If you’ve been offered a settlement agreement by your employer, you might be wondering whether you really need to get legal advice. The short answer is yes – it’s not just recommended, it’s a legal requirement in the UK. Let’s explore why this is the case and what it means for you.
The Legal Requirement for Independent Advice
Under UK employment law, a settlement agreement is only legally valid if you’ve received independent legal advice on its terms and effects. This requirement is set out in Section 203 of the Employment Rights Act 1996. Without this advice, the agreement won’t be binding, and you won’t be able to receive your settlement payment.
Why Does the Law Require Legal Advice?
The requirement for legal advice exists to protect employees. When you sign a settlement agreement, you’re giving up your right to make claims against your employer. This is a significant legal step, and the law wants to ensure that:
- You understand exactly what rights you’re giving up
- You know what you’re getting in return
- You’re making an informed decision
- You’re not being pressured into accepting unfair terms
Who Pays for the Legal Advice?
Here’s some good news – typically, your employer will cover the cost of the legal advice. Most settlement agreements include a contribution towards legal fees, usually between £350 and £750 plus VAT. This should cover the cost of:
- Reviewing the agreement
- Meeting with you to explain the terms
- Advising on whether it’s a fair deal
- Making any necessary amendments
- Signing the adviser’s certificate
What Does the Legal Advice Cover?
When you meet with your legal adviser, they’ll typically cover:
1. Terms of the Agreement
- Payment amounts and timing
- Tax implications
- Notice periods
- Holiday pay
- Company property returns
- References
- Confidentiality clauses
- Post-employment restrictions
2. Your Specific Situation
- The circumstances leading to the agreement
- Whether you have any potential claims
- The value of those claims
- Whether the settlement amount is fair
3. Practical Implications
- How the agreement affects your future employment
- What you can and can’t say about the agreement
- References and future job applications
- Any restrictions on working for competitors
Can I Negotiate Better Terms?
Your legal adviser can help you negotiate better terms if they believe the current offer isn’t fair. They might suggest improvements to:
- The financial settlement
- Reference wording
- Post-employment restrictions
- Other terms and conditions
What Happens During the Legal Advice Process?
- Initial Contact
- Book an appointment with a qualified adviser
- Send them the agreement to review
- Provide background information
- Consultation
- Discuss your situation
- Go through the agreement in detail
- Ask questions and get clarification
- Receive advice on fairness and options
- Next Steps
- Decide whether to accept, negotiate, or reject
- Get the adviser’s certificate signed
- Complete the agreement process
Common Questions About Legal Advice
“Can’t I just sign without advice?”
No – the agreement won’t be legally valid without independent legal advice. Your employer won’t pay out the settlement sum without a properly signed agreement.
“Can I use any lawyer?”
The adviser must be a qualified lawyer, certified trade union representative, or certified advice worker with professional indemnity insurance. They must be named in the agreement and sign a certificate confirming they’ve given advice.
“How long does it take?”
Usually, the process takes about an hour for straightforward agreements. Your adviser should be able to complete everything in a single meeting unless negotiations are needed.
“What if I don’t agree with the terms?”
You’re not obligated to sign the agreement. Your adviser can help you negotiate better terms or explain your alternatives, such as pursuing an employment tribunal claim. See our post on negotiating settlement agreements for more information.
Making the Most of Your Legal Advice
To get the most value from your legal advice session:
- Read the agreement beforehand and note any questions
- Gather relevant documents about your employment
- Be honest with your adviser about your situation
- Ask questions if anything is unclear
- Take notes during the meeting
Next Steps
If you’ve been offered a settlement agreement, don’t delay getting legal advice. Most employers will set a deadline for signing the agreement, and you’ll want time to consider your options and negotiate if necessary.
At checkmysettlement.com, we make the process simple:
- Book an online appointment at a time that suits you
- Meet with an experienced employment lawyer via video call
- Get clear, practical advice about your agreement
- All covered by your employer’s contribution
Conclusion
Getting legal advice on your settlement agreement isn’t just a box-ticking exercise – it’s an important step in protecting your interests and ensuring you get a fair deal. The advice is typically free to you, paid for by your employer, and helps you make an informed decision about your future.
Ready to get advice on your settlement agreement? Book your meeting with one of our expert advisers today.