Settlement Agreements

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Settlement Agreements at Woodstock Legal Services



A settlement agreement is a legally binding contract, often used when employment comes to an end. The employee agrees not to bring certain claims against the employer in return for a payment or other agreed terms. For the agreement to be valid, the employee must receive independent legal advice. Woodstock Legal Services advises employees and employers on settlement agreements across England and Wales.


Our employment lawyers advise on settlement agreements following redundancy, dismissal or resignation, exit negotiations and protected conversations, reviewing and negotiating settlement terms, references, confidentiality and restrictive covenants, and drafting settlement agreements for employers.


You’ll work directly with an experienced lawyer who explains the agreement in plain English, gives you an honest view of the terms on offer, and helps you reach an outcome you’re comfortable with.


Advice for Employees


Being offered a settlement agreement can come as a surprise, and you may be asked to sign within a short timeframe. It’s important to understand exactly what you’re agreeing to, and whether the terms reflect the strength of any potential claims you’re giving up.


Our lawyers review the agreement with you, explaining the claims you’d be waiving, the payments you’ll receive and how they may be taxed, and any ongoing obligations such as confidentiality or restrictive covenants. Where appropriate, we negotiate with your employer to improve the terms, for example the settlement payment, your reference or your leaving date.


Once you’re happy with the agreement, we sign the adviser’s certificate confirming that you’ve received independent legal advice, so the agreement can become legally binding.


Advice for Employers


For employers, a well-drafted settlement agreement can bring a working relationship to a clean, certain end and reduce the risk of future claims. Getting the process and wording right is essential.


Our employment lawyers advise employers on when a settlement agreement may be appropriate, how to approach protected conversations, and how to structure an offer. We draft clear, enforceable agreements covering the settlement terms, waiver of claims, confidentiality, references and post-employment restrictions. We also work closely with our commercial and corporate teams where wider business issues are involved.


We’ll help you reach a fair, practical settlement efficiently, protecting your business while treating the departing employee properly.

Get in Touch With Our Employment Law Team

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Employee Rights & Unfair Dismissal FAQs

  • Do I have to sign a settlement agreement?

    No. You’re under no obligation to sign a settlement agreement, and you shouldn’t feel pressured into agreeing to terms you’re unhappy with. Taking independent legal advice will help you understand whether the offer is fair, what alternatives are available and whether there’s room to negotiate.

  • Why do I need independent legal advice?

    For a settlement agreement to be legally binding, the employee must receive advice from an independent adviser, such as a solicitor, on the terms and their effect. In particular, they must be advised on their ability to bring a claim. The adviser then signs a certificate confirming the advice has been given.

  • Can I negotiate the terms of a settlement agreement?

    Yes, in many cases. Depending on the circumstances and the strength of any potential claims, it may be possible to negotiate a higher payment, an agreed reference, a different leaving date or changes to restrictive covenants. We’ll advise on whether negotiation is worthwhile and handle discussions with your employer on your behalf.

  • Will my settlement payment be taxed?

    It depends on what the payment is for. Some termination payments may be paid tax-free up to a set limit, while others, such as notice pay, holiday pay and contractual payments, are usually taxed in the normal way. The agreement should set out how each payment will be treated. We’ll explain the position before you sign.

  • What claims will I be giving up?

    A settlement agreement usually waives most claims you could bring against your employer, including unfair dismissal, discrimination and breach of contract. Some rights, such as accrued pension rights and certain personal injury claims, are often excluded. We’ll go through the waiver with you so you understand exactly what you’re agreeing to.

Why Choose Woodstock Legal Services?

Low Caseloads: Your Matter Gets Time

As consultants, our conveyancers manage their own caseloads and only work for a handful of clients at any one time. That gives your purchase or sale the time, care and attention it deserves, from first call to completion.

Proactive Updates: No Chasing

Our consultancy model means you deal directly with your lawyer, not a call centre or a rotating team. They keep you informed at every stage and are on hand to answer your questions, so you’ll never need to chase.

Honest, Practical Advice

We give you a realistic view of your position from the outset, including the strengths and risks of your case, so you can make informed decisions with confidence.