Compromise Agreement - Rules

Smudger78

Hi All,

I'm currently in the consultation period for redundancy with a view to being served notice of redundancy 1st Oct. I am due 12 wks notice which takes me to the end of the year but have started 'negotiating' for an earlier release under a compromise agreement. It's looking likely my request will be granted and they'll make me an offer of a lump sum equivalent to my notice period pay and in the process save themselves and me the tax/ni which would be paid if I sat it out on garden leave for 3 months. The concern I have is that there could be a chance of me getting another job quickly (contacts with previous employer) but I would not want this to jeopardise my pay off. I know, it's not the worst problem to have....

Obviously I'm playing my cards close to my chest with my employer but what I want to understand is the point at which they cannot retract their offer. Is it after they've put it in writing and I have accepted or could they literally withdraw it the day before I am due to receive my payment? My nightmare scenario would be them receiving a reference request from a new employer the day before I was due to receive my compromise payment and them withdrawing it! Could this happen? Does anyone have any experience of this or knowledge of the law in this area? I would add that my employer is a large organisation who generally treat people fairly so I wouldn't them doing anything particularly underhand but I guess you never know.....

Thanks

Smudger

princessdon

Once signed by both parties (and the legal/union rep) it becomes legal and valid.

Till then it's not

sdlaw2905

As mentioned previously, as soon as signed by both parties it becomes a legally binding contract. At the point your employers draw up a compromise agreement they will inform you that you have got to consult a solicitor, your employer will pay solicitors fees (usually capped at £250 - £300).

Your solicitor will check through the agreement and can ask for amendments to be made, you can ask for your solicitor to request confirmation that your employer will give you a reference, you can also ask for a copy of the reference that they will provide.

I went through similar and my solicitor requested several changes to wording, confirmation of reference contents etc.

Usually there will be an agreement that you will receive payment within 14 days of the signed / witnessed documents being received.

Good luck