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Being offered a settlement agreement can feel overwhelming. You’ve got days to decide, legal documents you don’t fully understand, and a lot at stake. Whether you’re an employee trying to get the best deal when leaving a job, or an employer who needs agreements drafted, signed, and watertight, you need specialist settlement agreement solicitors you can trust.
We’re Darwin Gray, one of Wales’ leading employment law firms and specialist settlement agreement solicitors for both employees and employers. We advise on hundreds of settlement agreements every year, across every industry and at every level. We’ll tell you honestly whether the deal on the table is fair, negotiate better terms where we can, and make sure the agreement is legally sound before you sign anything.
To speak to an employment law consultant today, call us on 02920 829 100 or use our Contact us form.
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A settlement agreement (previously called a compromise agreement) is a legally binding contract between an employer and employee. In it, the employee agrees to waive their right to bring legal claims, employment tribunal or court claims against the employer, usually in return for a financial settlement, payment and other agreed terms. In effect, a settlement agreement subjects an individual to a clean-break scenario where they can’t bring any claims against the employer.
For a settlement agreement to be legally valid under Section 203 of the Employment Rights Act 1996, it must:
That last point is critical. The employee must seek legal advice and receive independent legal advice before signing. Without it, the agreement isn’t legally binding. It’s also why employers typically agree to pay a contribution towards the employee’s legal costs.
Settlement agreements are used in a wide range of situations: redundancy exits, performance disputes, disciplinary situations, discrimination concerns, senior executive departures, workplace relationship breakdowns, and commercial negotiations. They’re often the quickest, most cost-effective way to resolve an employment situation for both sides.
If your employer has offered you a settlement agreement, the most important thing to know is this: you don’t have to sign. And before you even consider signing, you need independent legal advice from a specialist solicitor to go through the settlement agreement process. That’s not just good sense, it’s a legal requirement.
We act exclusively for you as the employee. Our job is to make sure you understand exactly what you’re agreeing to, check whether the offer is fair, negotiate better terms if there’s room to do so, and ensure you’re not giving up more than you should.
Review your agreement: We go through every clause carefully. Termination payment, tax treatment, post-termination restrictions, confidentiality obligations, reference terms, share options, bonus entitlements, pension contributions. We explain what each clause means in plain English and flag anything that could affect you. We may also need to look at some clauses of your employment contract.
Assess whether the offer is fair: Is the compensation reasonable given your circumstances? Have your notice, holiday pay, and other contractual entitlements been included? Does the agreement waive claims worth more than you’re being paid? We give you an honest view.
Negotiate better terms: Our expert employment lawyers regularly negotiate improved packages for employees. Higher compensation, better reference wording, removal of unfair restrictive covenants, extended garden leave, retention of company equipment. Employers often have room to move, especially if there are underlying claims.
Flag claims you might not know about: Many employees don’t realise they have potential unfair dismissal, discrimination, or breach of contract claims worth more than what’s being offered. We assess your underlying position and advise you whether signing immediately makes sense or whether you have leverage to negotiate.
Make sure you’re legally protected: The agreement needs to correctly waive specified claims. If it doesn’t, or if it contains flawed provisions, it might not protect the employer as intended, which can cause problems later. We confirm the document is properly drafted.
Act quickly when time is short: Employers often impose tight deadlines (minimum 10 days under ACAS code, but sometimes more urgent). We respond fast. Call us today and we can often turn around advice within 24-48 hours.
As soon as you’re offered one. Don’t sign anything before speaking to us, even if your employer is pressuring you to decide quickly. The ACAS Code of Practice says employees should normally have at least 10 calendar days to consider a settlement offer. You’re entitled to take that time.
Contact us immediately if any of the following apply:
Settlement agreements are a specialist area. They sit at the intersection of employment rights, tax law, contractual obligations, and negotiation strategy. We’re specialist employment law solicitors who advise on settlement agreements daily. You get real expertise, not a generalist who does settlements occasionally.
Many settlement agreement solicitors simply review the document, certify the advice, and let you sign. We go further. We assess whether the deal is genuinely fair, tell you honestly if it isn’t, and negotiate on your behalf when there’s room to do so. Employees regularly leave with significantly better packages after we get involved.
