Compromise Agreement

[ziggzigg]

I'm on long term sick leave and have been offered a compromise agreement/payment. Without going into the details here :

 

1) There's only a short time-frame. I have to give a yay or nay by early July. This is a huge decision for me. If I get advice or try negotiating this will take time - I feel pressurised into making a fast decision. Just not sure if a two/three week decision deadline is usual/normal ?

 

2) I mentioned negotiating but I don't want to do it. I have googled the subject and there are loads of individuals/companies that say they deal with this type of situation . But how do I choose ? Everyone wants your fee and they are all brilliant ( plumber yellow pages scenario ! ). I've no idea where to start.

 

3) I've been offered one year's salary. I don't know if this is a good or bad deal. What else should I consider - pension, reference are bits I've thought of, but what else ?

 

Many Thanks

[ziggzigg]

Does anyone have any thoughts/experience of this kind of thing? Anything would be appreciated.

[JonCris]

Go on the Law Society website & search for a firm near you that practices in Employment Law & don't forget your employer is required to pay your legal consultation fees - it will or should say this in the agreement - & if it doesn't reject it

 

PS only a qualified practicing lawyer or suitably trained current union rep can advise you on a compromise agreement anyone else is not indemnified to pay damages should you sue them for negligence

Edited June 28, 2009 by JonCris

[ziggzigg]

Thanks JonCris

 

I've already (over this weekend) done that and bookmarked a list of local solicitors that 'have a banner' that includes employment law. What I need is a magic wand to know which are the good ones !! Ain't going to happen is it ....... I'm just going to have to pick one and hope !

 

My employer will pay a fee (legal cost) but it's conditional on the compromise agreement being signed. Atm it's here .... this is the agreement .... get it checked over. What I want/need is a specialist solicitor to talk me through what else could be expected, whether the ££ is good/bad/improvable etc, and then negotiate (if my employer will). So this or revised agreement may never be signed, in which case I'm stuck with the legal fee.

 

Maybe I'm wittering. I'd just feel more confident if I knew what deals other people had struck so I'd kind of have a benchmark. Plus if other people had agreed early retirement/pension deals .... anything really. I've been researching all weekend on the internet and there's just not much information on the kind of deals that have been made. Maybe because compromise agreements are usually confidential. But it makes it difficult for me to judge .....

[JonCris]

As much as they would like to they can't insist they'll only pay if you agree or more importantly your solicitor agrees with their offer. 1st that would mean any legal advice could be challenged as being biased as they are trying to tie the hands of the lawyer & 2nd it would leave you in an impossible position to either except or be saddled with bill of about £250

 

Contact them & tell them their proposal to pay your fee only if you agree is unacceptable & grossly unfair

[ziggzigg]

JonCris, I'm not sure.

 

Current situation - here is an agreement - we will pay £ for you to get independent legal advice - result you sign or don't (and if you don't we might or might not cover fee)

 

My preferred route - Use the employer's independent legal £ offer - go to solicitor, say is it good/bad? can you negotiate better/add-on's/early pension etc - have solicitor negotiate with employer (don't know if they will though ). It might all come to nothing ie they won't negotiate or offer sod all extra - in which case I don't accept.

 

Do you reckon they should still pay my legal fee ? I just think they're offering on the basis of what's on the table, not for a series of negotiations. I'll admit I know damn all about how this all works which is why I'm struggling.

[JonCris]

They can insist you seek legal advice in fact they have a legal duty to see you do otherwise the agreement is invalid - what they can't do is make payment of the fee a term of settlement - suggest you speak to a solicitor

 

In which area of the country do you live?

[ziggzigg]

Somerset

[elche]

ZZ

 

Joncris is correct in what he says. A comp agreement will be invalid unless you have taken ind legal advice.

 

If the sol is doing their job properly, they should advise you when you see the agreement. If you then walk out of that consultation w/o signing the agreement, then it is likely that the sol would breach SRA rules to insist on any payment.

 

I have done this kind of thing for a living for a while now and personally have seen clients come back more than once with c/a's and the only charge made by the partner or fee earner was the amount specified in the c/a and of course the fee note was always sent to the employer not the employee.

