Settlement Agreement: What Happens After?

If you have recently been proposed a settlement agreement by your employer, and you want to know exactly what is involved, especially once the settlement agreement has been completed, Smith Partnership’s settlement agreement solicitors are here to help. 

For many people undergoing the settlement agreement negotiations process, it’s common to plan ahead and think about every eventuality, such as things that can impact your settlement agreement and your rights surrounding the agreement. 

To help you, we have answered some of the most commonly asked questions surrounding settlement agreements, specifically around challenging, rescinding and withdrawing settlement agreements at various stages.  

Can a settlement agreement be challenged? 

It is very common for settlement agreements to be challenged before they are signed and become legally binding – this may be because you as the employee do not feel happy with the contents of the agreement, such as the settlement payment figure presented. 

In this case, you may challenge the settlement agreement through your dedicated settlement agreement solicitor. A settlement agreement can also be withdrawn at any point before signing, which often happens as a result of changing circumstances.  

Once the settlement agreement has been signed by both parties, it becomes legally binding. Should you wish to challenge or amend the contents of the agreement after this point, this can only be done with written agreement from both sides. 

Can a settlement agreement be rescinded? 

In some instances, a settlement agreement can be rescinded (set aside) on the grounds of validity, such as capacity, mistake, and duress, as well as fraud and illegality. 

When this occurs, the validity of the settlement agreement can be challenged, and in some cases, rescinded. Specialist advice would be needed on this if relevant, if you have a specific query relating to this, please get in touch and we can see if we can help. 

Can an employer retract a settlement agreement? 

As mentioned above, a settlement agreement can be withdrawn at any given point before signatures are acquired, and this can be done by either the employer or the employee. 

Should you refuse to sign the agreement and not accept the offer, your employer is well within their rights to retract the settlement agreement, they do not have to keep this offer open for any period of time.  

In this situation, the dispute will continue, either through to employment tribunal or until both parties can come to a mutual understanding through negotiations via the solicitors.  

How long do I have to consider a settlement agreement? 

According to guidance on ACAS, an employee has a minimum of 10 calendar days to decide whether or not they want to accept the terms of the settlement agreement from issue of the agreement, although there is no set law on the time period for settlement agreement considerations.  

An employer cannot demand that the agreement be signed straight away, and must allow time for the employee to review the terms, consult with their solicitor, and reach a conclusion.  

If your employer places pressure on you to sign straight away, or sooner than the 10-day period, this can be seen as undue pressure.  

What is the penalty for breach of a settlement agreement? 

A settlement agreement is a legally binding document and must therefore be adhered to by both parties. Should a company breach the agreement, there will be serious legal implications as a result. 

For example, if your employer breaches the terms of the settlement agreement, you may be able to bring forward a breach of contract claim against the company. 

The aim of this claim would be to achieve compensation for the employee for any losses they may have incurred as a direct result of the breach and the employer’s violation of the agreement.

How can Smith Partnership’s settlement agreement solicitors help? 

Navigating a settlement agreement can, in some circumstances, be a complex process, and can sometimes generate unprecedented outcomes. 

With services provided by Smith Partnership Settlement Agreement solicitors, you can rest assured that you will have the support and legal guidance you need from start to finish, as well as later down the line should anything surrounding your settlement agreement arise. 

Simply get in touch with us today by emailing, or calling us on 08000 32 32 02 to discuss your settlement agreement queries today. 

We are proud to offer an 8am to 8pm contact service, Monday to Friday, which many other legal practices and solicitors do not offer. 

At Smith Partnership, we understand the importance of providing accessible points of contact, which is why we are available via phone, email, or through our contact form at your time of need and can provide advice within 24 hours and due to the remote facilities, this can be done on a national basis.   

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