Been offered a settlement agreement, or think you might be? Understand it before you sign.
Being handed a settlement agreement is stressful, and it's normal to feel unsure what to do next. We're here to help you get free, impartial advice on it. Quickly, confidentially, and without any pressure to sign anything before you're ready.
- No cost to you, ever
- SRA-regulated solicitors only
- Agreement usually completed within 24 hours
- Your details are never sold
- Completely confidential. Your employer is never contacted
Not sure where to start? Try our free settlement agreement checker first, or just ask us a question. No document needed.
Get free advice and help
Fill in the form below or email your agreement to hello@settlementagreementguide.co.uk. Most people hear from a solicitor within 24 hours.
If you're feeling stressed about this, you're not overreacting
Almost everyone who contacts us is dealing with the same mix of worry: is the money fair, am I about to make a mistake, can I even afford proper advice, and what happens to my life if this goes wrong. None of that is unreasonable. A settlement agreement genuinely is a big decision, often made at one of the more stressful moments in someone's working life. A few honest answers to the things people worry about most:
- "I don't want my employer to know I've spoken to anyone." You don't have to tell them. Contacting us is entirely confidential, and nothing is shared with your employer without your explicit permission.
- "I'm worried I can't afford a solicitor." In the vast majority of cases you never pay anything. Your employer's contribution covers it, and we'll tell you clearly if your situation is different before you commit to anything.
- "I don't want to seem difficult by asking questions or pushing back." Asking questions is exactly what the law expects you to do before signing. A reasonable employer won't think less of you for taking the process seriously.
- "I'm not sure I even understand what I'm being offered." That's precisely the problem we exist to solve. Our whole first step is turning the document into something you can actually follow.
- "I feel like I have to decide quickly." You almost certainly have more time than it feels like. ACAS guidance recommends at least 10 calendar days, and a reasonable employer will accommodate a genuine request for more.
None of these feelings mean you're handling this badly. They're the normal response to an unfamiliar, high-stakes situation. And they're exactly why getting a second, independent set of eyes on your agreement is worth doing before you sign anything.
A quick jargon buster
Settlement agreements come with their own vocabulary. Here's what the most common terms actually mean:
- PILON. Payment in lieu of notice: a lump sum instead of working your notice period
- Without prejudice. A discussion aimed at settling a dispute that generally can't be used as evidence later
- Protected conversation. A pre-dismissal settlement discussion that's kept off the record for most unfair dismissal claims, with some exceptions
- COT3. A settlement reached through ACAS conciliation, usually once Early Conciliation or a tribunal claim has started
- Garden leave. Staying employed and paid during your notice period, but not required to attend work
- Restrictive covenant. A clause limiting what you can do after you leave, such as joining a competitor
See our full settlement agreement guides for a more detailed explanation of each.
Connects you with expert settlement agreement solicitors who've helped thousands of people in your exact situation
We are not a law firm ourselves, and we don't give legal advice. But every case we handle is signed off by an independent, SRA-regulated solicitor who deals with settlement agreements every working day. Between them, the solicitors in our network have advised thousands of employees facing redundancy, discrimination and whistleblowing exits just like yours, across every sector of UK employment. That's the level of experience behind every case we send their way. Not a generic template, and not guesswork.
What exactly is a settlement agreement?
A settlement agreement is a legally binding contract between you and your employer that usually brings your employment to an end on agreed terms. In exchange for a payment. On top of anything you're already owed, such as notice pay, holiday pay or redundancy pay. You agree to give up your right to bring most types of employment claim against your employer, such as unfair dismissal or breach of contract. It was previously called a "compromise agreement"; the name changed some years ago, but the document does the same job.
Because a settlement agreement waives real legal rights, Parliament built in a safeguard: it cannot take legal effect unless you've received advice from an independent, qualified adviser. Almost always a solicitor. Confirming you understand exactly what you're agreeing to. This is not a formality your employer can skip, and it's not something you can waive yourself. It's precisely why almost every settlement agreement includes a contribution from your employer towards the cost of that advice, and it's the whole reason a service like ours exists: to make sure that advice is clear, unhurried, and genuinely in your interest, not just a rubber stamp on a document you were told to sign quickly.
Settlement agreements come up in a wide range of situations. Most commonly redundancy, but also performance or capability concerns, discrimination complaints, whistleblowing disputes, and straightforward mutual exits where both sides simply want a clean, agreed departure. The document itself typically covers your final payment, your notice arrangements, any reference you'll receive, confidentiality obligations, and sometimes restrictive covenants limiting what you can do next. Every one of these terms is negotiable to some degree, which is exactly why reading it properly. Rather than skimming to the number at the top. Matters so much.
A settlement agreement is a one-way door. Get advice on it first.
