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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

    4.81 Average

    314 Reviews

    Anonymous

    I'd highly recommend Redmans Solicitors. Mel was very helpful and assisted me throughout my case.

    Posted 1 day ago

    Anonymous

    Sacha was very thorough and very helpful, with great advice on when to act and when to wait on my case.

    Posted 4 days ago

    Anonymous

    I have been very pleased with the support I got from Redmans Solicitors on my case with my employer. Caroline has always helped me to put things in perspective and showed me different scenarios ultimately to help me taking the right decision. She was very professional and always available when I needed, and at the same time also emphatic which I found also really important to establish a strong relationship. Will definitely recommend!

    Posted 6 days ago

    Anonymous

    Prompt and efficient response to my enquiries. Excellent negotiating skills with my employer which considerably improved the terms of my settlement agreement.

    Posted 6 days ago

    Anonymous

    Very quick and professional service , Rana was very helpful

    Posted 1 week ago

    James G

    Very professional, knowledgeable and kept me informed at every stage of my case. I would highly recommend Redmans.

    Posted 1 week ago

    Pravina P

    Chris was really good and help solve my issues with current company. I would recommend him to anyone.

    Posted 2 weeks ago

    Paul L

    Sacha was extremely helpful in my matter. I would not hesitate you use Sacha or Redmonds again. Everyone was very helpful.

    Posted 2 weeks ago

    Monique N

    I had Mel Chin helping me with a settlement and she was very professional and reliable throughout my case. Mel provided me with a good understanding of what was happening and gave suggestions on routes I could take. My case was resolved and closed promptly although the opposing side were very difficult to deal with. A very big thank you to Mel and Chris.

    Posted 2 weeks ago

    Jackie C

    My first ever experience needing the services of a solicitor; cannot speak highly enough of Mel and Chris’s personable, reassuring and straight to the point advice in dealing with my settlement agreement. They put me at ease during an extremely stressful time. I am equally as happy with the outcome, as l am their professional services.

    Posted 3 weeks ago

    ""

    Really happy with the service. All very efficient. Mel rattled through things very fast, however was great whenever I needed to stop and ask a question! Would definitely return to Redmans if I ever needed Legal advice.

    Posted 3 weeks ago

    Peter F

    Very helpful and clear advice, would highly recommend.

    Posted 4 weeks ago

    William A

    Second time I have had to use Redmans. They did not disappoint. They are fast , efficient and friendly. I have already recommended them to friends and colleagues. I hope I dont have to use them again but if I have to , they are the solicitors for me.

    Posted 4 weeks ago

    Fleeta C

    Great service with tantastic communications. The solicitor responsible is extremely knowledgeable and was responsible for bringing a timely and desired solution.

    Posted 4 weeks ago

    Veronica M

    Extremely helpful, starting from a request for advice at very short notice, to dedicating time for me to understand and review all documents thoroughly.

    Posted 4 weeks ago

    Sophie R

    Very efficient and professional service. Chris was very empathetic, knowledgeable and personable. Highly recommended.

    Posted 1 month ago

    Melanie M

    Very happy with the detailed advice provided from Redmans. They also helped me to secure a higher settlement than originally offered by my employer and were extremely diligent. I first spoke with Chris at relatively short notice and then Sacha dealt with my case. Would definitely recommend and use again in the future if needed.

    Posted 1 month ago

    Anonymous

    Redmans helped me with a work related issue, which was resolved quickly and professionally. I would definitely recommend this company.

    Posted 1 month ago

    James F

    Great people, really friendly and professional helped with everything that I needed.

    Posted 1 month ago

    Anusha S

    My case was handled by Sacha who was very thorough and helped me to achieve a good outcome with my employer. Sacha was very personal, professional and helped me during quite a stressful time, so I am hugely grateful to her and to Redmans. This was my first time engaging with a law firm so I wasn't sure what to expect but I can definitely say that it was a good experience overall and I ended up better off due to having the help of an experienced and proactive solicitor on my side.

    Posted 1 month ago

    Diane P

    So grateful that I contacted Redmans to deal with my Redundancy Agreement. Everything from the initial call to the completion of the matter was professional, efficient and effective. I was listened to, had everything explained simply and kept informed of every step. I received super advice and the costs were very competitive. I would highly recommend them to anyone seeking similar help. First class service - thank you

    Posted 1 month ago