What is a Compromise Agreement/Settlement Agreement?

- It is also sometimes called a Settlement Agreement
- It is a legally binding agreement regarding the termination of your employment.
- Your employer will pay you a payment in return for which you agree not to pursue any claim you may have to an employment tribunal

You must have the agreement explained by an independent solicitor before the agreement becomes binding.

The independent solicitor giving the advice must also sign the agreement and certify that the appropriate advice has been given.

What terms are in the Compromise Agreement/Settlement Agreement?

Most compromise agreements have the same types of clauses but which may be worded slightly differently. You should expect the following:

- full breakdown of the payments you are receiving
- the taxable statue of the payments
- tax indemnity
- confidentiality
- a non-exhaustive list of the claims you are restricted on pursuing

We will of course explain all the clauses in simple and plain English.

Why do I need a Solicitor?

- The agreement will contain complicated legal language which you need to understand
- The agreement will refer to special legal terms
- You must receive advice from a professional advisor such as a Solicitor
- It is a legal requirement that the agreement is signed by a professional advisor

Why MTG?

- We have advised on many compromise agreements
- We also draft compromise agreements so we know exactly how they work
- We are completely independent so you can be sure that you are getting the best advice
- We will not normally charge you as your employer will pay our fee
- We will explain the agreement in clear and plain English so that you fully understand
- We can advise you wherever you are in the UK and we do not need to see you

What happens if I am not happy with the Agreement?

- There is no legal or other obligation on you to sign a compromise agreement
- You may lose any enhanced payments that the agreement provides
- You can still bring a claim at an Employment Tribunal (as long as it is within the time limits)
- The agreement cannot be used in any court or tribunal hearings as it will be marked Without Prejudice.

If you wish to reject the compromise agreement and bring a claim against your employer, we may be prepared to consider a no win-no fee funding option. Please contact us to discuss this further.

What do I need to do now?

Call us on 020 8754 5577 or email us on employment@mtgsolicitors.com

and we can advise you on how best to take this further.


We can help you understand your compromise or settlement agreement in plain and simple English!