If you have been offered a settlement agreement, we give you free, specialist advice, and in almost every case your employer pays our fee. You speak to a named employment solicitor who reviews your agreement the same day, tells you plainly whether the offer is fair, and negotiates for more where your claim supports it. There is normally nothing for you to pay.
A settlement agreement is one of the most important documents you will ever sign at work. It ends your employment on agreed terms and, once signed, stops you bringing almost any claim against your employer. That finality is exactly why the law says you must take independent advice before it is binding, and why getting the right advice matters so much. This page explains what a settlement agreement is, how the money and tax work, what we do for you, and how to get started today.
Based in London? See our settlement agreement solicitors London page for local advice, employer contributions and same-day review.
What is a settlement agreement?
A settlement agreement (once called a compromise agreement) is a legally binding contract between you and your employer. In it, you agree not to pursue employment claims in a tribunal or court, and in return you receive a payment and agreed terms. Employers use them to draw a clean line under an exit or a dispute, whether that is a redundancy, a performance or capability process, a restructure, or a negotiated departure. For a settlement agreement to be valid it must be in writing, relate to particular claims, and be advised on by an independent adviser (usually a solicitor). For the detail, read our full guide, what is a settlement agreement.
How much should you get?
Your figure has two parts. First, everything you are owed anyway: notice pay, unpaid salary, accrued holiday, and statutory redundancy if it applies. Second, a separate compensation (ex gratia) payment on top, which is the genuinely negotiable part and is often the equivalent of one to six months' gross pay, driven mainly by the strength of the claims you are giving up. Judge an offer on that second part, not the headline. Get a quick estimate from the settlement agreement calculator.
What about tax?
Broadly, genuine compensation for losing your job is tax-free up to £30,000, while notice pay, salary, holiday and bonuses are taxed as normal earnings. How the payment is split between these decides your actual take-home, so structuring it correctly can be worth more than a small increase in the total.
Free advice, your employer pays
Because independent legal advice is a legal requirement for the agreement to be valid, employers contribute towards your legal fees as standard. The contribution is written into the agreement and paid directly to us, which also keeps it tax-free. For a standard agreement that normally covers the whole cost, so you pay nothing. If your matter is more complex, or you want us to negotiate hard for a better deal, we tell you up front and agree it with you first. See our pricing for how it works.
What we do for you
- Review your agreement the same day we receive it.
- Explain, in plain English, what is fair and what is not.
- Value any claims you may have (unfair dismissal, discrimination, whistleblowing, redundancy).
- Negotiate for a better outcome where the leverage is there.
- Check the tax structure so you keep as much as the rules allow.
- Make sure references, restrictive covenants and confidentiality work for you, not just your employer.
- Get it signed off properly, with a named solicitor accountable.
Why Deen & Co
Every firm in this market makes the same promises. The difference here is simple: a named, specialist solicitor reads your agreement and handles your case personally, not a call centre and not a chatbot. Deen & Co is a boutique employment practice led by Taj Ahmed, who has more than twenty years' experience and has advised on thousands of settlement agreements for employees across England and Wales. See our settlement agreement solicitors page and what clients say.
Where we help
We are based in Canary Wharf and advise employees across London and, by phone, across England and Wales. See our nationwide settlement agreement service or the full list of areas we cover.
Get started today
Send us your agreement and your employment contract, and we will book you a review with a specialist solicitor, usually the same day. Request a callback or call us now.
What it costs you
Your employer will usually include a contribution to your legal fees in the settlement agreement, often a few hundred pounds plus VAT, and more for senior roles. In almost every case, that contribution covers our fee in full, and we invoice your employer directly. You pay nothing, and none of it comes out of your settlement.
Where your offer can be improved, we will tell you, and we will negotiate with your employer for you. We tell you before any extra cost could arise.
FAQ
Is it really free?
For a standard agreement, yes. Your employer's contribution normally covers our fee, paid directly to us.
How quickly can you review it?
Usually the same day we receive it.
Can you negotiate more?
Yes, where your claim supports it. We will tell you honestly what is realistic.
Do I have to take advice?
Yes. A settlement agreement is not legally binding until you have taken independent advice, which is why your employer pays for it.
What happens if I refuse?
Nothing automatic. Refusing is not misconduct and does not end your employment. In practice one of three things follows: the offer improves, it stays open, or your employer continues with whatever process they had already started. Refusing keeps your claims rather than waiving them. What happens if you refuse a settlement agreement.
How long do I have to decide?
The ACAS Code of Practice recommends a minimum of 10 calendar days to consider a written offer and take independent advice. Shorter deadlines are common but are not the standard the Code sets, and asking for more time is a reasonable request. How long you have to decide.
Is my settlement payment tax free?
Up to £30,000 of a genuine termination payment can usually be paid free of income tax. Notice pay, holiday pay and contractual bonuses are taxed in full. Since April 2018 all payment in lieu of notice is taxable, whether or not your contract allows for it. Our full guide to settlement agreement tax.
My employer said the conversation was "without prejudice". What does that mean?
It means they intend the discussion to be off the record. It is not a magic phrase. Protection under section 111A only applies to ordinary unfair dismissal claims, so it does not cover discrimination, whistleblowing or breach of contract, and improper behaviour removes it entirely. Protected conversations and without prejudice explained.
Can they put me on a performance improvement plan and offer a settlement at the same time?
Yes, and it is common. It is often used to present two routes at once: improve, or leave on agreed terms. They are different things. A capability process has standards it must meet; a settlement offer is a negotiation. Neither requires you to decide immediately. Weighing up whether to accept an offer.
How much should I get?
There is no fixed formula. A reasonable settlement usually reflects your notice entitlement, any redundancy pay, accrued holiday, and then a further sum reflecting the strength of any claims and what it would cost your employer to defend them. How much a settlement agreement should be worth.
Can I still go to a tribunal after signing?
Generally no, and that is the point of the agreement. You waive the listed claims in exchange for the payment. This is why identifying every claim you might have before signing matters more than the headline figure. The evidence a tribunal claim would need.
What reference will they give me?
An agreed reference can be written into the agreement with the exact wording attached, which removes the uncertainty about what your next employer will be told. It often costs your employer nothing, which makes it one of the easier things to ask for. How to negotiate terms like an agreed reference.