Thursday, July 18, 2019

Wilson Browne - Settlement Agreements

Most of us will know a settlement agreement as a legal contract between an employer and employee which settles a claim the employee has made against their employer, typically used in conjunction with the termination of the employment.

There are however occasions when employment will continue but the agreement is used to settle any ongoing disputes between the employer and employee.

What can and should be included in a Settlement Agreement? 

Settlement Agreements will contain several standard terms including;
  • Payment for the termination to be provided by the employer to the employee after they have agreed to terminate their contract. Amounts of settlements vary based on a range of factors including performance to date by the employee, number of years of service and current salary.
  • Any outstanding payments for salary, commission, bonuses and accrued holiday pay owed to the employee.
  • Usually an employee will agree to drop any past claims against the employer and vice versa. 
  • The employer will often contribute towards any resulting legal costs.
  • A ‘good reference’ can be requested by the employee to aid with future job application but can be denied if the employee has performed poorly. 
  • Up to £30,000 of compensation will be tax free for the employee.
  • A Non-disclosure Agreement or Confidentiality clause as well as a Non-Derogatory clause is usually included to the benefit of both parties.
  • The settlement agreement must be signed by either an official from the Trade Union, a solicitor specialising in this area of law or a member of the Citizens Advice Bureau.

Who can sign a Settlement Agreement?

The agreement is agreed by an employee (current or former) and an employer but can also be entered into by someone who is not employed by a company. An example of this is could be an individual who feels they were discriminated against during a job interview, however, a Settlement Agreement is for individuals and not groups of people.

How much can I get as a Settlement Agreement?

The sum of compensation for a settlement agreement can vary from case to case but there will usually be a clause which stipulates your employer will pay your legal fees.

This contribution amount is usually capped at an amount between £250-£500 plus VAT but if you are both happy with the agreement it is not likely that your fees will exceed this. If in doubt, you should seek advice from a Solicitor as to the likely fee estimate.

The compensation amount itself can be based on a variety of factors, some of which include:
  • Salary & Benefits- the agreement will typically ensure the employee will receive all the normal salary and any benefits up until the agreed termination date.
  • Holiday Days Accumulated- Any days of holiday the employee has accrued and not used during employment must be paid for.
  • Redundancy Payment- If the settlement agreement is in place as a result of redundancy, the employee will also be entitled to redundancy pay. This can vary depending on length of service, level within the organisation and current earnings.
  • Payment instead of a Notice Period- If employment is being terminated via the settlement agreement there may not be a standard ‘notice period’. In this instance an employer should pay for the amount that would have been earned during this period.
  • Termination Payment- This is a payment an employer can provide an employee as an incentive to sign the settlement agreement. 
  • Bonuses - Any bonuses the employee was entitled to for staying employed until a specified date need to be paid. 
  • Legal Costs- The employer is often required to contribute towards the fees incurred by the employee seeking legal advice surrounding the settlement.
  • Restrictions Payment- The employer may stipulate restrictions in the settlement such as not setting up a competing business within a specified distance or time or working for a competitor and in this instance, they will often provide an additional payment. 

Is it binding? What happens if a Settlement Agreement is breached?

A Settlement Agreement is a legally binding contract and once it has been signed, if either party breaches the terms, the wronged party are entitled to raise a claim in court.

In some settlement agreements there will be an enforceable repayment clause which allows employers to retrieve some, if not all, of the money topaid to their employee if the employee breaches the terms.

This is likely to include any legal fees the employer was required to pay as a result of the breach.

If you need advice on a Settlement Agreement and to ensure that you remain within the restrictions of this agreement, then you should seek professional legal advice today.

Monday, July 15, 2019

News Essentials: 15th July 2019

A brief summary of the essential family law news and cases from the last week:

Heterosexual couples may be allowed to convert marriages to civil unions
Ministers in England and Wales are considering how to extend civil partnerships. Full story: The Guardian.

Hale risks political storm by questioning legislation before parliament
The president of the Supreme Court has taken the constitutionally unusual step of publicly criticising a bill that is making its way through parliament. Full story: Law Society Gazette.

O'Dwyer v O'Dwyer [2019] EWHC 1838 (Fam) (12 July 2019)
Appeal by husband against spousal maintenance order, on the basis that the judge was wrong to identify the income stream of a business as matrimonial property. Appeal allowed. Full report: Bailii.

