As a general rule “out of court settlements” of employment disputes are not legally binding in that they cannot exclude employees’ rights to take the matters concerned to an Employment Tribunal. However, this is legitimately circumvented by entering into formal settlement agreements with the employees which fulfill certain legal requirements.
They involve an offer from an employer to an employee to agree to mutually terminate the employment relationship, usually to pay salary to a certain date, to pay part or all of the contractual notice period and often make an additional ex gratia payment as an incentive to the employee to sign. In return the employee will usually give up any right to make any claim or any future claim arising out of his employment against his employer (certain exclusions apply).
At privilege solicitors we have the experience in drafting settlement agreements. Contact us here for an initial discussion and to make an appointment or call our mobile friendly number on +44 (0) 20 3581 5678 to speak to an Employment Law Solicitor.