12 June 2024

English EAT agrees with Court of Session that unknown future claims can be settled

Section 147 of the Equality Act 2010 (EqA),  concerns qualifying Settlement Agreements, and states that the Agreement must relate to a “particular complaint”.  This has led to judgments that a settlement agreement cannot settle future claims that the employee is unaware of.  In Bathgate v Technip Singapore PTE Ltd (2023), the Court of Session (CS) overturned that principle.  Bathgate signed a settlement agreement but subsequently brought an age discrimination claim.  The EAT held that a Settlement Agreement could not settle unknown future discrimination claims and was clear that Bathgate signed away his right to sue for age discrimination before he knew whether he had a claim or not.  The EAT went on to hold that the mere inclusion of a claim in a settlement agreement defined only by reference to its legal character or its section number does not satisfy the language of section 147 EqA, and that the words “the particular complaint” suggest that Parliament anticipated the existence of an actual complaint or circumstances where the grounds for a complaint existed.

The employer appealed to the CS.  The CS held that Bathgate’s age discrimination claim had been validly settled by the Settlement Agreement.  The Agreement stated that it constituted full and final settlement of the claims that the Claimant “intimates and asserts”, and listed various types of claims, including age discrimination. The agreement also included a general waiver of “all claims… of whatever nature (whether past, present or future)”.  The CS was clear that a future claim of which an employee does not and could not have knowledge, may be covered by a waiver where it is plain and unequivocal that this was intended.  In the CS’s view, the requirement under s147 EqA for the contract to relate to a ‘particular complaint simply requires “one to ask whether the complaint being made is or is not covered by the terms of the contract. They import no temporal barrier to post-employment claims of the kind”. 

Although the CS decision does not set precedent for courts in England and Wales, it is persuasive, and the EAT in Clifford v IBM (2024)  has now followed the decision in Bathgate.  Mr Clifford entered into a Settlement Agreement with IBM in which he waived the right to bring various specified claims, including disability discrimination claims, whether or not they were or could be in the contemplation of the parties at the date of the Agreement.  Clifford brought a claim of disability discrimination, which an employment tribunal struck out. On appeal the EAT agreed with the tribunal that Clifford was precluded from bringing a claim.  It was a future claim but was clearly barred by the terms of the Agreement.

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