A settlement agreement is a legally binding agreement between an employer and employee which sets out the basis and terms on which an employee’s employment shall be terminated. Settlement agreements used to be called Compromise Agreements. The difference between the two is little more than a name change!
These agreements are normally used when an employer wants to dismiss but accepts that there are risks in doing so and therefore usually offers an enhanced financial package to the employee.
As you the employee would be signing away any rights to present claims against your employer in the Employment Tribunal, you are required to take legal advice in relation to the terms and effect of the agreement.
Your employer should contribute towards your legal fees for obtaining such advice and we have an excellent record of obtaining good compensation packages on behalf of our clients.