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In the last year many businesses have struggled to cope with turbulent economic conditions and a rapidly-changing legal and economic environment. One option for dealing with these circumstances is downsizing your workforce or restructuring your business. If you’re looking to make a number of employees redundant then you may wish to consider settlement agreements for your employees: they’re an efficient, clear and amicable way of terminating the employment relationship with an employee, and in return you will have the certainty that the relevant employees will be waiving their right to bring employment-related claims against you.

We have provided below our top tips for employers on how to deal with a group settlement agreement process

Why do I need to get my employees to take independent legal advice on their settlement agreements?

If you’re undertaking a group redundancy exercise (or dismissing a group of employees for any other reason) then you may wish to consider offering the relevant employees a settlement agreement. If you’re offering employees settlement agreements then you will need to make sure that the employees are receiving independent legal advice (in addition to other requirements) to ensure that the settlement agreements are valid.

If you’re seeking more information on a settlement agreement then you can consult our guide on settlement agreements or the ACAS Code of Practice on Settlement Agreements.

Do I need to cover the cost of my employees receiving advice on their settlement agreements?

It is not legally required but it is usual for the employer to make a contribution to the employee’s legal fees, since one of the statutory conditions for a settlement agreement is that the employee has received legal advice. The going rate may vary depending on locality and complexity, although most are approx. £500 plus VAT.

What approach should I follow if a number of employees in my business are receiving settlement agreements?

If a number of employees (usually five or more) are seeking advice from an independent legal adviser on their settlement agreements then we would normally recommend running a group exercise to deal with the settlement agreements.

Our employment law team has a huge amount of experience dealing with settlement agreements, providing independent legal advice to both employers and employees. We have managed a number of large volume settlement agreement exercises in time-critical situations and we have a record of dealing with settlement agreements professionally and expediently.

If you’re undertaking a settlement agreement group exercise then we would recommend undertaking the following steps to make the process as painless and efficient as possible:

  1. Digitise the process: use emails, word documents and pdfs to distribute documents electronically – doing this will reduce the amount of time that it will take to complete the process and will allow a clear audit process as to which documents were sent and when
  2. Use electronic signatures: using electronic signatures has a number of advantages: it makes the process of completing the settlement agreement much swifter, allows for an audit trail of the agreement, and generally allows the settlement agreement to be completed the same day as the terms are agreed
  3. Set timeframes for the work being done: be clear about your expectations as to when employees should take advice and send their settlement agreements back. As with any project management exercise its a good idea to set clear guidelines as to what work has to be done and when
  4. Agree a template settlement agreement: agree a template of the settlement agreement internally and pre-approve what standard amendments can (and can’t) be made to the agreement – this will avoid disparities in the completed settlement agreements and allow your team to have a clear understanding of what amendments might be allowed and what won’t
  5. Give your employees a reasonable amount of time to receive advice on the agreement: under the ACAS Code of Practice on Settlement Agreements employees should have up to ten working days to receive legal advice on their settlement agreements – it’s normally good practice to follow these guidelines (even if they’re not legally binding) to avoid an argument at a later date that the settlement agreements are not binding
  6. Provide breakdowns of terms to the employee and their solicitor: be clear from the start on what is being offered and why – this will save time on clarifying points in the future
  7. Be firm on legal fees: be clear on how much is being offered in terms of legal fee coverage to the employees – this will set clear expectations for each employee on what their relevant budget is, and will avoid an escalation in the budget set for dealing with the settlement agreement process
  8. Use telephone conferences and online meetings: use telephone conferences and virtual meetings (as well as email communications) to ensure that regular updates are given and received on each settlement agreement
  9. Prepare in advance: as in any legal exercise, planning and preparation are key to achieving a desired outcome. The more work that you can do in advance, the fewer problems you will experience in the process – fail to prepare, prepare to fail

Our specialist team of employment law solicitors can help you deal with your settlement agreement issues. If you’re preparing to go through a group settlement agreement exercise then call one of our legal advisers in order to ensure that your employees are getting the independent legal advice on their settlement agreements. We can also help you with drafting the template settlement agreement to use for your employees. Just call us on 020 3397 3601 or use our enquiry form and we’ll call you back.

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. Redmans have offices in Richmond, Chiswick, Hammersmith, Fulham, Kingston, Wimbledon, Ealing, Kings Cross and Marylebone (meetings strictly by appointment only).

