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A settlement agreement is a legally binding agreement that makes amendments to an employee’s contract.

It is usually used to terminate an employment contract but can also be used to settle disputes or in cases of voluntary redundancy. More often than not, a settlement is used to end employment quickly, without needing to go through the usual notice period.

Our specialist employment law team can provide the legal support you need, guiding you through the settlement agreement process carefully and reliably.

Our skilled team of employment law experts have years of experience in drawing up settlement agreements to protect our clients’ interests.

We can draft you a comprehensive, bespoke settlement agreement, including the following key clauses:

  • Waiver
  • Notice period
  • Payments
  • Confidentiality clause
  • Restrictive covenants
  • Reference
  • Warranty
  • Payment for legal advice
  • Tax indemnity

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We’ll work on your behalf to secure the best possible outcome. 

The payments made as part of a settlement agreement are usually tax-free up to the first £30,000. However, it must not include any standard pay, holiday pay, or pay in lieu of notice as this is taxable.

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