Employment Settlement Agreement Case Study

11 October 2016

Client Situation

Our client, Mr M from London contacted our Employment Solicitors after having been dismissed from his job following the general election in 2015. This had come as a surprise to him as he had continued to work for almost 2 weeks after the election date.

The employer had offered him Redundancy Pay and accrued holiday pay but nothing further.

How We Helped

Our Employment Solicitors conducted an assessment of our client’s position including drafting a schedule of loss to detail what we considered would be a reasonable settlement amount in the circumstances.

We sought to negotiate with the employer but they refused to change their position. We then contacted ACAS to commence Early Conciliation, which is a prerequisite to bringing an employment law claim. Once the employer was informed us that had done this the employer contacted us to begin Settlement Agreement discussions.

We sent detailed correspondence to the employer detailing our client’s position and the legal arguments. This successfully promoted an increased settlement agreement offer which we advised our client to accept.

Once the financials were agreed we advised our client in detail about the wording of a settlement agreement and specifically how the wording could affect his tax liabilities. We requested some amendments to the wording of the settlement agreement and had these agreed by the employer.

The Outcome

The Settlement Agreement was signed three weeks after Mr M contacted us and resulted in him receiving over £10,000, approximately 50% more than what the employer had originally been willing to pay.

The client contacted me again some 8 months later as he had a query about the tax position of one of the payments he had received. I provided him with the information needed for him to respond to his employer and HMRC and evidence what the employer had agreed at the time of negotiations. For more information see How to Minimise Tax Liability from a Settlement Agreement.

I was pleased when the client updated me to let me know the matter had resolved confirming my advice had “made all the difference”.

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