Successfully Negotiating Settlement Agreement for an Employee

Our client had been having issues at work and, shortly after raising a grievance in respect of the same, was asked to have a ‘without prejudice’ conversation with their employer. As part of this conversation, the client was offered a settlement agreement, which the employer claimed was unrelated to the grievance, instead citing a breakdown in their working relationship and disciplinary concerns.

Our approach was to meet with the client to understand the background of the matter, including the circumstances leading up to the settlement agreement, their employment history, and to advise them of any potential claims they had against their employer. This allows the employee to understand what their options are moving forwards, both in respect of accepting the settlement agreement and any other avenues, such as pursuing a claim.

We also discussed the suggested amendments we had for the settlement agreement, in particular waiving certain restrictive covenants and requesting that commission payments be included.

In this case, there was quite a lot of background to go through, so a second meeting was required to go through the terms and effect of the agreement itself, once we had adequately considered all their options moving forwards. It is a legal requirement to take legal advice on the meaning of a settlement agreement in order for it to be valid and binding, so this second meeting was required in this case.

Following the meeting and some further correspondence with the employer to finalise amendments, the settlement was agreed and signed by the parties.

We successfully negotiated a settlement agreement which the client was happy to proceed with, including waiving some of his restrictive covenants to allow him to move forwards and obtain a new role, and an increase in the monies he would be receiving under the terms of the agreement to include a pro-rata commission payment for work completed in the current financial year up to the termination date.

It is important to seek advice regarding settlement agreements from someone who will not only explain the settlement agreement itself, but also who will take the time to consider the circumstances leading up to the agreement and your employment history. It is vital for an employee to understand what rights they are giving up as part of the process and also what options they have moving forwards.