Miller Samuel provides quality legal advice throughout the UK and beyond. Our specialist teams work closely together, providing tailored and innovative solutions for our clients.
Government sets out plans for settlement agreements
The Government has outlined its proposals for reform of the workplace dispute resolution process as the Enterprise and Regulatory Reform Bill gets its second reading.
The Government is proposing that employers will be able to offer settlement agreements before a formal dispute arises and will be legally protected from this offer being used as evidence in an unfair dismissal tribunal case. Employees will also continue to enjoy full protection of their employment rights, as they can choose to reject the offer of a settlement agreement and proceed to a tribunal. Evidence from the private sector shows that a sensible compromise can be reached in the majority of cases.
The agreements are currently available for employers in some circumstances. However, Government wants to encourage more businesses to use them, including before they have reached the stage of a formal dispute. By making settlement offers and discussions inadmissible in unfair dismissal claims, businesses can be more confident that they will not be used against them at a tribunal.
Employment Relations Minister Norman Lamb said:
“There are inevitably occasions when the employment relationship doesn't work out. Employers have to feel confident in dealing with situations such as where an employee isn't pulling their weight or where someone is unreliable or even guilty of misconduct.
“In these instances it is sometimes in the best interests of both employee and employer to end the relationship speedily by reaching a settlement. An employee leaving by agreement can do so with their dignity intact. The employer secures peace of mind knowing that they will not face expensive tribunal proceedings.”