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EMPLOYERS who want staff to leave under new settlement deals run the risk of legal action if they put them under pressure.

What are Settlement Agreements?

Settlement Agreements are being promoted by ACAS as a means of resolving workplace disputes without resorting to the Employment Tribunal.

Benefits of Settlement Agreements for Employees

For the employee, they offer a tax-free lump sum to compensate for the employment coming to an end. For the employer, they offer the certainly that there will be no further litigation or Tribunal cases.

However, the new legislation makes it clear that  these Agreements can be over-ridden if the employer has done or said anything during negotiations that can be regarded as “improper.”

Formerly  Compromise Agreements

Normally the documents  – formerly known as Compromise Agreements – make it clear that no claim can be brought in the future, and neither side can rely on the negotiations as the basis of a claim. But the rules provide for there to be exceptions.

There will be where the employee can show that during the negotiation the employer has:

–        used offensive words or aggressive behaviour;

–        victimised the employee;

–        discriminated on the grounds of age, sex, race, disability, sexual orientation, religion or belief, transgender, pregnancy, maternity, marriage or civil partnership;

–        put undue pressure on them, for example by saying that rejecting a Settlement Agreement will lead to dismissal.

The new rules also state a period of 10 calendar days should also be offered to the employee to take advice, and the effect of this will be likely to be to delay the date on which employment actually comes to an end.

Employment Tribunals and Settlement Agreements

The ACAS guidance makes it clear it will be up to an Employment Tribunal to decide whether they are prepared to hear evidence of the “improper behaviour”, but in the meantime employers are advised to consider any settlement approach carefully.

Settlement Agreement Lawyers Glasgow

*The Glasgow Law Practice advises employers and employees on Settlement Agreements. Contact