on your side

Advice prior to signing employment compromise agreements

Being told you are redundant from a job you either love or need – or both – is a horrible feeling but one of the ways in which the employment law solicitors of George Ide LLP can help in this situation is to advise an employee on the implications of employment compromise agreements.

This relatively new legal document is being offered increasingly by employers as a means of setting out the amount of redundancy pay you will receive but, in exchange, you agree not to pursue any claim you may have against your former boss at a future employment tribunal.

Apart from pay, it may also cover other aspects of ending employment such as length of notice. An important aspect from the employer’s point of view is that signing the agreement means the former employee agrees not to disclose any of the employer’s trade secrets or other confidential information about which he might have knowledge.

The ex-employee will also agree not to make public criticism of his former employer once he has left the business or reveal the details of the compromise agreement itself.

The agreement is legally binding upon both sides, however, you do not have to sign the document which is offered but this may mean that only the minimum Government guidelines on the amount of redundancy pay will be paid which is likely to be lower than in the compromise agreement.

Not signing the compromise agreement means that the ex-employee is free to go to an employment tribunal to make a case for unfair dismissal or unfair selection and seek a compensation payment.

Before signing a compromise agreement, you are obliged to seek the advice of an independent employment solicitor or other person who has had legal training so that all the implications of the conditions can be explained. The lawyer must counter-sign the agreement to show that advice has been given.

George Ide’s experienced employment solicitors will know if the terms offered are reasonable and often the amount of financial settlement can be increased by negotiation. Because it is a legal obligation for the employee to have a lawyer, the employer will pay the fees.

Non-redundancy compromise agreements

An employer may ask an employee to sign a compromise agreement in a non-redundancy situation. This usually relates to keeping confidentiality of the employer’s business secrets and reinforces the terms of an employment contract.

An ex-gratia payment will be offered in exchange but the same rules apply as in redundancy cases regarding independent advice and the fact that signing the agreement is voluntary.

Our sympathetic and commercially-aware employment law solicitors at George Ide can help you understand compromise agreements and ensure you are not disadvantaged. Contact us today for expert legal advice you can trust. To contact a solicitor directly, please click on the partner profiles or use the phone numbers provided.