Richard Grogan on employment law: Settlement agreements
Employment law solicitor Richard Grogan of Richard Grogan & Associates writes on settlement agreements.
We are coming across cases where employees have been asked to sign full and final settlement agreements without the benefit of legal advice. In many cases, they are not even offered or advised of the importance of obtaining legal advice. This was covered in recent decisions in the EAT.
In one case, the document stated:
“I acknowledge that I understand the effect and implication of this agreement and confirm and agree that I have been afforded the opportunity of obtaining independent legal advice regarding the contents and effect of this agreement.”
In that case the EAT held obtaining informed consent is not a matter of rushing through a number of cursory steps, but a matter of making a genuine effort to enable the employee to take the necessary steps to realise what she or he is being asked to do when he or she signs the document containing a full and final settlement clause. In a relevant case before the EAT, compensation was awarded and the severance clauses were not held to be full and final.
There are some minimum steps that should be done.
It would be our view that if getting a full and final settlement agreement signed up it is important to get, from the employer’s side, legal advice as to how to deal with meeting with the employee and what form of agreement should be put in place.