08 July 2013

Settlement Discussions and Agreements

From 29 July 2013, employers wishing to enter into discussions about reaching a mutually agreed termination with an employee will be able to enter into confidential discussions which, provided the appropriate statutory process has been followed, will be inadmissible in any later unfair dismissal claim from the employee. The provisions will not apply to automatic unfair dismissals or where there was improper behaviour during the discussions. In addition, 'compromise agreements' will be renamed as 'settlement agreements'

The new arrangements for pre-negotiation discussions, and the renaming of compromise agreements, are in accordance with s14 and s 23 of the Enterprise and Regulatory Reform Act 2013, and are brought into effect by The Enterprise and Regulatory Reform Act 2013 (Commencement No 2) Order 2013. To read the order click here.

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