and sometimes the world, know what you think of the old employer.

It is important to remember that the promise not to damage the reputation of the employer will be linked with a right to demand the compensation back if you don’t keep the promise. Some employees have lost their compensation after comments put on Facebook or Twitter.

Also, it is worth remembering that many employers who are  interviewing for new positions check Facebook or Twitter to see if the person applying has a public profile in that way. I have heard of someone who did very well at interview and would have been offered the position but was not because after the Employer looked at Facebook, it didn’t like some of the remarks that were made on it.

Independent legal advice

Any employee asked to enter into an employment compromise agreement is required by law to receive independent advice from a solicitor about what it means before signing it. Do ask your compromise agreement lawyers, if there is an obligation in the agreement that you have to refrain from criticising your employer after you have signed it.

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Don’t Rush in to Signing your UK Employment Compromise Agreement

Most people would always think twice before signing any legally binding document or agreement, and with an employment compromise agreement this should be no different. In fact, when you sign your UK compromise agreement you are agreeing to a full and final settlement and giving up your right to take further action against your employer, which is why it is vital that you give the matter a lot of thought and consideration rather than rushing into signing it.

These employment compromise agreements can be very beneficial for the employer and the employee, but employees still need to think long and hard as to whether this is the best course of action and whether there could be any improvement to the settlement or terms of the agreement before it is signed.

As it is a legal obligation for employees to get independent legal advice about these  agreements before signing them it you should talk things over with specialist employment solicitors, which can prove invaluable for those that are confused or worried over what to do. Without this legal advice your compromise agreement is not legally binding – however your employer will usually fund some or all of the cost of this legal advice for you.

Before you make your mind up about whether you want to sign the agreement or not make sure you discuss fully the details of the issue and the actual agreement itself with your solicitor. Your solicitor can offer valuable advice on the fairness of the settlement in the agreement as well as checking over the terms and condition of the agreement. You should avoid rushing into a decision until you have discussed the agreement with your solicitor in details and received feedback from him or her with regards to the contents of the agreement.

By going over your employment compromise agreement in fine detail with the solicitor, and getting a better understanding of the agreement and what it means to you, it is possible for you to make a far more informed decision on whether to sign the agreement or look at the other options available to you. Do bear in mind that your compromise agreement solicitors can get the terms and settlement offer in one of these agreements looked at by negotiating with your employer so you may be able to get a better deal as part of the agreement once you have discussed matters with your solicitor.

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Compromise Agreements Undergo Makeover

In November 2011 the Government published its Response to Resolving Workplace Disputes intended in part to ensure that both employers and employees have a greater chance of resolving disputes as quickly and smoothly as possible.

Following on from this initiative, the government announced proposals in April 2012 for employment law reform which encompass the renaming of Compromise Agreements to Settlement Agreements with effect from July 29 2013. It has been concluded that the word ‘compromise’ denotes inequality and compromise in the employer’s favour not their departing employee. However, ‘Compromise Agreement’ has become a familiar term which is likely to remain in use amongst employment law solicitors, employees and employees for some time to come, especially as ‘Settlement Agreement’ is already in existence as a term used mainly relating to divorce disputes.

Regardless of what these documents are called, Compromise or Settlement Agreements are governed by UK employment law statutes and designed to protect a departing employee from unwittingly losing rights that they may not fully understand. Having said that, the majority of employees will cover the cost of independent legal advice for an employee as it is in their interests to ensure that the Compromise Agreement is valid.

Whether or not the term ‘Settlement Agreement’ will “emphasise the benefits they can offer as a way of resolving and bringing finality to disputes” remains to be seen.

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