The essence of the agreement is the employer’s offer of a compensation payment in return for the employee’s agreement not to progress his or her claims in the courts. These terms are expressed prominently in the document, with the compensation payment being offered in ‘full and final settlement’ of all the employee’s employment claims.
After an employee leaves employment he or she will remain under an implied (unwritten) duty to keep confidential any information that amounts to a trade secret. The obligation is one of unlimited duration.
An employer may want to remind the ex-employee about their obligation to keep the employer’s business affairs confidential and will include an express confidentiality clause to this effect in the settlement agreement.
An employer will want the employee to agree not to make any derogatory comments following the termination of employment. Such a non-derogatory comments clause will favour the employer; it may also extend protection to other officers and employees that work for the employer.
There is a good argument that protection should be mutual, with the employer offering the employee similar comfort.
Clauses to restrict the employee in their work activities following termination are called restrictive covenants or post termination restrictions. They may prevent the employee from working with a direct competitor, or from dealing with old customers, clients and suppliers.
Post termination restrictions may already feature in the employee’s employment contract. Otherwise the employer may feel justified in incorporating restrictions in the settlement agreement as part of the termination arrangement.
To be effective the employer has to make a payment against these restrictions; usually a small sum is allocated.
Depends on a variety of factors. We will advise about the particulars of your situation and explain how much compensation is appropriate
Is a settlement agreement offered when employees are redundant? Find out more on our redundancy pages
We seek to address your legal needs in a way that suits you. For certain matters we can offer a fixed fee arrangement. Learn more about costs with Aeon settlements
Discover more about the terms that the employer will include in the settlement agreement.
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“ Have just collected the signed papers - thank you again for your excellent service and support. “
“ I know I’ve said it already but many thanks for all your work, help and support with the offer! If any of my friends or colleagues ever have to go through this I will make sure Irecommend you to them. You’ve been amazing! “
“ Your help and advice much appreciated, and for being so approachable. “
“ Thank you so much for all your help with my settlement and for the support over the past couple of weeks – I couldn’t have done it without you “
“ Thank you for everything you did to get my settlement agreement done and dusted. Your advice made what could have been a very stressful time much more manageable “
“ Many thanks for your help with my redundancy settlement. My colleagues have spoken highly of you as well. “
“ Thank you so much for your help during a stressful time – it’s not easy dealing with a former company but you were very supportive and helped at each step of the process. “
Visit the Aeon Solicitors main site, where you will find our law library, with information on a diverse range of employment law and commercial law issues, spanning contracts, post-termination restrictions, disciplinary and grievance, unfair dismissal and wrongful dismissal.