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Chris Hadrill, a specialist employment solicitor at Redmans, answers the question:

“Is it fair for my employer to offer me a settlement agreement as an alternative to dismissing me for performance-related reasons?”

The question of whether it is ‘fair’ for your employer to offer you a settlement agreement is, almost exclusively, yes – there is generally no prejudice caused to an employee by the simple offering of a settlement agreement. The question here, therefore, seems to be: are the terms of settlement that my employer is offering me fair? An analysis of this question will invariably hinge upon two factors: one, the circumstances of the dismissal and, two, the terms of settlement that you are being offered.

The circumstances of your (potential) dismissal are relevant in order to assess the strength of your potential claim for unfair dismissal and, in turn, the reasonable value of your unfair dismissal claim – the higher the value of your unfair dismissal claim, the more ‘leverage’ that you will have in negotiations regarding a settlement agreement. If you are an employee and have sufficient continuous service to bring a claim for unfair dismissal (2 years from April 2012) your employer must, broadly, make a decision to dismiss you that is fair and undertake a fair procedure in dismissing you; if your employer does not take such steps then you may have a successful claim for unfair dismissal.

If your employer has concerns about your performance at work then it should generally take the following steps to dismiss you in order to avoid a successful unfair dismissal claim: any minor concerns should be dealt with through day-to-day management and, with regards to any formal concerns about your performance it must undertake an assessment to determine whether any formal capability procedure is necessary; it must (among other things) inform you of the reasons why it believes that you are allegedly underperforming; and allow you to comment on any alleged underperformance at a formal capability meeting. Your employer should also provide you with reasonable training to allow you to improve your performance, undertake regular reviews of your performance with you, and give you a reasonable time period in which to improve.

Your employer may, prior to the start of the capability process, during the capability process, or after the conclusion of the capability process, offer you what is known as a “settlement agreement”: this is a contract (regulated by statute) by which you generally agree not to pursue certain claims against your employer in return for various benefits (financial or otherwise). Whether the terms of the settlement agreement are fair must generally be measured by two considerations:

  1. Whether, from the perspective of your legal adviser, the value of the financial compensation and other terms of the agreement are reasonable, taking into account the circumstances of your case; and
  2. What you wish to derive from the settlement process

It you have been offered a settlement agreement and are researching whether what you have been offered is fair (and have therefore come upon this article) it is, unfortunately, not possible in this article to offer you advice on whether the terms of your specific settlement agreement are fair – it is advisable that you consult one of our solicitors (or indeed another firm of solicitors) in order to discuss the circumstances of your situation with them (your employer will normally offer to pay fees of between £350 plus VAT and £500 plus VAT for the purposes of you taking advice on the agreement). So, if you’ve been offered a settlement agreement get in touch with us by giving us a call on 020 3397 3603 or email us on enquiries@redmans.co.uk

 

About Chris Hadrill

Chris is a specialist employment lawyer at Redmans. He specialises in contentious and non-contentious employment matters, including breach of contract claims, compromise agreements and Employment Tribunal cases. He writes on employment law matters on a variety of websites, including Direct 2 Lawyers, Lawontheweb.co.uk, LegalVoice, the Justice Gap and his own blog. Contact Chris by emailing him at chadrill@redmans.co.uk

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    I found everything about the company to be extremely professional and efficient. During my initial contact with Chris, he listened well and was reassuring, so I felt confident that my case would be well handled. Caroline was excellent at explaining all the legal points and answering my questions, as well as being very supportive and understanding throughout the process. I would definitely recommend this company.

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    Excellent service, thank you so much!

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    I found Caroline and Chris very Helpful and provided excellent service. Caroline especially provided great legal advice and made me feel at ease with the whole process. I would highly recommend them. Thank you!

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    Excellent company very professional would definitely recommend

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    Alex K

    Redmans provided an excellent service, timely and effective. Will definitely recommend.

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    Great job done on my employment law

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    Dominica S

    Caroline & Chris were very prompt and efficient.Very happy with the service and will definitely recommend Redmans Solicitor to everyone !

    Posted 1 week ago

    Sandra K

    If you are looking for a group of solicitors who are Professional, Caring and on point, then look no futher than Redmans. I was literally hand held through out my case. Can not find fault with this company, very happy with the result and the service i received. Would highly recommend Redmans.

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    Anonymous

    I found dealing with Redmans a pleasure. I got to speak to someone quickly, the advice was profferred promplty and the service was not 'pushy'. In addition, the administration was excellent. What more could you ask for?

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    ALISDAIR L

    Redmans did a brilliant job regarding my redundancy agreement. I miss read an extra charge which wasnt the case so doing a new review to clarify. I would recommend Redmans for any employment law issues you may have.

    Posted 1 week ago

    Christos G

    Great legal advice and quick correspondence. Very supportive and helpful through the entire process. Thank you Redmans!

    Posted 2 weeks ago

    Anonymous

    Chris Hadrill advised me on a redundancy settlement agreement. He was very responsive, easy to deal with and gave me good advice at a stressful time.

    Posted 2 weeks ago

    Zara M

    Rana at Redmans gave me support and confidence I needed to ensure a wrong, was put right. I couldn’t recommend enough.

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    Stuart T

    Chris provided an excellent service, he was efficient and friendly and I had no doubt when recommending him to my colleagues

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    Anonymous

    Excellent service, prompt responses. Chris Hadrill provided excellent and efficient service.

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    Wonderful solicitors who really listen to you and who are there to offer expert legal advice but they also have a personal touch and you really feel supported both from a legal aspect but also from a personal aspect. They really listen .

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