Compromise Agreements
As experienced employment solicitors we tell all our employment law clients to come to us for employment law advice as soon as possible if considering a compromise agreement: prevention is always easier than cure. Timing can be crucial in relation to a compromise agreement for a number of factors.
Some employers would rather offer a compromise agreement than take an employee through a disciplinary procedure. This can be beneficial for both sides - the employer has certainty and saves management time and focus, whereas the employee can leave with dignity and may get an ex gratia payment. However, it can be considerably risky - several cases have shown that this strategy can result in the employee bringing a successful unfair constructive dismissal claim. It may be possible to offer a compromise agreement on a ‘without prejudice' basis, which would prevent this problem. However, this is a tricky and changing area in employment law - if you want to go through this route we can help you through each step of the process.
Cost factors can be relevant in timing factors. If you have insurance, you should check with your insurance broker whether you can offer a compromise agreement without your insurers consent.
There are also strategic factors to consider in relation to timing. If a compromise agreement is offered too early, the employee may think a later offer may be better or that your case is weak. You will want to try to offer it at a time when the employee is more likely to accept it, but not at a time where a Tribunal may consider you have acted improperly by putting undue pressure on the employee or not dealing effectively with a discriminatory practice.
We take a pragmatic and strategic approach to enable you to negotiate an exit where one is needed. If the worst case scenario happens, or has happened, and there is an employment claim against you, we look after your best interests to achieve the best solution possible.