Settlement agreements (formerly known as compromise agreements)

6 November 2025 | HR Support for Businesses |

When making an employee redundant or dismissing them, it is highly advisable to get the employee to sign a settlement agreement wherever possible. Settlement agreements (which replace ‘compromise agreements’) are legally binding contracts in which the employee will agree not to make an employment tribunal claim, usually in exchange for a payment and/or reference to the employee.

Our expert employment lawyers can negotiate and create settlement agreements for you, helping to protect your business from any potential negative fallout as a result of letting an employee go.