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Form #1662

Compromise Agreement Short Form

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A simple agreement between an employer and an employee to compromise an employee's contractual and statutory claims on termination of employment.

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Compromise agreement (short form)

Resource type: Standard document

Status: Maintained

 

 

A simple agreement between an employer and an employee to compromise an employee's contractual and statutory claims on termination of employment.

 

 

Contents

1.   Termination date

2.   Payment

3.   Pension and Benefits

4.   Waiver

5.   Return of property

6.   Confidentiality and other restrictions

7.   Legal advice and fees

8.   Subject to contract and without prejudice

9.   Entire agreement

10. Governing law and jurisdiction

Schedules

1.   Claims

2.   Adviser's certificate

Note: General document notes

This is dated [DATE]

PARTIES

Note: Parties clause

(1) [EMPLOYER] incorporated and registered in country with company number [NUMBER] whose registered office is at [REGISTERED OFFICE ADDRESS] (Employer).

(2) [EMPLOYEE] of [ADDRESS] (Employee).

 

 

 

 

 

 

AGREED TERMS

1. TERMINATION DATE

Note: Termination date

The Employee's employment with the Employer [shall terminate OR terminated] on [DATE] (Termination Date). The Employee [has received OR will receive] their basic salary and other contractual benefits, including a payment in respect of [NUMBER] days' outstanding holiday, up to and including the Termination Date less tax and National Insurance contributions. [The Employee [has received OR will receive] a payment in lieu of notice of [NUMBER] [weeks' OR months'] notice pursuant to clause [NUMBER] in his employment contract, such sum to have tax and National Insurance contributions deducted in the usual way.]

 

2. PAYMENT

Note: Payment

2.1 The Employer will pay to the Employee £[AMOUNT] by way of compensation for the termination of their employment(Termination Payment). This amount consists of:

(a) £[AMOUNT] as a redundancy payment, including any statutory redundancy payment;

(b) £[AMOUNT] as an ex-gratia payment.

2.2 The Employer and the Employee believe that [the first £30,000 of] the Termination Payment will be tax free. [The remainder of the Termination Payment will be subject to deductions for income tax.]

2.3 The Employee shall indemnify the Employer on a continuing basis in respect of any income tax or employee national insurance contributions in respect of the Termination Payment (and any related interest, penalties, costs and expenses) which is incurred other than as a result of the Employer's default.

2.4 The Termination Payment will be made to the Employee within [14] days of the Termination Date or receipt by the Employer of a copy of this agreement signed by the Employee, including the certificate signed by the Employee's adviser as set out at Schedule 2, whichever is later. [The Termination Payment will be made to the Employee [before OR after] their P45 has been issued.]

2.5 The Employee warrants and represents to the Employer that there are no circumstances of which the Employee is aware or ought reasonably to be aware which would amount to a repudiatory breach of any express or implied term of their contract of employment which would entitle (or would have entitled) the Employer to terminate the Employee's employment without notice or payment in lieu of notice. The Termination Payment is conditional on this being so.

 

 

 

 

 

3. PENSION AND BENEFITS

Note: Pension

3.1 The Employer shall notify the trustees of its pension scheme that the Employee's employment [will terminate OR has terminated] and will request written confirmation of the Employee's accrued entitlement and the options available for dealing with their entitlement. [Subject to the rules of the pension scheme, the Employer will pay £[AMOUNT] into the scheme before the Termination Date in order to enhance the Employee's benefits.]

3.2 Subject to the rules of any relevant scheme, the Employer will continue to provide the Employee with [BENEFIT] until [DATE] or such time as any contract which shall provide the Employee with any form of income commences, whichever is earlier (subject to the rules of the relevant benefit schemes in force from time to time).

 

4. WAIVER

 

4.1 The terms of this agreement are offered by the Employer without any admission of liability and are in full and final settlement of all and any claims or rights of action that the Employee has or may have arising out of their employmentwith the Employer, or its termination, whether under common law, contract, statute or otherwise, whether such claims are, or could be, known to the parties or in their contemplation at the date of this agreement in any jurisdiction and including, but not limited to, the claims specified in Schedule 1 (each of which is intimated and waived) but excluding any claims by the Employee to enforce this agreement, any personal injury claims [which have not arisen as at the date of this agreement and any personal injury claims of which the Employee is not aware, and could not reasonably be aware at the date of this agreement] or any claims in relation to accrued pension entitlements.

