A compromise agreement is a legally binding arrangement between an employer and an employee, which sets out the financial and other terms on which they will go their separate ways.
In essence, such agreements include a severance payment made by the employer in return for the employee agreeing not to bring certain legal claims against the employer.
There are various circumstances in which a compromise agreement may be proposed, including redundancy, mutual agreement, dismissal or to settle an employment tribunal claim.
Once a compromise agreement has been signed by an employee, they accept the terms as a full and final settlement. As a result, they waive their rights to bring an employment-related claim against the (former) employer.
At Palmers Solicitors, we have the expertise required to prepare and advise on compromise agreements, including negotiating the final terms. For more information and guidance, please contact us.