Compromise Agreements
13th December 2011

Compromise Agreements and are a contract between the employer and the employee relating to ending the employment relationship. The purpose of a compromise agreement is for the employee to agree that in exchange for a sum of money they will not bring any claims for issues such as unfair dismissal and discrimination. The agreement also covers other types of claims which could be brought in the County Court.

As the compromise agreement is such an important document, the employee must seek legal advice. The compromise agreement itself contains a section detailing the name of the solicitor who has advised and that they have indemnity insurance in place. The adviser must be certain that the employee understands the effect of signing the agreement and that they will be compromising legal rights as a result.

It is generally the case that the employee will not have to pay the legal costs in obtaining the advice. The usual arrangement is that the employer will cover the legal fees of the advice up to a maximum level.

If you have been asked to sign a compromise agreement or you are an employer looking for advice in relation to the termination of employment, please get in touch. We would be delighted to talk with you.

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