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    Testimonials

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    371 Reviews

    Jonathan L

    The service I received was friendly and professional. I appreciated the timely communications and Mel was always available for any questions I had. I'd definitely recommend Redmans and will use them in a heartbeat should the situation arise again.

    Posted 6 days ago

    Glyn B

    Provided a great service, covered all my requirements

    Posted 1 week ago

    Fidel A

    Redmans Solicitors recently helped me navigate a recent employment termination settlement agreement. Chris Hadrill is very professional and you will be in good hands with him. I score Redmans 4 out of 5 because things had to move fast and felt the team member assigned to my case wasn't very responsive at times. Having said that, I was very happy with the outcome and have no hesitation in recommending their services.

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    Nigel A

    Chris Hadrill is hugely impressive - the right blend of assured calm and savvy professionalism. I've already recommended him to friends and family.

    Posted 1 week ago

    Matt O

    I was hugely impressed with the ease of being able to work with Redmans Solicitors and their professional approach. Mel was really clear around the process, and costings required and I felt comfortable throughout. I would certainly recommend.

    Posted 1 week ago

    Bryan G

    Great response, and also happy to assist

    Posted 1 week ago

    David L

    I was made a settlement offer by my employer to terminate my emplyment early. Redmans helped me understand the offer, and ensured that it was fair for someone in my position. They made a very stressful situation much easier. Excellent service.

    Posted 1 week ago

    Anonymous

    I can highly recommend Redmans. The service was professional and prompt and I would not hesitate to use them again. Thanks

    Posted 2 weeks ago

    Anonymous

    Overall I am satisfied with the performance from Redmans. The reason I have given 4 stars is that I had quite a lot difficulty in contacting the representative which was initially nominated for me. However, when I contacted Chris instead, he was excellent over the phone and secured a great outcome in short order. I would recommend Redmans Solicitors.

    Posted 2 weeks ago

    Anonymous

    Chris and Redmans were a great help. Effective and efficient, quick response from my first enquiry and then straightforward and attentive throughout with ultimately a positive outcome. I will use them again and recommend them.

    Posted 3 weeks ago

    Marie P

    Great service, quick responses, good advice and all in a no nonsense, no jargon manner. Would definitely recommend.

    Posted 3 weeks ago

    Anonymous

    Rana was amazingly thorough and professional!

    Posted 3 weeks ago

    Anonymous

    I am extremely happy with the legal advice I was provided with. My case was resolved to the best of my expectations. Thank you very much for your professional help.

    Posted 3 weeks ago

    Shahzad R

    Chris and his team were excellent. They provided sound advice and consultation that resulted in more cash than was offered. Would definitely recommend.

    Posted 3 weeks ago

    Sanjay B

    I would like to take this opportunity to thank Mel Chin, for all her support during my settlement process. Where she provided a professional service and was understanding. I would confidently recommend Redmans Solicitors to my friends and family. Thank you and wishing you all a Merry Christmas.

    Posted 1 month ago

    Paul O

    Excellent response time and communication during my dealings with Redmans

    Posted 1 month ago

    Gil T

    I don’t normally write reviews, but thought it was time on this occasion. Just wanted to say that I highly recommend Redmans - especially Rana Tandon, who helped me navigate around my employment contract. Rana was meticulous and thorough and all over my needs. Would I use Redmans again ? ..absolutely

    Posted 1 month ago

    Stephanie D

    Very thorough and professional service. I was very nervous about my employment case, as I had never dealt with anything like it before. However, the solicitors who handled my case made sure I understood everything. I was never kept in the dark and Redmans kept me constantly informed about what was going on with my case. I would definitely recommend Redmans Solicitors

    Posted 1 month ago

    Richard S

    Chris and Sacha were great throughout the entire process. Chris was very helpful once the initial discussions with my company began and before we agreed there was a case. Sacha was very responsive, patient and helpful throughout ensuring I felt I had the right information to make the best decision on next steps. A close friend and wife have both used Redmans in the past few years for unfair dismissals and the service continues to be first-class and I would strongly recommend them again. They definitely help reduce the anxiety that comes with uncertainty around new processes and situations. Thank you!

    Posted 1 month ago

    Jianya

    Very nice and patient went through the whole document with me.

    Posted 1 month ago

    Susan L

    Very helpful and led me through the redundancy process.

    Posted 1 month ago