4.2 The Employee acknowledges that the conditions relating to compromise agreements under section 147 of the Equality Act 2010, section 77(4A) of the Sex Discrimination Act 1975 (in relation to claims under that Act and the Equal Pay Act 1970), section 72(4A) of the Race Relations Act 1976, paragraph 2 of Schedule 3A to the Disability Discrimination Act 1995, paragraph 2(2) of Schedule 4 to the Employment Equality (Sexual Orientation) Regulations 2003, paragraph 2(2) of Schedule 4 to the Employment Equality (Religion or Belief) Regulations 2003, paragraph 2(2) of Schedule 5 to theEmployment Equality (Age) Regulations 2006, section 288(2B) of the Trade Union and Labour Relations (Consolidation) Act 1992, section 203(3) of the Employment Rights Act 1996, regulation 35(3) of the Working Time Regulations 1998, section 49(4) of the National Minimum Wage Act 1998, regulation 41(4) of the Transnational Information and Consultation etc. Regulations 1999, regulation 9 of the Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000, regulation 10 of the Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002, regulation 40(4) of the Information and Consultation of Employees Regulations 2004 and paragraph 13 of

the Schedule to the Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment) Regulations 2006 have been satisfied.

 

5. RETURN OF PROPERTY

Note: Return of property

5.1 The Employee warrants that before the Termination Date they [have returned OR will return] to the Employer in good condition all property belonging to the Employer or relating to the Employer or its business contacts in whatever format but including any car, company credit card, keys, security pass, identity badge, mobile telephone, pager, lap-top computer, books, documents, papers, computer disks, memory sticks and other media.

5.2 The Employee warrants that before the Termination Date they [have deleted OR will delete] irretrievably any information relating to the business or business contacts of the Employer that he has stored on any magnetic or optical disk or memory of any personal electronic devices, including computers of any description, and mobile phones.

 

6. CONFIDENTIALITY AND OTHER RESTRICTIONS

Note: Confidentiality and other restrictions

6.1 The Employee acknowledges and agrees that they will not divulge to any person or use for their own benefit information belonging to the Employer, including but not limited to information about the financial affairs and business affairs of the Employer or its business contacts and confirms and acknowledges that this duty is consistent with their duty under clause[s] [NUMBERS] of their employment contract dated [DATE] which will continue to apply after the Termination Date.

6.2 The Employee acknowledges and agrees that the restrictions contained in clause[s] [NUMBERS] of their employmentcontract dated [DATE] relating to restrictive covenants will continue to apply after the Termination Date.

6.3 The Employee and the Employer confirm that they have kept and agree to keep the existence and terms of this agreement confidential, except where disclosure is to HM Revenue & Customs, their professional advisers, members of their immediate family (provided that they agree to keep the information confidential) or is required by law.

6.4 The Employee shall not, and the Employer shall use reasonable endeavours to ensure that its employees and officers shall not, make any adverse or derogatory comment about each other or do anything which shall, or may, bring the Employer, its directors or employees, or the Employee into disrepute.

 

 

 

 

 

 

 

7. LEGAL ADVICE AND FEES

Note: Legal advice and fees

7.1 The Employee confirms that they have received independent advice as to the terms and effect of this agreement and in particular on its effect on their ability to pursue any complaint before an employment tribunal or court from [NAME] of [FIRM/ORGANISATION], who is a relevant independent adviser, and who shall sign the certificate set out at Schedule 2 to this agreement.

7.2 The Employer shall pay the reasonable legal fees (up to a maximum of £[AMOUNT] plus VAT) incurred by the Employee in obtaining advice on the termination of their employment and the terms of this agreement, such fees to be payable to their adviser on production of an invoice.

 

8. SUBJECT TO CONTRACT AND WITHOUT PREJUDICE

Note: Subject to contract and without prejudice

This agreement shall be deemed to be without prejudice and subject to contract until such time as it is signed by both parties and dated, when it shall be treated as an open document evidencing a binding agreement.

 

9. ENTIRE AGREEMENT

 

This agreement constitutes the entire understanding between the parties and supersedes any previous agreement between them relating to the Employee's employment and its termination.

 

10. GOVERNING LAW AND JURISDICTION

Note: Governing law and jurisdiction

10.1 This agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of England and Wales.

10.2 The parties irrevocably agree that the courts of England and Wales shall have [exclusive OR non-exclusive] jurisdiction to settle any dispute or claim that arises out of or in connection with this agreement or its subject matter or formation (including non-contractual disputes or claims).

This has been entered into on the date stated at the beginning of it.

