Finalising a settlement agreement: Guidance for employees

You may already have been offered a settlement agreement which has been the culmination of a lengthy process between you and your employer and has resulted in an offer of settlement that is acceptable to both sides.

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    What if I’m happy with my settlement agreement amount?

    It’s a legal requirement for you, as an employee, to receive independent legal advice from a qualified lawyer when you enter into the terms of a settlement agreementMost people faced with this scenario seek out a firm of lawyers who offer a ‘sign-only’ specialist service.

    Under the terms of such a service, the lawyer advises on the terms of the agreement, the effects of those terms on your future plans and on whether the level of compensation is the best deal for you in your particular circumstances.

    Who is a ‘sign-only’ service for?

    This service is suitable for you if you are satisfied with your overall settlement offer and just want advice on the terms of the agreement. Having said that, some redrafting of the agreement will usually be required so that you get maximum benefit from the terms.

    Even though the terms of the financial settlement have been agreed, it’s still a stressful experience for you if you are an employee facing termination of their employment. It’s essential therefore that the lawyer you choose to review your agreement is suitable and experienced.


    How do you choose a solicitor to sign off your settlement agreement?

    Check out the credentials and experience of the solicitor you are thinking of using.  Of course you need be able to communicate effectively with them so that you can fully understand what the terms of your agreement mean.  In addition, your lawyer needs to be:

    • An expert in employment law
    • Experienced in dealing with settlement agreements
    • Able to advise on the intricacies of the terms of the agreement
    • Used to working collaboratively with HR departments
    • Efficient in order to conclude the process quickly


    Many firms pass over the signing of settlement agreements to junior lawyers who are inexperienced in employment law and in giving advice to employees on settlements. (This is not the case at Monaco Solicitors).

    You should avoid this kind of set-up and check out the employment law experience and reputation of the firm you will be dealing with.  You should also ask about the experience of the person to be assigned to your case before you ask the firm to act on your behalf.

    Time is often of the essence in ‘sign-only’ situations, and you may be seeking to obtain advice and a settlement agreement certificate in a matter of hours, rather than in days or weeks. So do also check out the turn-around time of the firm and individual lawyer you choose to sign off your agreement.

    Why do you need advice from an employment law specialist?

    The fact that you have been offered an agreement does not mean you are out of the woods yet. The terms of the agreement can be so onerous that the original deal is seen in a different light when advice is taken, or it may contain terms that restrict you so much when you have left your job, that it will effectively ruin your future career.

    This is when it’s essential to take proper legal advice on the contractual terms of the agreement from a lawyer who has had many years of experience in dealing with not only the terms of the agreement themselves but also the consequences of those terms in court.

    Specialist expertise and experience are particularly important in advising on the consequences of restrictive covenants and confidentiality clauses. What’s more, in almost all cases that make it to court, the cost, stress and disruption could have been avoided had the employee taken proper legal advice on their contract and/or settlement in the first instance.

    You might care to have a look at our settlement agreement templates.  These examples of settlement agreements drawn from real life will give you an idea of the complexities of such documents and why you need a specialist to review your agreement.

    Alex Monaco

    Top Tips

    Alex Monaco

    1. You are required to obtain legal advice for the agreement to be binding

    2. Even if you are happy with the offer the agreement can still be changed to your benefit

    3. Seek an experienced lawyer to ensure you get the best out of your agreement

    Collective or multiple redundancies

    Unfortunately, changes in business circumstances sometimes dictate that an employer will need to make multiple redundancies in order to ensure its survival or competitiveness. This inevitably leads to the employer offering a large group of employees similar settlement agreements.

    This is another area where an employment law specialist firm can help. Such a firm can send a lawyer or even a team of lawyers to an employer’s workplace or a neutral venue to advise large groups of employees on the effects of their terms of settlement.  Special rates can probably also be negotiated for a service like this.


    Next steps

    If you think that Monaco Solicitors could help you by reviewing and signing your agreement, please don’t hesitate to get in touch by filling in our online contact form. This will only take a couple of minutes to fill out and will help us to understand your individual circumstances.

    You could also use our settlement calculator to find out a settlement figure that you could potentially achieve. If what you’ve been offered is significantly less than this, then contact our team today.

    For straightforward cases, we can provide a 24-hour turnaround for sign-only settlement agreements, and remember that it is not the employee that pays our fee for this, but the employer. For further information, see the outline of our fees here.

    Contact us via:

    • website link
    • phone 020 7717 5259
    • email: