If you’re currently in dispute with your employer, then you may have been offered a settlement agreement. These are a means by which an employer/employee relationship can be brought to an amicable conclusion. This will usually involve the employer making a one-off payment to the employee in exchange for the employee agreeing not to make an Employment Tribunal claim in relation to the issue or issues in dispute.
Can I refuse to sign a settlement agreement?
A settlement agreement needs to be carefully considered before it’s signed and the employee should fully consider the details of the offer. ACAS states that an employee should be given 10 calendar days to consider the details of the offer and to seek independent legal advice. It’s a legal requirement that an employee who has been offered a settlement agreement must receive independent legal advice from a solicitor, union representative or from the Citizen’s Advice Bureau. Without a signature from one of these professionals verifying the employee has received advice, a settlement agreement cannot be made.
If, after having received advice, you conclude that the settlement agreement is not satisfactory, you can reject the settlement agreement. It’s important to remember that should you accept the settlement agreement you will be unable to revisit its terms or make any future claims against your employer.
Negotiate a new agreement
It may be possible with the advice and assistance of a solicitor to negotiate a better settlement agreement. This may include a bigger pay-out, which if you’re facing a period of unemployment or employment uncertainty, will help you to better meet your household living expenses until you’re able to find new employment.
An employer is unlikely to cover the cost of your legal advice during any settlement negotiations. The cost of this will need to be kept in mind and consideration given to whether you believe that a significantly better agreement can be achieved through continued negotiation.
If an employee and their employer find it impossible to reach an agreement, then the employee may be able to make a claim against their employer in a tribunal. A time limit of three months minus one day from the date that the employment was terminated exists in which an employee is entitled to make a claim. This limit extends to six months minus one day if the claim is for statutory redundancy pay.
Find out more about settlement agreements
At Freeman Jones, we help our clients negotiate settlement agreements with their employers. We can advise on the content of any settlement agreement and the likelihood of success should someone decide to renegotiate.
To find out more about settlement agreements, please read our FAQs and call 01244 506444 to speak to one of our experienced employment specialists.