 

Thus, don't worry too much about the fee issue, take the c/a to a sol, and feel under no obligation to sign then and there if not happy.

 

Che

[JonCris]

I agree elche but the OP's acceptance should NOT be a condition of paying the legal fee

[Helford]

ZiggZagg,

 

I was selected for Redundancy earlier this year, given my profession this rather put me in a position as to what I refer to as 'at the the point of no return'. So I turned the tables and went down the route of a 'Compromise Agreement'. I discussed some loose terms with my then Employer and got a draft agreement emailed through. I then went to see my longstanding personal Solicitor and spoke with the employment law specialist (Given the economic situation he had already done a dozen or so such cases this year - this was only February!) The meeting was MOST productive and lots of revisions made in my favour - especially tax liability wise.

 

I would heartily recommend this route, if your departure from your employer is likely. My employer would only pay £250 plus VAT (Not much!) However, I ended up paying much the same as well, but the Solicitors advice and the revisions he made to the draft more than covered this.

 

Pick a local Solicitor that you wish to deal with NOT an anonymous internet name!

[andie_303]

my mum has just recently been through the same thing and despite a verbal agreement with her employer to pay up to £1000 solicitor fees when the compromise agreement came through the fee contribution had gone down to £250!!

 

She was also initially offered 2 months notice pay but was not required to work (her contract was only 1) as well as £X payment.

 

When her solicitor tried to get more her ex boss became a real hard ass and removed all the extras he had put in above what was the bare minimum in her contract - so she came out about £4k worse off and stuck with a solicitors bill of another £550 on top of that her employer paid!

[ziggzigg]

Ok, thanks all - you've given me a bit of confidence.

 

Plan is this - I need to speak to my employer next week anyway in response to their letter. I'll play it by ear, indicate I'm not against the idea in principle but I'm not overwhelmed by the offer put forward. If they are agreeable I'll take them up on the legal advice offer, have a solicitor review it, get some advice, and respond after that. Also ask them to extend the deadline because I'm not going to be rushed with this decision.

 

Does that sound ok ?

 

Just saw Andie's post - get them to confirm in writing they will cover £x of the legal fee whether I go through with the compromise agreement or not.

Edited June 28, 2009 by ziggzigg

[JonCris]

The standard charge is £250 which is more than enough to advise on a compromise agreement as it probably represents approx 1.1/2hrs work - this does NOT include any fees incurred for negotiating a better deal which are the liability of the client

Edited June 28, 2009 by JonCris

[Helford]

What trade or profession are you in ZiggZagg?

 

My Solicitor INSISTED that the reference that my Empolyer would give in future was agreed then and the wording incorporated in the Compromise Agreement. I ended up writing my own reference and my employer just agreed it. Many clauses protected my then Employer i.e. That I would not make disparaging remarks about them, disclose the real reason for leaving etc., my Solicitor INSISTED that these were reciprocated in my favour.

 

He also had the negotiated lump sum treated as redundancy/severence pay to reduce the tax liability

[ziggzigg]

The standard charge is £250 which is more than enough to advise on a compromise agreement as it probably represents approx 1.1/2hrs work - this does NOT include any fees incurred for negotiating a better deal which are the liability of the client

 

I'll have to risk it - pick up the excess if there is negotiation which doesn't produce an acceptable agreement. But I'll have to tell the solicitor up-front if it goes past ££, that's it. I can't afford to pick up a huge bill (especially if this doesn't work out).

[JonCris]

As Helfortd states the reference AND confidentiality are essential parts of the agreement - you don't bad mouth them & they promise not to bad mouth you

 

As an aside as a result of recent case law there is some thought that such agreements are no longer lawful if when applying for another job they force the concealment of the reasons why an employee has left their former employer - particularly if the reason not disclosed has some bearing or effect on the capacity to do the job

[ziggzigg]

What trade or profession are you in ZiggZagg?

 

No offence Helford but I'm not going to say - bit paranoid in case someone from employer recognises me.

 

Btw I'm a zigg not a zagg :)

[Helford]

'I'm a zigg not a zagg'

 

So you are!

 

Position on your profession understood. I only asked as the old issue of Restrictive Covenants arises if you are sales/customer facing orientated.

 

H