 

 

SCHEDULE 1

CLAIMS

Note: List of claims

1. Claims:

(a) [for breach of contract or wrongful dismissal;]

(b) [for unfair dismissal and related claims, under sections 93 and 111 of the Employment Rights Act 1996;]

(c) [for a statutory redundancy payment, under section 163 of the Employment Rights Act 1996;]

(d) [in relation to an unauthorised deduction from wages or unauthorised payment, under section 23 of theEmployment Rights Act 1996;]

(e) [for an unlawful detriment under section 48 of the Employment Rights Act 1996;]

(f) [in relation to employment particulars and itemised pay statements, under section 11 of the Employment Rights Act 1996;]

(g) [in relation to guarantee payments, under section 34 of the Employment Rights Act 1996;]

(h) [in relation to suspension from work, under section 70 of the Employment Rights Act 1996;]

(i) [in relation to parental rights and flexible working, under sections 80 and 80H of the Employment Rights Act 1996;]

(j) [in relation to time off work, under sections 51, 54, 57, 57B, 60, 63 and 63C of the Employment Rights Act 1996;]

(k) [in relation to working time or holiday pay, under regulation 30 of the Working Time Regulations 1998;]

(l) [in relation to the national minimum wage, under sections 11, 18, 19D and 24 of the National Minimum Wage Act 1998;]

(m) [for equality of terms under sections 120 and 127 of the Equality Act 2010 [and/or under section 2 of the Equal Pay Act 1970];]

(n) [for pregnancy or maternity discrimination, direct or indirect discrimination, harassment or victimisation related to sex, marital or civil partnership status, pregnancy or maternity or gender reassignment under section 120 of the Equality Act 2010 [and/or direct or indirect discrimination, harassment or victimisation related to sex, marital or civil partnership status, gender reassignment, pregnancy or maternity under section 63 of the Sex Discrimination Act 1975];]

(o) [for direct or indirect discrimination, harassment or victimisation related to race under section 120 of the Equality Act 2010 [and/or direct or indirect discrimination, harassment or victimisation related to race, colour, race, nationality or ethnic or national origin, under section 54 of the Race Relations Act 1976];]

(p) [for direct or indirect discrimination, harassment or victimisation related to disability, discrimination arising from disability, or failure to make adjustments under section 120 of the Equality Act 2010 [and/or direct discrimination, harassment or victimisation related to disability, disability-related discrimination or failure to make adjustments under section 17A of the Disability Discrimination Act 1995];]

(q) [for breach of obligations under the Protection of Harassment Act 1997;]

(r) [for less favourable treatment on the grounds of part-time status, under regulation 8 of the Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000;]

(s) [for less favourable treatment on the grounds of fixed-term status, under regulation 7 of the Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002;]

(t) [for direct or indirect discrimination, harassment or victimisation related to religion or belief under section 120 of the Equality Act 2010 [and/or under regulation 28 of the Employment Equality (Religion or Belief) Regulations 2003];]

(u) [for direct or indirect discrimination, harassment or victimisation related to sexual orientation, under section 120 of the Equality Act 2010 [and/or under regulation 28 of the Employment Equality (Sexual Orientation) Regulations 2003];]

(v) [for direct or indirect discrimination, harassment or victimisation related to age, under section 120 of the Equality Act 2010 [and/or under regulation 36 of the Employment Equality (Age) Regulations 2006];]

(w) [in relation to the duty to consider working beyond retirement, under paragraphs 11 and 12 of Schedule 6 to theEmployment Equality (Age) Regulations 2006;]

(x) [under regulations 27 and 32 of the Transnational Information and Consultation etc. Regulations 1999;]

(y) [under regulations 29 and 33 of the Information and Consultation of Employees Regulations 2004;]

(z) [under regulations 45 and 51 of the Companies (Cross-Border Mergers) Regulations 2007;]

(aa) [under paragraphs 4 and 8 of the Schedule to the Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment) Regulations 2006;]

(ab) [under sections 68A, 87, 137, 145A, 145B, 146, 168, 168A, 169, 170, 174 and 192 of the Trade Union and Labour Relations (Consolidation) Act 1992;]

(ac) [in relation to the obligations to elect appropriate representatives or any entitlement to compensation, under the Transfer of Undertakings (Protection of Employment) Regulations 2006;]

(ad) [for failure to comply with obligations under the Human Rights Act 1998;]

(ae) [for failure to comply with obligations under the Data Protection Act 1998;]

(af) [in relation to existing personal injury claims, whether or not the Employee is aware of such claims;]

(ag) [in relation to the right to be accompanied under section 11 of the Employment Relations Act 1999;]

(ah) [in relation to refusal of employment, refusal of employment agency services and detriment under regulations 5, 6 and 9 of the Employment Relations Act 1999 (Blacklists) Regulations 2010;]

(ai) [in relation to the right to request time off for study or training under section 63I of the Employment Rights Act 1996; and]

(aj) [in relation to the right to equal treatment, access to collective facilities and amenities, access to employmentvacancies and the right not to be subjected to a detriment under regulations 5, 12, 13 and 17(2) of the Agency Workers Regulations 2010.]