Once you sign, you usually give up the right to bring almost any claim against your employer. For good. The law recognises this is a big ask, which is exactly why a settlement agreement can't legally take effect until an independent, qualified adviser has explained it to you. We connect you with that adviser quickly, without the stress of finding a solicitor yourself.
Fast, direct introduction
We pass your agreement straight to an independent solicitor. No delay, no middleman opinion on your document.
Solicitor sign-off
We introduce you to an independent, SRA-regulated employment solicitor who gives the legal advice the law requires.
No cost to you
Your employer usually pays a contribution towards the legal fees. It's built into almost every settlement agreement.
No pressure, ever
We'll never tell you to sign something you're not comfortable with, and there's no obligation to go ahead.
Two simple steps, usually completed within 24 hours
We've deliberately kept this process short. You're already dealing with enough. Most people have a solicitor in touch within a day.
1. Fill in the form
Fill in the form telling us about your situation, or email your agreement to hello@settlementagreementguide.co.uk if you've already received the written offer. This step is free, confidential, and comes with no obligation. We never contact your employer, and nothing you send us is shared with anyone without your permission.
2. A solicitor reaches out to discuss it
An independent, SRA-regulated employment solicitor from our network will contact you directly, usually within 2 hours, to talk through your settlement agreement, answer your questions, and negotiate on your behalf if there's room to improve the terms. Paid for by your employer's contribution, not you.
What's usually included in a settlement agreement
Every settlement agreement is different, but most cover the same handful of areas. Knowing what to expect makes it far easier to spot anything unusual in yours.
- Termination payment. The negotiated compensation on top of your statutory and contractual entitlements, often split into taxable and tax-free elements
- Notice arrangements. Whether you'll work your notice, be placed on garden leave, or receive a payment in lieu of notice (PILON)
- Outstanding entitlements. Unpaid salary, accrued but untaken holiday, and any contractual bonus or commission owed to you
- References. The wording and tone of any reference your employer agrees to give, usually attached to the agreement itself
- Confidentiality. Restrictions on discussing the settlement, and sometimes the wider circumstances of your exit
- Restrictive covenants. Any limits on working for a competitor, approaching former clients or colleagues, for a defined period
- Legal fees contribution. Your employer's payment towards the independent advice the law requires you to receive
Every one of these is potentially negotiable. A settlement agreement is a starting proposal from your employer, not a final offer handed down from above. The advice from the solicitor we introduce you to will tell you which of these terms in your specific agreement are worth a closer look.
What can actually be negotiated?
A settlement agreement is about more than the headline figure. Depending on your circumstances, there may be room to negotiate on:
- Compensation payments
- Notice pay, or whether you work your notice at all
- Redundancy pay, where redundancy is part of the picture
- The wording of an agreed reference
- Restrictive covenants and how long they last
- Confidentiality clause wording
- How (and whether) your departure is announced internally
- Your exit date
- Bonus and commission payments
- Outstanding holiday pay
A good outcome isn't always about the highest possible number. Often it's about the right overall package, one that lets you move on with confidence, not just a bigger figure on page one.
What's brought you here?
Redundancy settlement agreement
Offered a settlement instead of. Or alongside. A redundancy process. What to check before you sign.
Read more →Discrimination settlement agreement
Settling a discrimination concern. Why these agreements need extra care, and what fair compensation looks like.
Read more →Whistleblowing settlement agreement
Raised a concern and now being offered an exit. What protections still apply, and what to watch for.
Read more →What to do before you're handed anything
Most of this site talks about the moment you're handed a settlement agreement. But if you're still earlier than that. You've just been told your role is "at risk," or you've been invited to a redundancy or disciplinary meeting. There's already a lot you can do to protect your position.
- You can usually bring someone with you. For formal disciplinary and grievance hearings, you have a legal right to be accompanied by a colleague or trade union representative. Many employers extend the same courtesy to redundancy consultation meetings, even where it isn't a strict legal requirement. It's always worth asking.
- Start gathering evidence now, not later. Keep copies of your contract, appraisals, emails, and anything relevant to the process. If you're ever offered a settlement agreement, this record can matter to how strong your position is.
- Ask questions in every meeting. What are the selection criteria? How have I been scored? Why is this role at risk? You're entitled to understand the process, not just be told the outcome.
- Write a short note after each meeting. A calm, factual follow-up email confirming what was discussed protects you if there's ever a dispute about what was said.
- You don't need a settlement agreement in hand to get advice. If you're worried about how a process is being run, it's worth thinking it through before things move further, not just once a document lands on your desk.
Read our full guide on what happens before a settlement agreement, or our guide on what to say, and what to avoid, with your employer.
Every question, answered
What is a settlement agreement?
The basics: what it is, why it exists, and what makes it legally binding.
Read more →Facing redundancy? What happens first
Consultation, selection criteria, and what to do before any settlement is offered.
