MG Legal Solicitors 
Longridge: 01772 783314 Garstang: 01995 602129 Lancaster: 01524 581306 Lytham: 01253 202452  
A person electronically signing an iPad, which is held by another person; our Settlement Agreement Employment Solicitors discuss settlement agreements, and how we can assist with advising on these, as well as the pros and cons.
Workplace disputes can make for a difficult environment for those involved and even for those not directly involved. When conflicts arise, one potential resolution path is through an employment tribunal claim. However, another avenue that is often considered is entering into a settlement agreement. This blog from our Settlement Agreement Employment Solicitors will explore why entering a settlement agreement can be advantageous over pursuing an employment tribunal claim, and will also discuss the drawbacks associated with settlement agreements. 

Contact our Settlement Agreement Employment Solicitors 

A yellow pen resting on a blue background; our Settlement Agreement Employment Solicitors can be contacted by completing the form here.

Advantages of Settlement Agreements 

Certainty and Control 

Settlement agreements provide a level of certainty that an employment tribunal cannot. Both parties have control over the outcome, including the terms of the settlement and the compensation amount. This avoids the unpredictability of a tribunal decision. 


Settlement agreements often include confidentiality clauses, ensuring that the details of the agreement and the circumstances leading up to it remain private. This can be particularly beneficial for preserving an employee’s reputation and future employment prospects, as well as protecting the employer’s business reputation. 


Pursuing a claim through an employment tribunal can be expensive, with legal fees accumulating over time. A settlement agreement can be a more cost-effective solution, as it typically resolves disputes more quickly and with less expense. Often, the employer will cover some or all of the costs, leaving the employee with a small or no legal fees to pay. 


Employment tribunal claims can take a significant amount of time to resolve, sometimes years. Settlement agreements, on the other hand, can be concluded relatively quickly, allowing both parties to move on sooner. When you instruct the solicitors at MG Legal for your settlement agreement, we can offer advice, and get the settlement agreement concluded, within a couple of days of you first making contact with our offices. 

Emotional Well-Being 

The process of going through an employment tribunal can be stressful and emotionally draining for all involved. A settlement agreement can minimise this stress by resolving the matter in a more amicable and less confrontational manner. It can also help to reduce any stress involved with the uncertainty of an employment tribunal. 

Drawbacks of Settlement Agreements 

Waiving Rights 

By signing a settlement agreement, employees typically waive their right to make any future claims related to their employment or its termination. It’s crucial to understand exactly which rights are being waived, as this can sometimes include claims that are not immediately apparent. When you instruct a solicitor that specialises in settlement agreements, they will make sure that all potential claims are discussed, prior to you signing the agreement. 

Pressure to Settle 

Employees might feel pressured to accept a settlement agreement, especially if they are concerned about the cost or emotional toll of pursuing a tribunal claim. This can sometimes lead to accepting terms that are less favourable- this can, however, be circumvented, by instructing a solicitors specialising in settlement agreements, to advise you. 

Financial Considerations 

While a settlement agreement can offer financial compensation, determining the appropriate amount can be complex. There’s always the possibility that an employee might have received more through a tribunal claim, particularly if the case against the employer was strong. However, by choosing the right solicitor to assist with your settlement agreement, there is minimal risk that this would occur. 

No Formal Admission of Guilt 

Settlement agreements typically do not require the employer to admit any wrongdoing. For some employees, the lack of formal recognition of the issues they faced can be unsatisfying and may feel like a denial of justice, especially if the workplace issues they faced were severe. 
Entering into a settlement agreement can offer a pragmatic and expedient resolution to workplace disputes, providing benefits such as certainty, confidentiality, cost and time savings, and a potentially less stressful resolution process. However, it’s important to weigh these advantages against the drawbacks, including the waiver of rights, the potential pressure to settle, financial uncertainties, the lack of a formal admission of guilt by the employer, and potential impacts on future employment. 
Ultimately, whether a settlement agreement is the right choice will depend on the specific circumstances of the dispute and the priorities of the parties involved. Consulting with a Settlement Agreement Employment Solicitor to understand the implications and negotiate favourable terms is essential in making an informed decision. At MG Legal, we will walk you through the terms of your settlement agreement, advise you if the terms are favourable, and then, only when you are happy with the offer made, and protected by the provisions of the agreement, we will proceed to have the agreement signed by all the parties, and the matter will be concluded. We can usually have a settlement agreement concluded, within a couple of working days. 
To discuss entering into a settlement agreement, contact our Settlement Agreement Employment Solicitors on 01772 783314 or email 
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