Legal Requirements of Your UK Compromise Agreement

There are several requirements that must be met for a compromise agreement to be legally binding in the UK. The following are examples of those requirements:

- The employee must have sought independent (ie different to that of their employer) legal advice before entering into the contract.

- The solicitor which provided the advice must be identified within the agreement.

- Compromise agreements must be in writing.

- The compromise arrangement must be created in line with the relevant legal contractual conditions.

- The agreement must identify the facts upon which, the arrangement has been formed i.e. details of what grievance/s the employee has with their employer.

Is taking legal advice compulsory when creating a compromise agreement?

Yes. Without independent legal advice, a compromise agreement is not valid. This means that the employer does not have to abide by the conditions of the contract, which may include paying out any compensation money.

Compromise agreements often contain complex legal language and due to the nature of the contract and its finality, it is essential that the employee understands exactly what terms they are agreeing to. The solicitor may be able to renegotiate the terms of the compromise agreement so that they are more beneficial for the employee. Alternatively, a solicitor may choose to advise their client that it is more beneficial to take the employer to a tribunal, for example; on a case of discrimination in the workplace. This advice will guide the employee to whether it is appropriate for them to sign the agreement in its current format.

I have signed a compromise agreement and still wish to bring a claim against my employer, where do I stand?

There are only 3 specific areas in which you are still able to take your employer to a tribunal despite signing a contractual compromise agreement:

1) Pension Funds - an employee remains able to claim any pension contributions from their employer that may have accumulated during their employment and have not been paid.

2) Breach of Contract - if the employer does not abide by the terms contained in the compromise agreement then the employee can start legal proceedings. An example of this would be where the employer has not paid the full amount of compensation money agreed upon.

3) Personal Injury Claims - in certain circumstances this type of claim remains valid after the signing of a compromise agreement. One requirement is that the former employee was not aware of the pre-existing injury. If the employee was aware at the point of signing the agreement then a subsequent claim cannot be exercised.

In any event, make sure that when taking advice on a UK compromise agreement, you do so from specialist compromise agreement solicitors.