What happens if you don’t sign a settlement agreement?

If you decide not to sign a settlement agreement then you revert to the status quo
immediately prior to the offer. It’s wise to seek legal advice from a UK settlement agreement solicitor to know where you stand.


In some cases individuals are offered settlement agreements alongside a process which is being put in place to address concerns with their employment. This could be for example a process to address alleged performance concerns or a process to address disciplinary misconduct.


In those cases if an individual decides not to sign then the employer may decide to revert to that process and continue it to its conclusions. This could mean that an employee is dismissed if they choose not to sign their agreement.


In other cases employees are offered a settlement agreement as an alternative to continuing with a redundancy process. In that case what will happen if you don’t sign a second agreement is that the employer will revert to the redundancy process and pay redundancy entitlement accordingly.


Make sure that you take careful advice from your legal adviser because in many cases contractual payments or a redundancy payment will ultimately be less than the sums of money payable to you under your settlement agreement. That said if you are deciding to challenge the fairness of a redundancy you may have a claim for unfair dismissal which can result in damages payable of up to 12 months salary.


If you don’t sign a settlement agreement then the terms within it do not become legally binding. A settlement agreement only becomes legally binding whether this signed by both parties namely the employee and employer as well as the legal adviser who has provided advice to the individual about the terms of the agreement.