A settlement agreement is a legally binding agreement in which an employee (or ex-employee) agrees not to pursue particular claims in relation to their employment or its termination, typically in return for a financial settlement.
For a settlement agreement to be legally binding, a number of conditions must be met, including that the employee has received independent legal advice from a "relevant adviser" as to the terms and effect of the agreement.
An employer that is considering offering an employee a settlement agreement should ensure that it understands the rules on when such negotiations will be admissible as evidence in employment tribunal claims.
