If you find yourself in the unfortunate position of being made redundant, you may be offered a compromise agreement by your employer. This is a legally binding agreement which outlines the terms of your departure and any compensation or benefits you may be entitled to.
So, how does a compromise agreement work?
Firstly, it`s important to note that a compromise agreement is a voluntary agreement between you and your employer. It`s not something that can be forced upon you, and you have the right to seek legal advice before signing it.
The agreement will typically include the following elements:
1. Termination date – this will be the date that your employment officially ends.
2. Compensation – this may include a lump sum payment or a series of payments, and it`s important to note that this compensation may be tax-free up to a certain amount.
3. Restrictive covenants – this is a clause that may prevent you from working for a competitor for a certain period of time or from poaching your former employer`s clients.
4. Confidentiality – you may be required to keep confidential any information you have gained during your employment.
It`s important to note that a compromise agreement is a legally binding document and once it`s signed, you waive your right to bring any future claims against your employer. This means that if you have any outstanding grievances or issues with your employer, you should bring them up before signing the agreement.
It`s also worth mentioning that a compromise agreement may not be suitable for everyone. If you believe that you`ve been unfairly dismissed or discriminated against, you may want to seek separate legal advice and explore other options such as lodging a claim with an employment tribunal.
In summary, a compromise agreement is a voluntary agreement between you and your employer that outlines the terms of your departure and any compensation or benefits you may be entitled to. Before signing any agreement, it`s important to seek legal advice and ensure that you fully understand the terms and conditions.