Settlement Agreements – When employment ends


Kiran Virdee is the most recent addition to the Pudsey Legal team. She is a qualified Solicitor with experience in commercial and civil litigation and can also assist with advising on and drafting terms and conditions and commercial agreements.

Here, Kiran explains the important role of Settlement Agreements when an employment relationship comes to an end.

What are Settlement Agreements and when are they used?

  • Settlement agreements (also known as compromise agreements) are common in situations when an employment relationship is coming to an end, usually by mutual agreement, and where both the employer and employee want a “clean break” from each another.
  • Settlement Agreements include terms and conditions agreed between both parties for bringing the employment to an end, often on the promise that an employee agrees to settle any potential employment tribunal claims or any other claims.


Why is it important to seek independent legal advice on Settlement Agreements?

  • Often an employer who has offered a Settlement Agreement will inform an employee that they need to take independent legal advice on the agreement and will usually pay (or make a contribution towards) the solicitor’s costs.
  • The Agreement is usually drafted by the employer or their solicitors and an independent legal adviser will make sure you fully understand what you are signing. For example, has the money offered to you been calculated correctly? Have you been given the correct notice?


Settlement Agreements also contain various assurances (known as “warranties“) that an employee is required to give when signing the Agreement. If you breach these or the Agreement in any way, you may face a potential claim in the future. An independent legal adviser will advise you on these and sometimes suggest changes to the Agreement to make sure you are happy with what you are signing.

Whether the proposal of a Settlement Agreement has come out of the blue or whether you have been in the driving seat and negotiated the terms yourself, it is a good idea to take independent legal advice to give you guidance on the terms of the Agreement and whether or not you should accept it.

If you find yourself in this situation, do not hesitate to contact us.




What is the process?


To help you understand the processes involved with our legal services, we can lead you thorugh a typical scenario using our PDF Smart Guides. To get an idea of what's involved, simply download a Smart Guide in each service area.

What's the next step?

Kiran Virdee

Call today on

0113 254 9733

To set up an initial consultation you can also email direct and arrange to pop into one of our offices.


0113 254 9733

Pudsey Legal
Cringlebar House,
415 Bradford Road, Pudsey,
Leeds, LS28 7HQ


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