(ak) [arising as a consequence of the United Kingdom's membership of the European Union.]

SCHEDULE 2

ADVISER'S CERTIFICATE

Note: Adviser's certificate

I, .................................................................. of ............................................................................, whose address is ..........................................................................................................................., am [a Solicitor of the Senior Courts of England and Wales who holds a current practising certificate] and confirm that I have given [EMPLOYEE] legal advice on the terms and effect of the agreement between my client, [EMPLOYEE], and [EMPLOYER] of today's date (the Agreement) and, in particular, its effect on his ability to pursue the claims specified in Schedule 1 of the Agreement.

I also confirm that there is now in force (and was in force at the time I gave the advice referred to above) a policy of insurance or an indemnity provided for members of a profession or professional body covering the risk of claim in respect of loss arising in consequence of the advice I have given [EMPLOYEE].

SIGNED.........................................................................................

DATE.............................................................................................

Signed by [NAME OF DIRECTOR] 
for and on behalf of [NAME OF EMPLOYER]

http://uk.practicallaw.com/presentation/images/common/blank.gif

....................

Director

 

http://uk.practicallaw.com/presentation/images/common/blank.gif

Signed by [NAME OF EMPLOYEE]

http://uk.practicallaw.com/presentation/images/common/blank.gif

....................

 

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Contributed by
Mereli Mc Inerney		  
Name of Firm Mereli Mc Inerney HR Employment Law
Principal Office Address 32 Derby Road Liverpool
Education / Certifications ll.b Law (Hons) MSC Global HR
Total Forms Contributed 1
Phone 07542193854
Website www.merelihremployment.co.uk
Email
 Outsourcing HR and Employment Law Experience the cost effectiveness of HR outsourcing. We could be your specialized outsourced HR Department today ? No more headaches in managing the people administration. Immediate access to specialist skills and services. ? Focus on your business and customers rather than on staff administration. ? Pay a fixed competitive monthly fee for all your business requirements including ? Employment law helpline exclusive to member company’s Gold members only ? HR and training administration ? Recruitment and selection including 1. Screening 2. Psychometric testing 3. Initial Interviews 4. Reference Checks ? Organisational design ? Job analysis, design and evaluation ? Team Building ? Coaching and mentoring ? Strategic planning for business and Human Resources ? HR strategy, enablement and implementation ? HR research and development including benchmarking and best practice ? Management Training and development ? Productivity improvement support ? Industrial Relations ? Assistance and representation throughout the entire Industrial Tribunal process Gold members only ? Expertise on disciplinary and grievance procedures ? Investigations ? Appeals ? Your staff if they have employment problems and are unhappy with their line managers etc contacts us. We then speak to the Company Director and try to resolve the issues before it spirals and ends up in staff absenteeism or a claim against the employer at an Industrial Tribunal

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Terms Of Use

Submissions to this site, including any legal or business forms, posts, responses to questions or other communications by contributors are not intended as and should not be construed as legal advice. You are strongly encouraged to consult competent legal council before engaging in any action based upon content contained on this site.

These downloadable forms are only for personal use. Retransmission, redistribution, or any other commercial use is prohibited. This includes reposting forms from this site to another site offering free legal or other document forms for download.

Please note that the donator may have included different usage terms regarding this form, and you agree to abide by these terms. It is highly recommended that you have a licensed attorney review any legal documents for which you are searching in order to make sure that your needs are being properly and completely satisfied.

Your use of this site constitutes your acceptance of our terms of use and your agreement to hold this site, its officers, employees and any contributors to this site harmless for any damage you might incur from your use of any submissions contained on this site. If you do not agree to the above terms, please do not proceed.

These forms are provided to assist business owners and others in understanding important points to consider in different transactions. They are offered with the understanding that no legal advice, accounting, or other professional service is being offered by these documents or on this website. Laws vary in the different states. Agreements acceptable in one state may not be enforced the same way under the laws of another state. Also, agreements should relate specifically to the particular facts of each situation. Therefore, it is important to consult legal counsel whenever utilizing these forms. The Forms are not a substitute for legal advice YourFreeLegalForms.com is not engaged in recommending or referring members on the site or making claims about the competence, character or qualifications of its participating members.
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Keywords: return of property, post employment confidentiality.
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