Can I Still Pursue A Tribunal Claim After Signing A Settlement Agreement?
By Geoffrey Caesar, specialist settlement agreement solicitor.
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No, in most cases, signing a settlement agreement means that you will not be able to pursue a tribunal claim. A settlement agreement is designed to be a legally binding contract between you and your employer, where you agree to waive certain rights in exchange for compensation or other benefits. One of the key aspects of a settlement agreement is that it usually includes a waiver of claims, meaning that you’re agreeing not to bring any further legal claims, such as an employment tribunal claim, against your employer.
However, there are certain nuances to be aware of. Let’s explore in detail what a settlement agreement typically covers, any potential exceptions to this rule, and what steps to take to ensure you’re not waiving important rights unknowingly.
1. Understanding the Purpose of a Settlement Agreement
A settlement agreement is primarily intended to settle all disputes between an employee and employer. It’s a mutually agreed-upon resolution to avoid the costs, time, and uncertainty of going to an employment tribunal. In return for waiving your rights to pursue future claims, you receive compensation and possibly other benefits, such as an agreed reference, continued healthcare coverage, or career coaching support.
When you sign a settlement agreement, you usually agree to release your employer from liability for a wide range of potential claims, including those related to unfair dismissal, discrimination, breach of contract, and other common employment disputes. This waiver is what legally prevents you from pursuing a tribunal claim after signing.
2. Waivers and the Importance of Legal Advice
One of the essential requirements of a valid settlement agreement is that you receive independent legal advice before signing it. This is because the agreement involves waiving significant legal rights, and it’s crucial that you understand fully what rights you’re giving up and what claims you’re settling.
Your solicitor’s role is to explain the terms and effect of the waiver to you, helping you assess whether the compensation offered is fair and whether it’s worth giving up your right to pursue claims. Your solicitor will review:
- The scope of claims being waived: Most settlement agreements aim to cover a broad range of claims, from unfair dismissal to discrimination. Understanding the scope of this waiver is crucial, as it typically bars you from bringing up any claims related to your employment that occurred up until the date you sign the agreement.
- Fairness of the offer: A solicitor will evaluate whether the compensation offered reflects the strength of your claims and the potential outcomes of a tribunal. They will negotiate on your behalf if they feel that the offer is too low or if the terms need clarification.
3. Potential Exceptions: Claims That May Not Be Waived
Although a settlement agreement generally prevents you from pursuing tribunal claims, there are some exceptions. Certain claims cannot legally be waived, either because they relate to issues outside the scope of employment or because they arise after the settlement agreement is signed. Some examples include:
- Personal Injury Claims: Claims for personal injury that are unknown to you at the time of signing are typically not covered. For instance, if you discover a work-related injury or illness after signing, you may still be able to bring a claim for that.
- Future Claims: Any claims that arise after the date the settlement agreement is signed are not waived. For example, if your employer breaches the terms of the agreement, you may be able to pursue a claim for that breach, as it occurred after the agreement was signed.
- Pension Rights: Your statutory rights to any accrued pension benefits are protected and cannot be waived in a settlement agreement.
- Claims under certain statutory protections: Rights that relate to workplace health and safety or whistleblowing are sometimes treated differently, as they are strongly protected under UK law.
Key Takeaway: While settlement agreements cover most employment-related claims, your solicitor will help ensure that non-waivable claims are clearly identified and preserved, so you’re not inadvertently giving up critical rights.
4. What if You Believe the Agreement Was Signed Under Duress?
In some rare cases, an employee may feel that they were pressured or coerced into signing a settlement agreement. If you believe you signed under duress, such as due to threats, undue influence, or misinformation, it might be possible to challenge the validity of the agreement in certain circumstances.
However, proving duress is difficult and often requires substantial evidence. If successful, challenging the agreement on these grounds could allow you to pursue a claim that would otherwise have been waived. Seeking advice from an employment solicitor experienced in dispute resolution is essential if you believe you have grounds to contest the agreement’s validity.
5. What About Claims for Breach of the Settlement Agreement?
If you signed a settlement agreement and later discover that your employer failed to fulfill their end of the bargain, you might be able to bring a claim for breach of contract. Examples of breaches might include:
- Non-payment: If your employer fails to pay the agreed settlement sum by the date specified, this is a breach of the settlement agreement.
- Failure to provide an agreed reference: If the settlement includes a reference clause and the employer refuses to provide this or provides an inaccurate reference, it could be a breach.
- Violations of confidentiality or non-disparagement clauses: If the agreement includes confidentiality or non-disparagement clauses and your employer fails to comply, you may have grounds for a claim.
Key Takeaway: Claims for breach of the settlement agreement are separate from employment claims waived within the agreement itself. If your employer breaches the agreement, you retain the right to enforce it, including potentially taking legal action for compensation or specific performance.
6. Steps to Take Before Signing a Settlement Agreement
To avoid issues with waivers, rights, or enforceability, follow these key steps before signing any settlement agreement:
- Consult with an Employment Solicitor: Your solicitor will clarify what claims you are waiving, help you understand the financial and non-financial terms, and advise you on whether the settlement is fair.
- Identify Potential Claims: Discuss with your solicitor any potential claims you may have, including discrimination, unfair dismissal, or breach of contract. Understanding the strength of these claims will help you negotiate better terms.
- Review the Specific Waivers and Terms: Ensure that any non-waivable rights or protected claims (such as future claims or pension rights) are clearly preserved in the agreement. Your solicitor can help draft these protections into the agreement if necessary.
Key Takeaway: A careful review with your solicitor will help prevent misunderstandings and protect you from inadvertently waiving important rights or claims.
7. Final Thoughts: Is Signing the Settlement Agreement the Right Choice?
Settlement agreements offer a straightforward, amicable path to resolving employment disputes without the need for a tribunal. However, because they involve waiving certain rights, it’s important to approach them carefully.
If you feel the settlement offer is fair and adequately compensates you for potential claims, signing the agreement can provide closure and a swift resolution, allowing you to move on without the risks or costs associated with a tribunal. However, if you believe you have a strong claim that the settlement does not fully address, discussing your options with your solicitor before signing is critical.
In summary, signing a settlement agreement typically prevents you from pursuing further claims against your employer. By securing independent legal advice, you can ensure you understand the full implications of signing, receive fair compensation, and protect any non-waivable rights you may have.
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