Settlement agreement deadlines are often tight. We respond quickly, sometimes same day for urgent situations. You won’t be left waiting days for an appointment while your deadline ticks closer. Call us, explain the urgency, and we’ll move fast.
You’ll speak directly to the specialist solicitor handling your matter. Not a trainee, not a paralegal, not a call centre. Direct access to the qualified employment solicitor who’s read your agreement, assessed your position, and knows your case.
We’re Wales’ leading commercial law firm offering a Welsh language employment law services at every level. If you want to discuss your settlement agreement in Welsh, receive advice in Welsh, or have documents reviewed with Welsh language consideration, we’re the only firm in Wales that can provide that seamlessly.
We advise employees and employers, which means we understand both perspectives. When we’re advising an employee, we know exactly what employers are trying to protect and where they have flexibility. When we’re advising an employer, we know exactly what experienced employee solicitors will challenge. That dual perspective makes us better advisers.
Our settlement agreement solicitors advise employees and employers across Wales and the whole of the UK. Cardiff, Bangor, Swansea, and beyond. If you need settlement agreement solicitors near me, we’re here, and we work remotely too so wherever you are, we can help.
Over 20 years of employment law expertise | Welsh and English language services | Ranked in Legal 500 for Employment Law
Call us or complete our online form. Tell us briefly what’s happening: you’ve been offered a settlement agreement, you’re an employer who needs one drafted, you want legal advice before signing. We’ll arrange a call, usually same day or next morning.
Email us your settlement agreement and any relevant correspondence. We read everything carefully before we speak to you: the draft agreement, any without prejudice correspondence, your contract of employment, and anything else relevant to your situation.
We walk through the agreement with you, explain every clause in plain English, tell you what rights you’re being asked to waive, assess whether the offer is fair given your position, flag any concerns, and explain your options clearly. Employees: we tell you whether to accept, negotiate, or reject. Employers: we advise on what to change before the agreement goes out.
If the terms aren’t right, we negotiate. For employees, that typically means going back to the employer’s solicitors to push for higher compensation, better reference wording, removal of unfair restrictions, or clarification of tax treatment. For employers, it means refining the agreement to address employee concerns without giving away more than necessary.
Once terms are agreed, we certify the advice (a legal requirement) and the agreement is executed. We handle all the paperwork. For employees, we make sure your employer pays the agreed contribution towards our costs. For employers, we make sure the agreement is correctly signed and enforceable.
Typical timescale: Initial advice (1-2 days) | Negotiation (3-7 days) | Final signing (1-2 days) | Total (5-14 days typically, faster when urgent)
I used Darwin Gray recently and found their service to be outstanding, and great value. I would not hesitate to recommend this law firm. 5 stars well deserved.
Chris Rees
Darwin Gray are a very resourceful and ambitious practice. They have a wide breath of areas in which they advise and recruit extremely well, with a number of very talented junior lawyers. They are approachable and responsive.
Legal 500
No. Signing is completely voluntary. You can reject the agreement and pursue your employment claims through tribunal instead. Your employer can’t force you to sign. However, if you reject it, your employer will likely proceed with dismissal through a formal route (redundancy, performance management, disciplinary), which may leave you worse off financially than the settlement offer. We’ll help you compare both options honestly.
Yes. The settlement agreement is only legally binding if you’ve received independent legal advice from a qualified legal adviser (solicitor, barrister, or certified trade union representative) who is identified in the agreement and holds relevant insurance. Without this, the agreement is invalid. This is why employers pay a contribution towards your legal costs, it’s in their interest for you to take proper advice.
Usually the cost is covered by the employer. Settlement agreements routinely include a clause where the employer pays a contribution to the employee’s specialist legal advice. This covers our costs for most standard agreements. For complex negotiations or extensive advice, we’ll discuss costs upfront. You won’t face surprise bills.
Yes, and this is one of the most valuable things we do. You don’t have to accept the first offer. We assess whether the deal is fair, advise where there’s room to negotiate, and go back to the employer’s solicitors on your behalf. We regularly secure improved terms: higher compensation, better reference wording, removal of restrictive covenants, payment of notice or bonus entitlements that weren’t originally included.
