Discrimination Settlement Agreements

Discrimination Settlement Agreements

Discrimination settlement agreements (formerly known as compromise agreements) are agreed out-of-court a lot more often than discrimination employment tribunals are won in court. Unfortunately discrimination at work is still rife in Britain – even if it is out of sight, it is certainly not out of mind – but discrimination claims can be difficult to prove.

Pregnant woman experiencing discrimination

On the plus side, there is no minimum period of employment for you to be able to claim in the employment tribunal for discrimination. For example, you could claim after only being employed for one day. If you want to find out quickly how much your discrimination claim could be worth, try our free Settlement Agreements Calculator.

If you want to understand a bit more about how much to ask for in your discrimination settlement agreement, it is necessary to contextualise it by understanding how a discrimination claim would be dealt with in an Employment Tribunal. Why? Because most employers will ask their lawyers the question ‘if this went to tribunal what would happen?’ They would then base any settlement agreement offer on their lawyer’s answer.

Time Limits in discrimination claims

You only have three months to issue an employment tribunal claim for discrimination.

The clock starts ticking after the incident, or course of events, in question (unless you can show it was reasonable in all the circumstances to wait). If you miss the time limit, the Tribunal can reject your claim, unless they decide that it is “just and equitable” to accept it. So you need a jolly good reason for waiting so long.

Deadline for application

For this reason your employer will be less likely to offer you a decent settlement agreement if you have waited too long. Employers will often try to string out any grievance procedure to take you over the 3 month time limit for issuing a claim! See our article explaining time limits in employment claims for more details.

Types of discrimination

There are several types of discrimination, under the Equality Act 2010 and under the old law:

  1. Race (including ethnic or national origin, nationality and colour)
  2. Religion or Belief
  3. Sex (including gender, sexual orientation, sexual reassignment)
  4. Age
  5. Disability (including any impairment which could affect you for over 12 months)
  6. Pregnancy (including maternity)
  7. Marital Status (including civil partnership)

Top 3 TIPS

  1. Get witnesses
  2. Keep a diary
  3. Gather relevant statistics

Proving a discrimination claim

Discrimination claims can be difficult to prove as there is normally no written evidence and of course the perpetrators are likely to deny all knowledge. They can be the highest value claims however, because there is compensation available for injury to feelings.

If you have been put at a disadvantage because of one of the above types of discrimination, either directly or indirectly, then you may be able to make an employment tribunal claim. If you’ve been discriminated against at work, you should seek legal advice, because these types of claims are complicated, even for lawyers (and that includes judges!).

Discrimination settlement agreements – how much money should I get?

In order to calculate how much to try to negotiate in your settlement agreement, you need to have regard to what you could claim for in the Employment Tribunal. In discrimination tribunals you can claim for:

  • Injury to Feelings
  • Financial Loss
  • Personal Injury

The financial loss element is based on the same principles as for unfair dismissal, although it unlimited rather than being capped at around £80,000 which is the limit for normal unfair dismissal claim in the Tribunals. This is limited to the amount of money you lost whilst out of work – so if you got another job straight away on the same or more money, then you have suffered no financial loss.

Personal injury is based on the same principles as for say a car accident, although the kinds of injuries most common in employment matters are psychological injuries such as depression and similar disorders. Compensation is theoretically unlimited but in practice it’s tightly pegged to the type of injury caused, and its very difficult to prove. Obviously medical evidence is necessary here, and you have to somehow show that the employer’s conduct was the only cause of your condition, and that they should have known about it in advance too.

Injury to feelings is not claimable in unfair dismissal, but it is for discrimination claims. Guidelines amounts of compensation were set out by the Court of Appeal in the ‘Vento’ case, and these guidelines are as follows:

  • Band 1: 600 – 6,000. [one off / isolated incident] – this is the most common award by far;
  • Band 2: 6,000 – 18,000. [more serious discrimination]; and
  • Band 3: 18,000 – 30,000. [sustained campaign of the most serious discrimination – rare].

The very large payouts which tend to be in the media are often due to financial loss whereby the discrimination meant that the individual could not work again. If, for example, you were earning £40,000 per year, and you are 65 years old, you might be able to claim 5 years salary totalling £200,000, if you can show that you are unlikely to find another job. Or if the discrimination really set you back psychologically, and you have medical evidence to support this, you may be able to claim for years’ worth of compensation.


Next steps

If you want to talk to an experienced employment solicitor about the details of your case, and find out how we could help you improve your settlement package. Get in touch on 020 7717 5259, 0800 533 5134 or apply for a free 15 minute consultation.