Settlement Agreements Archives

Top 8 things that should be included in a settlement agreement to make it rock solid

things included in a settlement agreement

If you’re reading this post, you’re probably thinking: What should be included in a settlement agreement?

It’s a good question, and it’s one we’re going to answer in good detail – but first, let’s start with the basics.

What is a settlement agreement?

A settlement agreement is where an employee gives up their right to sue an employer after they leave. Usually they are not leaving voluntarily. A settlement agreement includes the details of the payment the employee will receive when they leave, leaves their role, often as part of a redundancy.

After everything is agreed on the employee’s exit, they will not be able to bring a case to an employment tribunal for any reason, including discrimination.

It’s an important agreement for a lot of reasons, which is why it’s super important that you include everything in your settlement agreement to stop your employee suing you after they have left.

What is a reasonable settlement agreement?

What is a reasonable settlement agreement?

If you’re reading this, chances are you want to find out more about settlement agreements; and more importantly – what is a reasonable settlement agreement?

You might want to know what a reasonable settlement agreement might be in your particular situation.

And you also might want to know what your next steps could be to try and solve your current problem.

Settlement Agreements

It is difficult sometimes to get rid of an employee. The law requires you go through a process that sometimes can be very lengthy. There is a quicker way to do this: settlement agreements.

What is a settlement agreement?

A settlement agreement is the name of an agreement that can be a very neat and tidy, albeit sometimes expensive way to part company with an employee. It is an agreement where you give the ex-employee money, and they agree not to sue you.

You can use a settlement agreement at any time in the employment relationship, whether there is already a dispute (disciplinary, grievance) or not (they are just not suitable for the role, but you know they will kick off if you try to dismiss them).

Why would I need a settlement agreement?

The aim of a settlement agreement is to part company quickly whilst you take away the employee’s ability to sue you at employment tribunal, for almost anything related to their employment.

For them to give up this right, you have to give them money. The settlement agreement sets out clearly what monies they will get, and what rights to sue you they have given up.

Your invalid agreement

We’ve had a rash of settlement agreements to draw up recently.

Usually, we’re asked to do these because the business doesn’t want to go through a lengthy redundancy process before possibly parting company.

However, the struggle is usually getting the business to understand that they are not just paying the employee their notice to go.

They have to pay them more than that (sometimes much more) as they’re actually paying them for giving up their right to sue the business.

And you have to pay tax and NI on notice periods, even under a settlement agreement.

So, to work out how much you should be paying, as a minimum, you need to pay them their notice period PLUS what they would have got if they had been made redundant PLUS a sum for giving up their right to sue you.

This only works as a ballpark figure if we are talking about unfair dismissal – if it’s discrimination, then you really need to be willing to offer at least one year’s pay.

Filling the GAP in HR Services: Settling down

Filling the GAP in HR Services: Settling down

As you might expect, we’re very busy at the moment.

Clearly, we’re heavily involved in several restructuring projects, but we’re also dealing with long-term sickness absences and a few – believe it or not – disciplinary processes.

One of our key roles in all people management issues is to ensure our clients follow all the correct processes, and if they do, they give themselves the very best chance of being protected.

We can’t stop an employee starting a tribunal, especially now they’re free.

But by making sure a fair and reasonable process is followed, we minimise the danger of an ambulance chaser solicitor seeing pound signs when they hear what has been going on.

In 95% of the processes we carry out, just following the correct process and guidelines is enough to make sure that there is no Early Conciliation or tribunal claim.

But for the other 5% we have an ace up our sleeve – settlement agreements.

What is a “settlement agreement”?

Filling the GAP in HR services: Automatically unfair

Filling the GAP in HR services: Automatically unfair We had a call from a company the other day who’d received an Early Conciliation claim for their apprentice. They’d spoken to ACAS, who’d told them they had no choice but to pay it, but – not really happy with that advice – they’d turned to us … Read more

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 05/12/2023
 
 
 
 
     I absolutely enjoyed my recent experience working with Gap HR. There are several aspects of their service that stood out to me. Firstly, their responsiveness is truly remarkable. Gap HR consistently demonstrated the fastest response time to all our communications, which not only streamlined our processes but also instilled a sense of confidence in their support.

Secondly, their expertise in HR solutions for medium and small businesses is unparalleled. Gap HR's in-depth knowledge and experience in this niche are highly valuable. Their ability to navigate the complexities of HR for smaller enterprises is a significant asset and brings peace of mind.

Lastly, the team at Gap HR is an absolute pleasure to work with. Their caring and dedicated approach goes beyond the ordinary, making them not just service providers, but trusted partners. They bring a level of commitment that is truly exceptional, and it's evident that they genuinely care about the success and well-being of their clients.

In summary, Gap HR has become our first and foremost point of contact for any employment law support. Their combination of responsiveness, expertise, and unwavering dedication makes them an invaluable resource in the realm of HR and employment law.
     
   Alisa Tolmaciova 
 07/11/2023
 
 
 
 
     I work for a local council and we began working with Gap HR a few months ago. I have found them an absolute pleasure to work with - very responsive, thorough and knowledgeable. Above all I feel that I am working with a friendly and empathic team who understand our needs and are dedicated to helping us achieve what we need to achieve. I am very grateful to have their support.
     