Read more →How much compensation should I get?
What genuinely moves your figure up or down, and how to sense-check an offer.
Read more →How long do I have to decide?
What ACAS recommends, and what to do if you're being rushed.
Read more →Can I refuse to sign?
What actually happens if you say no. And when that makes sense.
Read more →Talking to your employer
What to say, what to avoid, and how to protect your position in writing.
Read more →Who pays the solicitor fee?
Why your employer almost always covers your legal advice.
Read more →Tax on settlement payments
What's tax-free, what isn't, and where people get caught out.
Read more →Can I claim benefits afterwards?
How your payment can affect Universal Credit and other benefits.
Read more →Restrictive covenants explained
Non-compete and non-solicit clauses. And whether they'd actually hold up.
Read more →NDA clauses explained
What a confidentiality clause can and can't stop you doing.
Read more →Without prejudice & protected conversations
What these terms mean, and the important exceptions.
Read more →Redundancy vs settlement agreement
How they differ, and how they usually combine.
Read more →ACAS COT3 vs settlement agreement
Two routes to the same kind of outcome. Reached very differently.
Read more →Frequently asked questions
Is this really free?
Yes. Reviewing your settlement agreement and introducing you to a solicitor costs you nothing. Employers almost always include a contribution towards your independent legal advice as part of the agreement, and that’s what covers the solicitor’s fee. See how we’re paid for full detail.
Are you a law firm?
No. SettlementAgreementGuide.co.uk is not a law firm and we don’t give legal advice. We help you understand your agreement in plain terms and introduce you to an independent solicitor who is regulated by the Solicitors Regulation Authority (SRA) and who provides the legal advice and sign-off the law requires.
Do I have to use the solicitor you introduce me to?
No, never. You’re free to use your own solicitor, a trade union representative, or an independent advice centre worker instead. The choice is entirely yours.
How long do I have to decide?
There’s no fixed legal minimum, but ACAS guidance suggests employees should be given at least 10 calendar days to consider a settlement agreement and take advice. See our guide on how long you have to decide.
What happens if I don't sign my settlement agreement?
Nothing is forced on you. An unsigned settlement agreement simply doesn't take effect, and the situation reverts to whatever it would otherwise be: continuing employment, a formal process continuing, or you deciding whether to bring a claim yourself.
What if I've already signed my settlement agreement?
Once properly signed with independent legal advice, a settlement agreement is generally binding and very difficult to unpick. But if you signed without getting that advice, or feel you were pressured or misled, speak to a solicitor as soon as possible to understand your options.
What if I think the offer is too low and want to reject it entirely?
You can decline the offer outright and choose to pursue a claim through the employment tribunal instead, if you believe you have a strong case. This carries more time, cost and uncertainty than accepting a settlement, so it's worth weighing up carefully with your solicitor rather than deciding on the number alone.
Is there a time limit on bringing a tribunal claim?
Yes. Most employment tribunal claims must be started within 3 months less one day of the event you're complaining about, though starting ACAS Early Conciliation can extend this. This deadline runs regardless of whether you've signed anything, so it's worth understanding even if you're still deciding whether to accept a settlement.
What's the difference between a settlement agreement and redundancy?
Redundancy is a reason for dismissal with its own statutory pay entitlement; a settlement agreement is a separate contract, often used alongside redundancy, where you receive an additional payment in exchange for waiving your right to bring claims. See our full redundancy vs settlement agreement guide.
Can I negotiate the terms, or is the offer final?
Almost every settlement agreement is negotiable to some degree, particularly on the first offer. Whether it's worth pushing, and on what terms, depends on the strength of your specific position. Which is exactly what your solicitor will advise on.
Can I bring someone to a redundancy or disciplinary meeting?
For formal disciplinary and grievance hearings, you have a legal right to be accompanied by a colleague or trade union representative. Many employers extend the same courtesy to redundancy consultation meetings, even where it isn't a strict legal requirement. It's always worth asking.
Will my employer know I've contacted you?
No. Contacting us is completely confidential. We never get in touch with your employer, your HR department, or anyone else without your explicit permission. You can explore your options privately, with no risk of anyone at work finding out.
Could this affect my reference or how I'm treated before I sign?
No. Getting independent advice on a settlement agreement (from us or anyone else) is a legal right, and it's confidential. Your employer won't know you've spoken to us, so it can't affect your reference or how you're treated in the meantime.
Is a settlement agreement the same as a compromise agreement?
Yes – "compromise agreement" is the older name for exactly the same kind of document. The law changed the terminology to "settlement agreement" some years ago, but you may still see the old name used.
Been given a settlement agreement?
Send it over, free and with no obligation. We'll pass it straight to an independent, SRA-regulated solicitor for advice. No cost to you.