Settlement Agreements – Advice for Businesses

What is a settlement agreement and when should your business consider using one?

Simply put, a settlement agreement is a legally binding contract between an employer and employee that agrees certain terms to end the employment contract whilst also settling any claims the employee may have had against the employer.

Settlement agreements should only be used in situations where there are potential or existing claims and/or workplace disputes to be resolved between both parties. The settlement agreement must be executed properly so that any risk of future claims being made against the employer are removed and the matter can be closed. Employers should not rely on oral or email correspondence as a replacement for a settlement agreement which is more extensive and seeks to protect the employer from any further claims and tribunals.

Why use Rothera Bray for your settlement agreement?

We believe it’s essential for your solicitor to have an in-depth knowledge of your business, the environment it operates in, and the circumstances for which the requirement for a settlement have arisen. At Rothera Bray, our employment solicitors have experience advising employers across many sectors, including: retail, leisure and hospitality, transport, communications and construction.

Our team can help at every stage of the process:

• the initial stages of advising on whether a settlement agreement is necessary
• negotiation of the contract terms, and
• preparation of the settlement agreement to bring your matter to a full conclusion

Employment expertise is particularly beneficial throughout the negotiation process. It can result in cost saving benefits where you are seeking to prevent the other party’s solicitor needlessly inflating the settlement value for their client.

Where we can help your business with settlement agreements

• We can help your business at every step of the settlement agreement process
• We can advise on whether a settlement agreement is the right course of action for your situation
• We can assist in drafting the settlement agreement also ensuring that restrictive covenants – agreements that protect ex-employees from working with competitors, taking business contacts or work away from your business and/or taking employees – can be enforced where necessary and your business remains protected
• We can liaise with the other party’s solicitor on your behalf to negotiate the amount offered on the settlement agreement
• We can advise on stipulations to be put in place to prevent any future litigation claims
• We can advise on future policy, training or contract drafting to avoid similar circumstances in future

We can also help with:

• Redundancy and Restructuring
• Termination of Contract
• TUPE
• Grievances
• Employment Dispute Resolution
• The Employment Rights Act 2025
• Senior Executive and Director Issues
• Breach of Contracts