Key benefits of our service
Settlement agreements, formerly known as compromise agreements, are documents which set out the terms and conditions agreed by those involved (the two parties) when they agree to settle a potential employment tribunal claim or claims, or other court proceedings.
By signing a settlement agreement you are effectively waiving any legal claim you may have against your employer whether arising out of the period of your employment or the termination thereof.
You are required to take independent advice on the terms and effect of a settlement agreement before it can be considered legally binding. Therefore your employer needs you to take independent legal advice in order to have peace of mind that all potential claims arising out of your employment and the termination thereof have been compromised out of.
This will depend entirely on the nature of the payment. Ordinarily, any contractual payment made to you, such as salary, bonus and paid holiday entitlement will be subject to tax in the normal way. Any redundancy payment (whether statutory or enhanced), or payment genuinely representing compensation for loss of employment, injury to feelings or damages can be paid tax exempt up to £30,000. Specialist tax advice needs to be obtained in relation to this complex, technical area. We provide this advice as part of our settlement agreement service.
In the majority of cases, your employer agrees under the terms of the settlement agreement to contribute an amount up to a certain level (typically between £300 to 500 + VAT) towards your legal fees for having to obtain independent legal advice on the basic meaning and effect of your settlement agreement.
At iLaw we guarantee that we will not charge more than the cost contribution for obtaining this basic advice. Ordinarily therefore you won’t have to pay anything towards our fees, assuming you are happy with the terms of the settlement agreement being offered and do not wish to seek any amendments. We will send your invoice for payment directly by your employer as provided for in the settlement agreement. So long as your employer pays our invoice there will be nothing for you to pay.