Settlement agreements, previously known as compromise agreements and ACAS COT3s are legally binding agreements that waive an employee’s right to make a claim covered by the agreement to an employment tribunal or court. They invariably involve a payment to the employee in full and final settlement and are used extensively for senior level exits from a business but can be used at all levels.
AB Commercial HR Solutions can support with all aspects of settlement agreements and COT3s
- Drafting settlement agreements and COT3s
- Brokering financial settlement and facilitating discussions between the parties
- Agreeing acceptable “forms of words” to cover employee references and to announce departure from the business
- Negotiating terms between the parties and acting as a “go between”
- Advising on confidentiality arrangements
- Advising on how to protect the business from future risk.
Settlement agreements and COT3s protect the employer and employee and specifically in the case of a settlement agreement, they will always need to seek legal advice on the terms of the agreement. In some situations where the exit is acrimonious, it is sensible for the process to be managed independently through a third party.
