Settlement Agreements, Confidentiality & Restrictive Covenants
Legal services for employers
Why Taylor Law?
A settlement agreement is a legally binding document signed by both employer and employee agreeing to settle any claims the employee may have in respect of their employment or the termination of their employment.
Terms containing confidentiality provisions and restrictive covenants are used both in settlement agreements and elsewhere, such as in employment contracts, to protect the employer and their business interests.
At Taylor Law we act for employers in drafting settlement agreements, confidential and restrictive covenants documentation.
The most common use of a settlement agreement is to end a period of employment. In return for a payment, an employee will waive their right to make any claim against you as their employer.
Entering into a settlement agreement can be advantageous for employers. It is usually a far quicker way of dealing with an issue than, for example, waiting for a notice period to expire or going through a dispute resolution process.
The agreement will deal fully with all outstanding issues, such as payment of in lieu of holiday or bonuses. Other matters, such as the provision of a reference, can also be included.
When drafting a settlement agreement, we will include require the employee to agree to confidentiality in respect of the agreement itself, the employment and your business.
At Taylor Law, we are experienced in both drafting and advising on settlement agreements for a wide range of employers. We understand what can reasonably be included and will ensure that your rights and interests are adequately protected.
Confidentiality and restrictive covenants
It is important for both employees and employers to understand their rights in relation to restrictive covenants. Whilst for employers it is important to have well drafted contracts for your employees and understand the methods of enforcement available.
There is a risk of harm to a business where the information and practices that it uses are disclosed to a competitor. For this reason, confidentiality clauses and restrictive covenants are used to prevent employees and ex-employees from revealing any information about an organisation.
Data which you should protect include customer lists, marketing and business plans, manufacturing processes and management information.
Confidentiality clauses and restrictive covenants need to be included in employment contracts as well as settlement agreements, to protect your business throughout an employee’s time with you.
Following the ending of employment, you will not only want to protect your sensitive information but will also want to prevent the employee from actions such as persuading clients or customers to go with them, setting up a rival business nearby or working for a competitor.
Post-termination restrictive covenants can prevent this from happening, but it is essential that they are well-drafted as the court will not enforce any which are too wide, which could leave you unprotected.
Only through suitable contract drafting are post termination restrictions likely to be effective, thus it is important for employers to get contracts drafted properly from the start.
Factors to be considered include the geographical area of the restriction, the activities that are restricted and the type of interest being protected.
Post termination restrictions normally fall into four categories:
- Restriction from solicitation
- Restriction from competition
- Restriction from dealing
- Restriction from poaching
Visit our frequently asked questions for more information.
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%.
At Taylor Law our employment team have in-depth experience of drawing up robust settlement agreements with effective confidentiality clauses and restrictive covenants to ensure that your rights and interests as an employer or an individual are adequately protected.
For an initial discussion, ring us on 0113 532 8100 (Leeds), 01642 221 108 (Middlesbrough) or 0203 780 7646 (London) or fill in our Contact Form.
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