AB (Termination of Pregnancy), Re [2019] EWCA Civ 1215 (11 July 2019)
Appeal against order that would have allowed the termination of the pregnancy of a 24-year-old woman with moderate learning disabilities. Appeal allowed. Full report: Bailii.

X v Y (Permission to Appeal) [2019] EWHC 1713 (Fam) (03 July 2019)
Application by father for permission to appeal against financial remedies order. Full report: Bailii.

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For more news, see here.

For more cases, see here.

To subscribe to the Family Lore Focus free weekly Newsletter (which includes links to all of the week's top family law news stories, cases, articles and blog posts), go here.

Friday, July 12, 2019

New by me this week on the Stowe Family Law Blog

My posts this week on the Stowe Family Law Blog included:

The new Guide to the Treatment of Pensions on Divorce, and why it is needed - As the title says.

Hard talking with Lady Hale - Lady Hale's interview on the BBC HARDtalk programme.

A few thoughts on the recommendations of the Private Law Working Group - A quick look at some of their proposals for reform of the CAP.

Sir James Munby laments the state of the Family Court - In his recent speech at the Bloomsbury Publishing Family Law Conference.

Have a good weekend.

Monday, July 08, 2019

News Essentials: 8th July 2019

A brief summary of the essential family law news and cases from the last week:

Consultation: Children Cases in the Family Court – Interim Proposals for Reform
President of the Family Division launches public and private law consultation. Full story: Courts and Tribunals Judiciary.

New good practice guide addresses shortfall in understanding of how to treat pensions on divorce
An essential guide to the treatment of pensions on divorce has been published today by the Pension Advisory Group. The long awaited report brings guidance to family judges, lawyers and pension experts encouraging fairer settlements and helping to manage liability. Full story: Nuffield Foundation.

W-P (Children) [2019] EWCA Civ 1120
This case concerns an appeal by the mother against special guardianship orders that were made in respect of her two sons, L (10) and A (9) in favour of their paternal grandparents. Full report: Family Law Week.

Gray v Hurley [2019] EWHC 1636 (QB) (25 June 2019)
Judgment in Queen's Bench Division providing international family lawyers with a meticulous overview on establishing forum. A claim issued first elsewhere in the world, may not of itself be determinative. World-wide assets were brought under the overarching jurisdiction of the High Court. The sophisticated construct of trust claims engaged specific Articles. Full report: Bailii, via Family Law Week.

J (Children: Relocation) [2018] EWCA Civ 1372 (08 May 2018)
Application by mother fort permission to appeal against refusal of application to relocate with children to Ukraine, and appeal by father against order allowing the mother to return temporarily to Ukraine with the children. Full report: Bailii.

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For more news, see here.

For more cases, see here.

To subscribe to the Family Lore Focus free weekly Newsletter (which includes links to all of the week's top family law news stories, cases, articles and blog posts), go here.

Monday, July 01, 2019

News Essentials: 1st July 2019

A brief summary of the essential family law news and cases from the last week:

Family Court Statistics Quarterly: January to March 2019
Quarterly data on the volume of cases dealt with by family courts over time, with statistics also broken down for the main types of case involved. Full story: Ministry of Justice.

Judges overturn 'forced abortion' ruling
A woman has won an appeal against a court ruling that would have seen her mentally ill daughter forced to have an abortion. Full story: BBC News.

Man who refused to register son's birth loses high court case
Father said he did not want his baby to be controlled by the British state. Full story: The Guardian.

MB v EB [2019] EWHC 1649 (Fam) (25 June 2019)
Preliminary hearing in financial remedy proceedings to determine: i) the length of the marriage between the parties; ii) the impact of a separation agreement entered into in 2011; and iii) whether there was any marital acquest. Full report: Bailii.

SC v TC [2019] EWHC 1637 (Fam) (14 March 2019)
Appeal against order moving residence of child to father. The appeal was allowed, as the hearing was flawed due to there having been direct communication between the Judge and the solicitor at NYAS and others, without the knowledge of either parent. Full report: Bailii.

Z (care orders : designated local authority), Re [2019] EWFC B30 (11 June 2019)
Care proceedings concerning four children, in which the issue arose as to which local authority should be the designated local authority. Full report: Bailii.

C (Children) [2018] EWCA Civ 900 (07 March 2018)
Appeal by local authority against decision as to designated local authority in care proceedings. Appeal allowed. Full report: Bailii.

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For more news, see here.

For more cases, see here.

To subscribe to the Family Lore Focus free weekly Newsletter (which includes links to all of the week's top family law news stories, cases, articles and blog posts), go here.