Independent legal advice from specialist employment solicitors. We’ll explain your options and help you decide whether to sign, negotiate or walk away.
Took the stress out of the situation. Polite, responsive, and a safe pair of hands. Overall, very happy with the service and outcome.
An unfair dismissal settlement agreement is used to resolve a dispute arising from the termination of employment. The agreement usually provides compensation in exchange for the employee agreeing not to pursue claims in the Employment Tribunal.
Most settlement agreements are offered before a tribunal claim is issued. Others are offered after proceedings have started, where both parties wish to avoid the time, cost and uncertainty of litigation.
If you have been offered a settlement agreement following dismissal, it is important to understand whether the offer properly reflects the value of your claim before signing.
“Very helpful to me during a complex potential redundancy situation. Highly recommended, invaluable advice, and very prompt to respond.”
“Very prompt and helpful service with completing my matter. Discussed all the details and were able to advise. Very professional helpful and understanding. Thank you so much”
“Fantastic help and support which lead to a very positive outcome. Highly recommended”
“My experience with the legal team was very quick and efficient with no hassle”
If you have been dismissed and offered a settlement agreement, it is important to understand whether the offer properly reflects your position before signing. Sometimes the offer is fair, and the best advice is to accept it. Sometimes there is scope to negotiate a better outcome.
Our specialist employment solicitors can review your agreement, explain your options in plain English and give you an honest view on what happens next.
Compensation in an unfair dismissal claim typically consists of two elements.
The basic award is calculated using a formula similar to statutory redundancy pay. It takes into account your age, length of service and weekly pay.
The compensatory award is intended to compensate you for financial losses arising from your dismissal.
This may include:
The value of a claim depends heavily on how long it takes you to secure alternative employment. Employees who find a new role quickly will generally recover less than those who remain out of work for longer.
Because every case is different, it is important to assess the value of any potential claim before accepting a settlement offer.
An unfair dismissal settlement agreement can be negotiated. However, not every settlement agreement should be negotiated.
One of the biggest misconceptions about settlement agreements is that every offer is unfair. In reality, many agreements are reasonable from the outset. Our role is to determine whether there is a genuine opportunity to improve your position.
Where we believe there is value in negotiating, we can seek improvements to:
Where we believe the offer is already fair, we will tell you that too.
Both a COT3 agreement and a settlement agreement can be used to resolve an unfair dismissal dispute.
The key difference is how they are reached.
| Settlement Agreement | COT3 Agreement |
| Usually negotiated directly between the employer and the employee | Usually reached through ACAS |
| Independent legal advice required | Independent legal advice is optional |
| Often used before tribunal proceedings | Commonly used during ACAS conciliation |
| More flexibility over terms | Usually simpler and shorter |
Although legal advice is not required for a COT3 agreement, it is still advisable to understand exactly which rights you are giving up before agreeing to any settlement.
Yes. Independent legal advice is a legal requirement before a settlement agreement can become binding.
Yes, you can refuse a settlement agreement. Settlement agreements are voluntary. If you choose not to sign, your employer may continue with a redundancy, disciplinary or capability process or defend any tribunal claim.
In most cases, unfair dismissal claims must be started within three months, less one day of the termination of employment.
In most cases, employers contribute towards the cost of legal advice as part of the settlement agreement. Our fees will never exceed the contribution of your employer unless you ask us to negotiate better terms on your behalf and approve the additional costs beforehand.
Potentially, you can negotiate a better settlement. The answer depends on the strength of your claims, the circumstances of your dismissal and the terms already offered.
I’ve been advising employees on settlement agreements for over two decades. In that time, employment law has shifted considerably. However, what’s coming in January 2027 is, in my view,
A settlement agreement payment (lump sum) under £30,000 is not taxable. Payments under £30,000 are not taxable providing they do not include other contractual payments. A settlement agreement payment
What does a Solicitor do with a Settlement Agreement? When your employer offers you a settlement agreement, you are legally required to take independent advice before signing. But what does that advice
© 2026 Settlement Agreement Advice Is A Trading Name Of DPH Legal And Is Authorised And Regulated By The Solicitors Regulation Authority
SRA Number: 554878.
All Solicitors Are Long-Standing Members Of The Employment Lawyers Association.
Registered In England & Wales With Company Number: 14411202
Registered Office: 175 Wokingham Road, Reading, RG6 3EU