   Claire Bird 
 11/10/2023
 
 
 
 
     GAP HR has been supporting our business for a while now and they are very helpful and thorough in everything they assist us with, from the small to big issues.  Great company to support your business.  All staff are friendly and on point with all the knowledge they share.
Thank you GAP-HR
     
   Neath Afan Gymnastics And Activities 
 15/09/2023
 
 
 
 
     It has been great working with Gap HR, their guidance has helped immensely with the day to day running of the business.  The whole team are extremely responsive and knowledgeable which makes the experience a pleasurable one.
     
   Will Cairns 
 27/06/2023
 
 
 
 
     Great support from the whole team. The knowledge, advice and support that Gap HR give is second to none. They give me the confidence to know that i am doing the right thing. 👍
     
   Jeff Wicks 
 06/06/2023
 
 
 
 
     We are really delighted to have hooked up with Gap HR Services Limited – the team interpreted our brief perfectly and their advice and assistance was delivered in both a pragmatic and professional way. A big THANK YOU to both Carolyne and Cathy who steered us through the legislation with a best practice and smart approach.

Gap HR’s sense of urgency in fulfilment and delivery matched our own so we can do nothing but positively recommend the team for your HR needs.
     
   BCAS Ltd 
 28/04/2023
 
 
 
 
     We receive excellent advice and service from the team at Gap. Professional, but helpful with any question big or small. They save us from many hours of debating if we should do x or y - just email Gap is the answer, which makes it easy for us and minimises mistakes - thank you Gap HR!
     
   Jacqueline Shields 
 24/04/2023
 
 
 
 
     Brilliant company and I highly recommend their services, professional HR services.
     
   Robert Creer 
 13/01/2023
 
 
 
 
     I have been using GapHR for many years and find them a great company to work with. All of the team I have worked with are very professional and experienced in many areas. I would highly recommend using GapHR as there services are fantastic.
     
   Tommy Fisher 
 11/01/2023

Who We Work With

It is great having Gap HR working with us for all our HR. Brilliant company.

Nick Jobson

05/12/2023

I absolutely enjoyed my recent experience working with Gap HR. There are several aspects of their service that stood out to me. Firstly, their responsiveness is truly remarkable. Gap HR consistently demonstrated the fastest response time to all our communications, which not only streamlined our processes but also instilled a sense of confidence in their support. Secondly, their expertise in HR solutions for medium and small businesses is unparalleled. Gap HR's in-depth knowledge and experience in this niche are highly valuable. Their ability to navigate the complexities of HR for smaller enterprises is a significant asset and brings peace of mind. Lastly, the team at Gap HR is an absolute pleasure to work with. Their caring and dedicated approach goes beyond the ordinary, making them not just service providers, but trusted partners. They bring a level of commitment that is truly exceptional, and it's evident that they genuinely care about the success and well-being of their clients. In summary, Gap HR has become our first and foremost point of contact for any employment law support. Their combination of responsiveness, expertise, and unwavering dedication makes them an invaluable resource in the realm of HR and employment law.

Alisa Tolmaciova

07/11/2023

I work for a local council and we began working with Gap HR a few months ago. I have found them an absolute pleasure to work with - very responsive, thorough and knowledgeable. Above all I feel that I am working with a friendly and empathic team who understand our needs and are dedicated to helping us achieve what we need to achieve. I am very grateful to have their support.

Claire Bird

11/10/2023

GAP HR has been supporting our business for a while now and they are very helpful and thorough in everything they assist us with, from the small to big issues. Great company to support your business. All staff are friendly and on point with all the knowledge they share. Thank you GAP-HR

Neath Afan Gymnastics And Activities

15/09/2023

It has been great working with Gap HR, their guidance has helped immensely with the day to day running of the business. The whole team are extremely responsive and knowledgeable which makes the experience a pleasurable one.

Will Cairns

27/06/2023

Great support from the whole team. The knowledge, advice and support that Gap HR give is second to none. They give me the confidence to know that i am doing the right thing. 👍

Jeff Wicks

06/06/2023

We are really delighted to have hooked up with Gap HR Services Limited – the team interpreted our brief perfectly and their advice and assistance was delivered in both a pragmatic and professional way. A big THANK YOU to both Carolyne and Cathy who steered us through the legislation with a best practice and smart approach. Gap HR’s sense of urgency in fulfilment and delivery matched our own so we can do nothing but positively recommend the team for your HR needs.

BCAS Ltd

28/04/2023

We receive excellent advice and service from the team at Gap. Professional, but helpful with any question big or small. They save us from many hours of debating if we should do x or y - just email Gap is the answer, which makes it easy for us and minimises mistakes - thank you Gap HR!

Jacqueline Shields

24/04/2023

Brilliant company and I highly recommend their services, professional HR services.

Robert Creer

13/01/2023

I have been using GapHR for many years and find them a great company to work with. All of the team I have worked with are very professional and experienced in many areas. I would highly recommend using GapHR as there services are fantastic.

Tommy Fisher

11/01/2023