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In this article specialist employment solicitor Chris Hadrill answers the question: “what claims can be settled by a settlement agreement?”

Generally, the main purpose of a settlement agreement is to commit the employee to waive certain claims which may arise from their employment or the termination of their employment. Broadly, the claims that an employee may have as a result of their employment or the termination of their employment are as follows:

  • Statutory claims: for example, claims for unfair dismissal, discrimination, harassment or victimisation (amongst others);
  • Contractual claims: claims for breach of contract/wrongful dismissal;
  • Tortious claims: for example, a claim for personal injury;
  • Pension claims: a claim in respect of the employee’s accrued pension with their employer

Statutory claims

Statutory claims are generally the most common form of claims that an employee may try and assert against their employer – the most common types of claims settled are generally claims for unfair dismissal, constructive dismissal, discrimination, and harassment.

Some statutory claims do not need a specific form of waiver (for example. a claim under the Protection from Harassment Act 1997), but employers normally prefer to obtain a specific form of waiver (via a settlement agreement) in order to obtain certainty that all types of claim are being settled.

Contractual claims

A contractual claim is a claim for breach of a particular contract – this could, for example, be a breach of a contract of employment, a breach of a share scheme, or a breach of share option agreement.

An employee can enter into a valid settlement of any contractual claims (for example, a claim for wrongful dismissal) as long as the employee receives “valuable consideration” for the waiving of their particular contract claim.

 

Personal injury claims

The employer will commonly want the employee to settle any personal injury claims that they are aware of, but the employee will generally be able to bring claims for personal injury that they are not aware of (and could not reasonably be aware of) as of the date the settlement agreement is completed.

Pension claims

It is not possible for an employee to waive any accrued pension rights at their employer save in certain limited circumstances.

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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I was in contact with Chris and then worked with Caroline on an employment matter. I was very pleased with the service and professionalism throughout, and came away with satisfied with the outcome. Would happily recommend.

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Nikki

Received advice re employment law. Chris was very helpful and advised accordingly. Would happily recommend them and if ever I need help again, will not think twice before using them.

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Samantha K

Absolutely brilliant thank you. Caroline Lewis is a legend

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The legal advice was clear and helpful.

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Good Service

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I was using Redmans services for a Settlement Agreement. Very quick and professional service. The outcome was favourable and I was very pleased with the amendments and results. Pretty glad to recommend them for any type of legal advice.

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Chris was always prompt to help me with legal matters that are beyond my comprehension and very helpful leasing with my former employer. I would recommend Redmans Solicitors to everyone who needs help.

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