The government’s recent employment law reforms, which came into effect earlier this month, include the renaming of Compromise Agreements to Settlement Agreements. This renaming issue seems to have gone largely unreported. The rationale behind the changes is, apparently, that the word ‘compromise’ prompts connotations of inequality when it comes to negotiation of a fair settlement and that a departing employee may be ‘compromising’ their employment law rights. Hence the new name Settlement Agreement is supposed to “emphasise the benefits they can offer as a way of resolving and bringing finality to disputes.”
It has also been suggested that the renaming will assist in the reduction of restrictive regulations and better protect the rights of employees. Given that Settlement Agreement is an existing term used mainly in reference to post-divorce financial settlement however, confusion could arise. It is quite likely therefore that the term Compromise Agreement will remain in prolific use for some time to come, amongst the general public and the legal profession alike.
In response to concerns, particularly from smaller firms, concerning the complex terminology used in the UK Compromise Agreement, the government is also investigating ways to produce a ‘model’ Agreement. This would however still need to allow for flexibility for both parties to incorporate specific wording relevant to a departing employee’s circumstances, such as the provision of a job reference, handover responsibilities, provision for gardening leave, the return of specific company property and so on.
Regardless of whether or not you referred to a “settlement agreement” or an “employment compromise agreement”, if you would like more information about these legal documents and how they work, why not visit our specialist http://www.compromiseagreementsolicitorsuk.co.uk website, or call our specialist employment team on  422300. Wherever you are located throughout England and Wales we can help you. Our team regularly advise and negotiate on compromise agreements throughout England and Wales – and don’t need a face-to-face meeting with our clients to do so – we are able to take instructions and provide specialist compromise agreement advice by e-mail, telephone and Skype video.