What is a Settlement Agreement or Compromise Agreement? with Katie Ash

Expert employment solicitor Katie Ash explains and answers some questions around settlements agreements.

• What is a settlement agreement (Compromise agreement)?
• What happens if the employee doesn’t want to accept the settlement agreement?

What is a settlement agreement?

A Settlement Agreement (previously known as a Compromise Agreement), is recognised by Statute as a legally binding contract made between an employee and employer, either during or after employment. The agreement sets outs the terms of the termination employment relationship between both parties and prohibits the employee from bringing legal action against the employer in respect of their employment and/or its termination, usually in exchange for a termination payment.