Termination agreements, compromise agreements, gagging clauses, mutually agreed resignation, ex gratia payments, golden goodbyes… these are just some of the terms that are used to describe these contracts which stop employees bringing claims against employers. The proper term is “settlement agreement”.
The purpose of a settlement agreement is for an employer and an employee to agree terms under which the employee waives (or gives up) their right to bring certain claims against the employer. They can be used to terminate your employment and also to settle a claim you are bringing in a court or employment tribunal.
A settlement agreement can be suggested by either an employer or an employee as a way to part company on agreed terms.
Here we have collated answers to the most common questions we are asked but if you would like to discuss your particular circumstances free, in confidence and without obligation, click here to contact us.