The ACAS Code of Practice says employees should have at least 10 calendar days to consider a settlement offer, unless both parties agree otherwise. Your employer can’t override this without your consent. If you’re being pressured to decide faster, call us. We’ll advise on your rights and, if necessary, communicate directly with the employer’s solicitors to ensure proper time is given.
Payments typically include some or all of: notice pay, statutory redundancy pay (if applicable), an ex gratia payment (compensation for waiving claims, first £30,000 often tax-free), accrued holiday pay, any contractual bonuses or commission, share options or LTIP payments, and pension contributions. What you receive depends on your contract, length of service, and the strength of any underlying claims. We check everything is accounted for.
It depends on what the payment represents. Payments in lieu of notice (PILON) are taxable. Statutory redundancy pay and ex gratia payments up to £30,000 can be free of tax and national insurance contributions (above £30,000 is taxable). Accrued holiday pay is taxable. Compensation for injury to feelings can sometimes be tax-free. We advise on the tax treatment in your agreement and flag anything that looks wrongly categorised.
Yes. Restrictive covenants limiting your ability to work for competitors, solicit clients, or approach former colleagues are often included in settlement agreements. These can have a real impact on your next role. We review whether the restrictions are reasonable in scope, geography, and duration, and negotiate removal or narrowing where appropriate. Unreasonable restrictions are often unenforceable anyway, but having them removed or limited in the agreement itself gives clearer protection.
Yes. You can negotiate terms even after employment has ended, as long as you haven’t already signed the agreement. Time limits for bringing tribunal claims still apply (usually 3 months from the act complained of), so don’t leave it too long. If your former employer has made a settlement offer post-employment, we can still advise, review, and negotiate on your behalf.
Strongly recommended, yes. A poorly drafted agreement that fails to correctly identify and waive specific claims can be challenged by the employee later. If the waiver clauses aren’t precise, or if required formalities are missed, the agreement may not protect you as intended. We draft agreements that are legally sound, commercially balanced, and built to withstand scrutiny.
Yes, and reference terms are one of the most negotiated elements. The agreement can specify who provides the reference, what form it takes (letter or verbal HR confirmation), what it says, and when it’s provided. As an employee, having the exact wording agreed in the settlement agreement prevents your employer from giving a poor verbal reference later. We negotiate reference terms on your behalf.
A COT3 is a settlement reached through ACAS early conciliation and recorded by ACAS. A settlement agreement is an independently drafted document. Both are legally binding. COT3s can settle future claims more flexibly but require ACAS involvement. A valid settlement agreements give you more flexibility on terms (reference wording, confidentiality, restrictive covenants) but must meet specific legal requirements. We advise on which is appropriate for your situation.
We have offices in Cardiff and Bangor, with employment lawyers advising individuals and businesses across Wales and the UK. Most settlement agreement advice is handled remotely (video call or telephone) so wherever you are, we can help quickly.
Cardiff office: Serving South Wales including Swansea, Newport, Bridgend, Merthyr Tydfil, the Vale of Glamorgan, and beyond.
Bangor office: Serving North Wales including Wrexham, Anglesey, Flintshire, and the wider North Wales region.
For clients searching for settlement agreement solicitors near me anywhere in Wales, we’re the clear choice. We’re Wales’ leading Welsh language commercial law firm, the only firm offering full bilingual employment law services at every level.
We also advise clients across England, Scotland, and Northern Ireland. Settlement agreement work is well-suited to remote delivery, and our expertise speaks for itself regardless of geography.
Whether you’ve just been handed a settlement agreement, or you’re an employer needing expert help to exit an employee cleanly, we’re ready to help. Quick, specialist, and direct.
For employees: we’ll tell you honestly if the offer is fair, negotiate better terms where we can, and make sure you understand exactly what you’re signing. Our advice is covered by your employer’s legal fees contribution in most cases.
For employers: we draft legally sound, commercially balanced agreements that protect your business and bring certainty. Fast turnaround, fixed fees wherever possible.
If you have been offered a settlement agreement from your employer, please contact a member of our employment law team in confidence here or on 02920 829 100 for a free initial call to see how they can help.
To speak to one of our experts today, please contact us on 02920 829 100 or by using our Contact Us form for a free initial chat to see how we can help.
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