As my role as a settlement agreement solicitor I get asked many times about what employment claims cannot be included in a settlement agreement. Understanding the limitations of settlement agreements is crucial for employees. While these agreements are designed to provide a clean break and prevent future legal disputes for the employer, they cannot cover every type of employment claim. So, as an expert settlement agreement lawyer, here is a breakdown of what typically cannot be included:

Key Principles

Specificity is Essential

Settlement agreements must relate to "particular complaints." This means a blanket waiver of all future claims is ineffective. The agreement should clearly identify the types of claims being settled.
This requirement is set in place to ensure that you as an employee signing the settlement agreement understand what rights you are relinquishing.

Statutory Rights

Certain of your statutory employment rights are protected and cannot be contracted out of, even with a settlement agreement.

Claims Typically Excluded or Limited

Future Unknown Claims

While settlement agreements can cover potential future claims if they are clearly identified, it is difficult to waive claims that are entirely unknown at the time of signing.
An Employment Tribunal will scrutinise attempts by an employer to waive claims that you the employee could not have been aware of.

Certain TUPE Claims

Claims related to failures under the Transfer of Undertakings (Protection of Employment) regulations, particularly regarding the duty to inform and consult you , have limitations on being waived within a settlement agreement.

Certain Agency Worker Regulations

If you are an agency worker, some claims arising from your employer’s breach of the Agency Workers Regulations 2010, concerning basic working conditions, may not be fully waivable.

Statutory Payments

Rights to statutory payments like Statutory Sick Pay (SSP), Statutory Maternity Pay (SMP), and other similar statutory payments are protected but I have dealt with many cases where an employer has wrongly sought to exclude this liability.

Pension Rights

If you have accrued pension rights these should be dealt with separately from your settlement agreement, as they are rights typically governed by pension scheme trustees and not your employer.

Criminal Offences

It is not possible to use a settlement agreement to prevent you from reporting a criminal offence.

Protected disclosures

Also known as whistleblowing. You as an employee can not be prevented from making a protected disclosure. Any attempt by your employer to abuse this lawful right would be illegal and result in you being able to claim significant compensation.

Importance of obtaining legal advice from a settlement agreement expert

A key requirement for a valid settlement agreement is that as an employee you must receive independent legal advice. This ensures you understand your legal rights and the implications of the settlement agreement. That is why you should always consult a solicitor who is expert in advising on settlement agreements. For advice on your settlement agreement contact Clive today, call 0330 043 8845, email clive@solicitor.help, or request a call back.