Compromise Agreements

Video: Geoff Bignell answers some key questions on Compromise Agreements.

We are specialist Compromise Agreement Solicitors and can help you regarding a Compromise Agreement, wherever you are in the U.K.

A compromise agreement is a binding contract between an employee and an employer which takes away the employee’s rights to make a claim in a court or tribunal. In exchange, the employer promises various payments, usually beyond what the employee is legally entitled to. The agreement will deal with the notice period, or pay in lieu of notice, and provide termination payments, which may be free of tax to £30,000. If the employee prefers, any taxable payment can often be diverted to a pension fund, free of tax.

“Your professional services are so good.” - Mr J H, HR Director

Employers often offer a compromise agreement just before or after termination of an employment contract, to avoid the risk of tribunal claims.

The benefit of a compromise agreement is that it settles actual or prospective claims, generally without any court or tribunal proceedings being started. Compromise agreements are also used to settle tribunal claims in progress before a final judgment (although ACAS will often help with settlements without the need for a compromise agreement).

A compromise agreement, to be valid, must comply with Section 203 of the Employment Rights Act 1996. This requires that an employee takes independent legal advice before signing the agreement.

Compromise Agreements for Employers

We can advise and prepare you with compromise agreements which are tailor-made for your specific needs.

“Thanks for acting so quickly in preparing the documentation.” – Ms JP, Finance Director, Distributor, Hampshire

Compromise Agreements for Employees

The employer invariably pays a contribution to the cost of this legal advice. Agreements vary in complexity. Solicitors normally charge between £250 and £1,000 (plus VAT) for advising an employee on a compromise agreement. If negotiations are required, the cost may be more. We aim to work for employees within the sum allocated in the agreement. If this is not sufficient, we can often negotiate a higher sum.

“Thank you personally and Just Employment for your advice, expertise and support with this process.” – Mr ST, Bognor Regis

If you are unhappy with the terms of the compromise agreement, we can help negotiate a better package. ‘If you don’t ask you don’t get.’

As specialist Compromise Agreement Solicitors we can help you. Please call us now.