Settlement agreements

Times are tough.  Both employers and employees face some difficult times ahead.  Increasing austerity can significantly increase pressure on businesses and their employees.  Work may dry up, employees may become demotivated or management may prefer a change of focus or direction.

All these stresses can lead to tensions that would historically have been dealt with under disciplinary procedures or grievance procedures.  Both procedures are difficult for the parties involved and can lead to further resentment and a negative impact on the business.

Settlement agreements are not a new phenomenon although many will remember them as compromise agreements.  Provided the rules are followed in relation to how these agreements are approached then it is possible for employers and employees to agree on the terms by which the employee’s employment is terminated, thus enabling a clean and amicable break.

However, timing is everything.  Therefore both employers and employees should seek legal advice as soon as they believe issues are arising which may have consequences for the future.  In that way potential problems that may otherwise impact on the business or staff morale can be nipped in the bud at the earliest opportunity and with minimal disruption to the business.

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