Settlement Agreement Assistance
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A settlement agreement is a legally binding contract between you and your employer, usually offered when your employment is ending, in which you agree to waive your right to bring certain claims (such as unfair dismissal) in exchange for an agreed payment and, often, a reference.
For a settlement agreement to be legally valid, you must receive independent legal advice from a qualified adviser before signing, this is a legal requirement, not just good practice, and protects you from being pressured into an unfair deal. Your employer will typically contribute towards this advice.
Sharper Labs Legal reviews the financial and non-financial terms of your settlement agreement, explains the tax treatment of any termination payment, and negotiates improvements where the offer does not reflect your circumstances, before signing off the agreement so it can take effect.
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How we can help with settlement agreement assistance
- Independent legal advice, a legal requirement before signing
- Reviewing the financial terms on offer
- Negotiating enhanced settlement terms
- Understanding the tax treatment of termination payments
- Reviewing references and confidentiality clauses
- Same-day advice certificate where timescales are tight
Other advice for employees
Settlement Agreement Assistance, frequently asked questions
Everything you need to know about this topic.
It is a legally binding agreement where you agree to waive your right to bring certain employment claims in exchange for a payment, and usually a reference, from your employer. It is commonly used when employment is ending by mutual agreement.
Yes. For a settlement agreement to be legally valid, you must receive independent legal advice from a qualified adviser, such as a solicitor, confirming you understand the terms and effect of the agreement.
Typically, yes. Employers usually offer a contribution towards your independent legal advice as part of the settlement package, this is standard practice and is separate from your termination payment.
Often, yes. Settlement terms, including the payment amount, reference wording and timing, are frequently negotiable. We regularly negotiate improved terms on behalf of employees before advising you to sign.
Termination payments up to £30,000 can often be paid tax-free, but this depends on how the payment is structured and what it relates to. We explain the likely tax treatment as part of our advice on your agreement.
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