Usually a payment will be made to the employee in exchange for giving up their employment rights. It is important that you understand the potential value of those rights (and the potential costs and risks of pursuing them).

If it is a redundancy situation, is the calculation correct? There is an online calculator available at https://www.gov.uk/calculate-employee-redundancy-pay

Is the employer paying a sum in lieu of notice or serving notice? What will be the tax treatment? Will the pay in lieu include a payment in lieu of benefits as well as salary?

Will any company car require to be returned immediately? If not, what will the insurance position be for any period of retention?

Settlement agreements usually contain confidentiality provisions restricting discussion about the terms of the agreement and sometimes also about the circumstances and existence of the agreement. In the lead up to a settlement agreement it can be helpful to be circumspect about whom you discuss your employment situation with. Professional advisers and spouses / civil partners are usually permitted under most agreements but if the employee has made wider disclosures, this can sometimes can cause difficulties.

When you are moving on from employment, it can be important to clarify what reference your employer will issue if asked. Most employers issue fairly brief factual references these days – but it can be useful to check the terms won’t be damaging and make sure the agreed reference is recorded in the settlement agreement.

It can be important to a departing employee how their departure is announced both internally and externally. Again settlement agreements can be used to give comfort that this will be done along agreed lines.

Are there any insurances that the employer might agree can be continued post termination? If so, remember to consider any tax liability.

It is common for the employer to make a contribution to the employee’s legal fees when entering a settlement agreement. It will be important to check with the solicitor whether this will cover the advice or whether there may be additional charges and how these will be arrived at.

Many employees have contracts of employment that restrict them from certain types of competitive activities for a period after the employment ends. Depending on the circumstances, entering a settlement agreement may give an opportunity to negotiate the removal of the restrictions.

If you've been offered a settlement agreement by your employer we're happy to provide advice. Turn around times are often tight for finalising settlement agreements and you may require legal support fast. We can almost always accommodate same-day appointments, including outside normal office hours.

To make sure you're getting a fair deal, please get in touch directly with our team on 01463 795 042.