Settlement Agreements: Expert Legal Protection When Leaving Your Job
25 Bold St, Warrington WA1 1HQ, United Kingdom
When your employment comes to an end, a settlement agreement can provide financial security and closure, but only if the terms are fair and your rights are properly protected. At DSM Legal Solicitors, we specialise in settlement agreement advice for both employees and employers, ensuring you understand what you’re agreeing to and that every term works in your favour.
A settlement agreement is a legally binding contract that concludes your employment. It typically includes compensation, notice pay, holiday pay, and often a commitment to provide a reference. In return, you give up the right to bring most employment claims against your former employer. That’s why getting independent legal advice is essential, as you need to know exactly what rights you’re protecting and what you’re giving up.
We’ll review your agreement in detail, explain every term, negotiate improved terms where possible, and provide the statutory adviser’s certificate you need to make it legally valid. If you’ve been offered redundancy, been dismissed, or are negotiating your exit, we’ll guide you through the process with clarity and confidence.
We provide expert legal advice to employees throughout the settlement agreement process:
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Review and Assessment
We thoroughly review the settlement agreement to ensure it’s legally compliant, fair, and accurate. We check that the terms agreed between you and your employer are correctly recorded and that nothing has been missed.
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Statutory Advice
By law, any settlement agreement must be supported by independent legal advice. We provide this statutory advice to ensure you fully understand what rights you’re giving up, including statutory claims such as unfair dismissal, discrimination, and breach of contract. We’ll explain what you can and cannot do once you’ve signed.
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Negotiation of Settlement Terms
Agreement terms are often negotiable. If we identify unfair terms or gaps that disadvantage you, we can negotiate with your employer to secure better conditions. This might include increased compensation, improved reference terms, or extended payment periods.
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Adviser’s Certificate
Once you’re satisfied with the terms, we sign and issue the Adviser’s Certificate, the legal document that confirms you’ve received independent advice. We forward this directly to your employer.
With DSM Legal Solicitors, you’ll move forward knowing your interests are protected, your agreement is legally sound, and you understand exactly what you’re agreeing to.
We understand that leaving your job can be stressful, uncertain, and sometimes emotional. That’s why we provide clear, jargon-free explanations of every term and what it means for you. We take time to answer your questions and ensure you feel confident in your decision before signing anything.
If you’re unsure whether the compensation offered is fair, we can advise on this too. While there’s no fixed amount for settlement agreements (compensation depends on length of service, seniority, how you’ve been treated, and your employer’s circumstances), we can help you assess whether your package is reasonable and where negotiations might succeed.
We provide comprehensive settlement agreement support to employers managing workforce transitions:
- Draft and Compliance
We draft robust settlement agreements that protect your business interests while remaining legally compliant. Each agreement is tailored to your specific circumstances and ensures all necessary protections are in place.
- Legal Risk Minimisation
A well-structured settlement agreement significantly reduces the risk of future claims. We ensure the agreement is watertight, that confidentiality and non-disparagement clauses are effective, and that your business is protected.
- Negotiation Support
We negotiate settlement terms on your behalf, ensuring you balance fairness to the employee with protection to your business. Our goal is to reach agreement efficiently, avoiding costly and time-consuming tribunal proceedings.
- Adviser’s Certificate Coordination
We liaise with the employee’s independent legal adviser to move the process forward smoothly, keeping timescales realistic and the process professional.
If you’re managing a redundancy, a performance issue, or an amicable departure, we advise on the best approach and help you structure the settlement to achieve a clean break with minimal future risk.
Sometimes an employer needs a settlement agreement to be reaffirmed at a later date. This might be when circumstances have changed, or simply as part of ongoing employment procedures. We handle this process smoothly:
- Review both the original settlement agreement and the reaffirmation agreement
- Check that there are no material changes since the original agreement was signed
- Repeat the statutory advice to ensure you understand what rights you’re giving up by signing the reaffirmation
- Sign and issue the Adviser’s Certificate
This service costs £250 + VAT.
If you require additional services, such as a financial review of your package, negotiation with your employer, or amendments to specific clauses, we’ll provide an exact quote once we understand your requirements.
We do not charge for minor amendments, such as agreeing reference wording or correcting errors made by your employer.
For employers, a well-negotiated settlement agreement offers certainty, confidentiality, and closure. Rather than face the cost, time, and uncertainty of tribunal proceedings, a settlement allows you to move forward with confidence and plan your staffing needs with clarity.
- Settlement Agreements (Straightforward Terms): £500.00 + VAT
- Settlement Agreements (Complex Terms): £750.00 – £1,000.00 + VAT
Although there’s no legal requirement for employers to contribute to legal fees, it’s standard practice. Most settlement agreements include a clause confirming the employer will contribute. Employers typically contribute between £500–£1,000 + VAT towards legal fees. If your employer has agreed to pay, we’ll invoice them directly.
Is the compensation I’ve been offered fair?
There’s no set amount, as compensation depends on your circumstances, including length of service, seniority, how you’ve been treated, and your employer’s financial position. We can advise whether your package is reasonable and identify areas where negotiation might succeed.
Can I ask for more?
Yes. Settlement agreement terms are often negotiable. We can help you seek improved terms with your employer if you believe the offer isn’t fair.
Are settlement agreement payments taxable?
Contractual benefits (salary, holiday pay, notice pay) are taxed. However, the first £30,000 of compensation or termination payment is tax-free under UK law. We’ll advise you on the tax implications of your specific agreement.
How long do I have to consider the agreement?
The ACAS Code of Practice recommends 10 days, but you and your employer can agree a shorter or longer period. We’ll ensure you have adequate time to make your decision.
How long does the process take?
If terms are agreed, we can usually complete the review and issue the Adviser’s Certificate within a day or two. If negotiation is required, timescales depend on how quickly agreement is reached with your employer. We’ll keep you informed every step of the way.
Will I be giving up all my rights?
No. Although you will be giving up most of your rights, you will still be able to bring some claims even when the settlement agreement has been signed. We’ll advise you on which rights you retain.
Do I need a solicitor?
To ensure your settlement agreement is legally valid, the adviser’s certificate must be signed by an independent qualified adviser, usually a solicitor.
How long before I get paid?
The average payment time is 14–28 days from the date the Settlement Agreement is signed.
Can I be forced to sign?
Absolutely not. You’re never under any obligation to sign a settlement agreement. However, many people choose to do so to receive tax-free compensation for loss of employment.
Can my employer be forced to provide a reference?
No, by law your employer isn’t obliged to provide a reference. However, many will agree to provide a factual reference to prospective employers if requested. It’s important to include this in your Settlement Agreement so it creates a binding obligation.
Contact us for a confidential discussion about your settlement agreement. If you’re an employee with an agreement to review or an employer needing settlement support, we’re here to help.
DSM Legal Solicitors specialise exclusively in settlement agreements for employees and employers. We do not:
- Take employment tribunal cases on a no-win-no-fee basis
- Provide speculative advice on whether you have a viable employment claim
- Handle disciplinary hearings or redundancy processes outside of a settlement context
- Advise on ongoing employment disputes.
