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Chris Hadrill - specialist employment law solicitorThe news on 8 May that Barclays will be looking to make approximately 19,000 positions redundant by 2016 may lead to an increase in the use of settlement agreements and COT3 agreements over that period of time, according to Employment Law Solicitor Chris Hadrill.

The announcement that there will be a further swathe of redundancies at Barclays, with a total of 19,000 positions being made redundant around the world, signals that there may be an increase this year in the use of settlement agreements (formerly known as compromise agreements) and ACAS COT3 agreements to prevent workers that have been made redundant from bringing claims against Barclays (or any other employer that is making redundancies). More than half of the 19,000 job cuts will fall in the United Kingdom, with Barclays’ investment arm Barclays Capital set to lose 7,000 jobs from a workforce of 24,000 as it looks to move away from its traditional area of expertise in fixed income, currencies and commodities and towards advising customers and equities.

“Redundancy” occurs when an employer experiences one of three things and dismisses employees as a result:

  1. The business as a whole closes
  2. The particular workplace where the employee was employed closes; and/or
  3. There is a reduction in the size of the workforce wholly or mainly attributable to the fact that the requirement for employees to carry out work of a particular kind or to carry out work of a particular kind in the place that the employee was employed by the employer has ceased or diminished

The third ground appears to be the applicable one in the circumstances – Barclays and Barclays Capital have experienced tricky trading conditions over the last year or so and are seeking to shift into other areas, thus requiring fewer employees to undertake work of a particular kind.

It is common where redundancies are being made for settlement agreements (formerly known as compromise agreements) to be used to limit the liability of the employer to the employee in terms of legal proceedings. In return, the employer will (normally) provide the redundant employee with some form of financial benefit and provide them with a reference. In order for the settlement agreement to be valid and enforceable, the employee must obtain legal advice from an independent legal adviser on the terms and effects of the agreement, in particular the effect of the settlement agreement on the employee’s ability to submit an Employment Tribunal claim. A useful beginner’s guide for settlement agreements can be found on this website.

COT3 agreements are agreements which are used by ACAS to settle actual or potential Employment Tribunal proceedings – these have and will become more common as mandatory early conciliation for Employment Tribunal claims has just been introduced.

The effect of the wave of redundancies at Barclays may see the use of settlement agreements and COT3 agreements between employers and employees rise between now and 2016. However, we’ll have to wait and see what the actual effect of these redundancies at Barclays (and other institutions) will be.

About

Redmans Employment Team deal with employment matters for both employers and employees, including drafting employment contracts and policies, advising employers and employees on compromise agreements, handling day-to-day HR issues, advising on restructures, and handling Employment Tribunal cases for both employers and employees

Call 020 3397 3603 to speak to one of the members of our employment team or email us on enquiries@redmans.co.uk.

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Redman's provided excellent legal employment advice for me during a difficult time in my employment. Chris was my lawyer, super efficient, quick, reliable and clearly very experienced in the matter. Could not ask for a better law firm to deal with your query if you are in need of some help. Would definitely use them again in the future. Highly recommending Chris.

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Anonymous

Excellent work delivered with great quality

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Dominic

Chris Hadrill was a great help both in terms of his advice and his expertise. He explained my options to me clearly and concisely enabling me to quickly make the right decision for me in the circumstance. I would not hesitate to recommend Chris or Redmans to friends or colleagues, and would certainly make Redmans my first port of call should I require a similar service in the future.

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Patient and thorough advice given to me around my Settlement Agreement

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