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Employment Law For Businesses

Termination And Settlement Agreements

Employment Solicitors in Manchester and London with a wealth of experience in dealing with Termination And Settlement Agreements

It is always unfortunate when an employment relationship needs to be terminated. These situations need to be handled with great care in order to avoid claims for unfair dismissal. We can offer you strategic advice and help you avoid some of the common pitfalls and risks employers fall into, increasing their risks of an unfair dismissal claim.

Difficulties in employment termination

Terminating an employment is tricky business. Some of the most common difficulties we encounter are:

  • Sickness absences. Click here to see how to manage sickness absences
  • Preserving confidentiality
  • Tax free payments in settlement agreements
  • Bonus payments
  • Share options
  • Avoiding unfair dismissal, wrongful dismissal and discrimination claims
  • Redundancy. Click here for more information on redundancy

The most important advice we give to any clients in this situation is to follow procedure. You should have a procedure and policy documents which will set out the termination process for issues like sickness and redundancy. It is important that you follow these procedures exactly. If you fail to follow the procedure you could expose yourself to liability at the Tribunal. 

Shares, share options and bonuses

For senior employees it is not just the pension and salary you need to consider, but also the additional compensation they receive for their employment. These rights can be incredibly valuable and need to be handled properly.

On the termination of employment there is no requirement to transfer shares or relinquish share options unless it is written in the shareholder agreement or equivalent document. If an agreement is struck regarding the shares on the termination of employment, this should be reflected in a separate agreement.

How to avoid unfair or wrongful dismissal claims

The best step you can take to avoid unfair or wrongful dismissal claims is to follow the correct procedure. Other steps you can take include:

  • Early legal advice
  • Follow your policies and procedures
  • Follow the ACAS guidelines

Settlement Agreements

A settlement agreement is a written agreement between the company and the employee outlining the terms of the termination of employment. The employee will agree not to bring any claims against the company in return for a payment. 

A settlement agreement can be used where you do not want to go through the procedure for dismissing an employee, or you are concerned about a potential claim and want to remove the risk.

For the settlement agreement to be legally binding your employee needs to get independent legal advice, otherwise the agreement cannot be enforceable. Employers generally pay for the legal advice up to a certain fee which will depend on the circumstances. You should provide a settlement agreement to the employee in advance so that they have reasonable time to consider the terms outlined in the settlement agreement. 

How can Monarch Solicitors help?

Our specialist employment solicitors have decades of experience dealing with employment issues. They are well equipped to deal with a whole manner of different cases no matter how big or small. 

Our team have had great success negotiating settlement offers, taking claims to the Employment Tribunal, and many more. Every person we represent receives the same high quality of treatment and personal service.

Contact our employment lawyers today

Whatever your issue our employment solicitors are here to help.

Call us on 0330 127 8888 for an initial consultation. Or email us on [email protected] and one of our team will get back to you.

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