Careers and pay
Settlement agreement
A legally binding agreement, usually when leaving a job, where you receive a payment in exchange for giving up the right to bring claims against your employer. In the UK you must get independent legal advice for it to count, and the employer normally pays for that advice.
A plain-English explanation of how this usually works in the UK, not legal advice. Rules change, so check your own situation. For free, impartial advice on work rights, try Acas. Disclaimer.
You'll hear it as
They've offered a settlement agreement with three months' pay.
Why it matters to you.
Don't sign quickly. The legal advice is free to you, and the first offer is usually negotiable.
Related terms.
Videos.
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