Everything you need to know about a settlement agreement

Settlement agreements are mainly just rebranding of compromise agreements. Under a settlement agreement, when both the parties have signed off, the employee waives off his right to institute any legal claim or action against his employer. The contract is signed on certain terms, such as, in exchange of a sum of money paid by the employer to his employee in order to not pursue any legal action.

Signing a settlement agreement in Aberdeen can be daunting for an employee. Usually, there are very less chances of a win-win situation. The employee might have to deal with the fact that he is being let go and only a particular sum of money is being paid to him so that he can use it while looking for another job. Also, most employees generally know when their bosses are not happy with them and more or less, are expecting a settlement agreement. However, being served a settlement agreement can come as a great shock to others.

To put it in simplest of the words, a settlement agreement in Aberdeen is mostly a bad news. It means that you are being asked to leave your job, or are being served one immediately after you have been terminated. There are some particular situations where a settlement agreement can be drawn and asked to sign. These are:

  1. Long term sickness

If you have been away from work for a long time and your employer doesn’t want to afford that cost anymore, he can conveniently send you a settlement agreement on the basis of long-term sickness leave. This practice is mostly seen in the private firms where people are working for a private employer.

  1. Performance management at work

It is likely that your boss may not be satisfied with your work. Now, if you think otherwise, you can put up your case and tell him how he is wrong. But if you are indeed subpar at your job and not performing well, then you can be served a settlement agreement under the employment law and asked to leave. This is one of the most common reasons of serving a settlement agreement. Some might call it unfair but the truth is that if your employer wants you to leave and is willing to sign a settlement agreement with you, then there is nothing much you can do about it.

  1. As a means of settling a grievance

The incidents of mental or physical harassments in work places are not unheard of. In fact, according to a survey, such harassment is increasing at a rapid pace. Now, mental harassment may include excessive work load or bad workplace environment. While physical harassment may include sexual advances or too much physical labour. When an employee files such a grievance and the employer doesn’t want to be dragged in the tribunal or court, then he comes up with a settlement agreement which may be beneficial for all. However, it must be remembered that signing a settlement agreement is a choice and an employee is not under any compulsion to sign one.

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