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Terminating Employment and Settlement Agreements

Faced with being in the unfortunate position of having to terminate the employment of an employee is difficult but sometimes unavoidable. To ensure your process is fair and legally compliant is important.  Taylor Law employment solicitors can help you to protect your business ensuring also your employees are treated fairly.

Things to Consider when dismissing an Employee 

Getting a dismissal wrong can cost time, money and damage your reputation. It’s important to get legal advice at an early stage.

When thinking about dismissing an employee, you need to be clear and concise and take into consideration how long they have worked for you.

Employees who have worked for you less than two years do not have the right to bring unfair dismissal claims

When the employee has worked for you for two years or more, you can only dismiss them fairly for the following reasons:

  • Conduct (inappropriate behaviour)
  • Capability (inability to do their job)
  • Redundancy
  • Statutory Illegality
  • Some other substantial reason (SOSR).  

You should also consider if there are any grounds for an employee to bring other types of claims against you. These could include breach of contract or discrimination claims

How to Avoid Unfair Or Wrongful Dismissal Claims

Taylor Law employment lawyers advise businesses of all sizes about both individual and collective dismissals, reducing the risk of expensive and time-consuming litigation.

Getting legal advice as soon as possible if you feel you need to dismiss an employee is essential as the procedure adopted before dismissal is very important. 

You can help prevent unfair dismissal claims by simply following the company’s policies and procedures.  You must ensure that all disciplinary hearings are conducted fairly, and that the employee is given the right to put their side of the story accompanied by a work colleague or trade union official.

If the employee is dismissed, he should be given the right to appeal to someone not previously involved in the dismissal, if at all possible. An instant dismissal with no procedural safeguards, will often lead to an unfair dismissal claim.

Your business is in safe hands with Taylor Law. 

No matter how big your or small your business is, we can help you. Our employment solicitors understand that no two dismissals are the same, so we’ll give you individual tailored advice.

Our qualified lawyers are available to help no matter where you are.  We will always give you transparent fees and keep you updated.


What Is A Settlement Agreement?

A settlement agreement is a formal written and legally binding contract between an employee and employer, where an employee accepts financial compensation in return for agreeing not to bring any claims against you.  It is often referred to as a ‘severance’ or ‘redundancy agreement’ and was previously known a ‘compromise agreement’. 

You can use a settlement agreement if you do not want to go through a full dismissal process, or you want to avoid possible risks for dismissing someone. 

 For a settlement to be legally binding:-

  • an employee must receive independent legal advice (the advisor must be covered by professional indemnity insurance)
  • The agreement must be in writing and signed by the employee
  • It must relate to “particular proceeding”
  • The agreement must state that the legal conditions regulating the settlement agreements are satisfied.

ACAS have issued a statutory Code of Practice on Settlement Agreements, is a useful link setting out how settlement agreements should be conducted and provides best practice advice on how pre-termination negotiations should be conducted.  The code is not binding, but employers would need to justify why they deemed it not necessary to adhere to it.

How can we help

At Taylor Law we are happy to provide both employers and employees with the immediate advice you need and guide you through the process.  Our team can help you write an agreement, check and existing one or negotiate any agreement terms.

Our qualified lawyers are available to help no matter where you are.  We will always give you transparent fees and keep you updated.

Our Employment Fees and Costs

Our employment solicitors are:

Scott Taylor (Solicitor with at least 8 years’ experience)

Ben Tighe (Solicitor with at least 8 years’ experience)

Max Hornigold (Solicitor)

Angela Giannotti (Solicitor – London)

Chris Bennett (Junior Executive – London)

 Our hourly charges are as follows:

 Private (Leeds and Middlesbrough) :

Partners/Solicitors with at least 8 years’ experience – 265.00

Solicitors with at least 4 years’ experience – 230.00

Solicitors, Legal Executives, Senior Executives – 200.00

Trainee Solicitors – 140.00

Junior Executives/Assistants – 140.00

Private (London) :

Partners/Solicitors with at least 8 years’ experience – 450.00

Solicitors with at least 4 years’ experience  – 325.00

Solicitors, Legal Executives, Senior Executives  – 250.00

Trainee Solicitors – 150.00

Junior Executives/Assistants – 150.00

Lesser complexity case

This would tend to be a case where unfair dismissal is the sole claim and the matter is limited to a one-day hearing.
It would be in the region of £15000-£18,000 plus VAT and disbursements (if we instruct counsel).

Medium complexity case

This would be a case where there are additional claims to unfair dismissal, such as discrimination. This would also apply where the case for unfair dismissal requires a Preliminary Hearing or where the case is listed for a Final Hearing of two or three days’ duration.

This would be in the region of £20,500- £23000 plus VAT, plus counsel fees of approximately  £1,500 for the first day of the Final Hearing and £1,000 for the refreshers for the second and subsequent days of the Final Hearing.  .

Higher complexity case

This would be a case where the unfair dismissal claim involves multiple discrimination complaints or complex matters such as whistleblowing/making of protected disclosures and where the case is listed for a Final Hearing of two or more days’ duration.

From £20,000 to £25000 plus VAT, plus counsel fees of £1,500 for the first day of the Final Hearing and £1,000 for the second and subsequent days of the Final Hearing.

The following factors can have an impact on the complexity of a case:

  • Defending claims that are brought by litigants in person
  • Complex preliminary issues such as whether the claimant is disabled (if this is not agreed by the parties)
  • The number of witnesses and documents
  • If it is an automatic unfair dismissal claim.  For example if the reason for dismissal is because of a protected disclosure or an employee’s pregnancy or maternity leave

The fees set out above cover all of the work in relation to the following key stages of a claim:

  • Taking initial instructions, reviewing the papers and advising on merits and likely compensation
  • Entering into pre-claim conciliation
  • Preparing a claim or response
  • Reviewing and advising on a claim or response from other party
  • Exploring settlement and negotiating settlement throughout the process
  • Preparing a schedule of loss
  • Preparing for and attending a Preliminary Hearing
  • Exchanging documents with the other party and agreeing a bundle of documents
  • Taking witness statements, drafting statements, and agreeing their content with witnesses
  • Preparing bundle of documents
  • Reviewing and advising on the other party’s witness statements
  • Agreeing a list of issues, a chronology and/or cast list
  • Preparation for the Final Hearing or instructions to Counsel

The stages are not fixed and guaranteed, and we will adjust our costs accordingly when some stages are not required.

How long will my matter take?

The time that it takes from taking your initial instructions to the final resolution of your matter depends largely on the stage at which your case is resolved. If a settlement is reached during pre-claim conciliation, your case is likely to take 2-4 weeks. If your claim proceeds to a Final Hearing, your case is likely to take 9-18 months. This is just an estimate and we will of course be able to give you a more accurate timescale once we have more information and as the matter progresses.


Disbursements are costs related to your matter that are payable to third parties, such as court fees. We handle the payment of the disbursements on your behalf. Disbursements incur a VAT charge of 20%.

Call us free on 0330 0539147  or email and we will be happy to help.

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