Settlement Agreement Time period

[landlor]

Hello Friends,

 

My employer (a large investment bank) made me redundant in just seven months and offered the settlement agreement as usual. I was handed the agreement at the end of day on 01-May and asked to sign and send it back to them by 07-May, after receiving advise from a qualified solicitor on the settlement agreement. The employer gave me three months redundancy.

 

Is it okay for them to give so little time. FYI, 02,03 and 04 May were bank holiday. Thus I could start finding a solicitor only on 05-May and post the agreement on 06-May so that the it reaches the employer on 07-May.

 

I was given so less time to fully appreciate the agreement and as I retro-inspect today, I realise that I had worked overtime everyday for an extra hour, several midnight support and weekend support.

 

Please help me to understand what my legal position is? Can an employer give so less time to sign the agreement? Should my solicitor not have won more time for me from the employer? I believe my solicitor failed me as well. I am aware that ACAS recommends minimum ten calendar days should be given to the employee. The solicitor could have used this practice guideline to get more time from the employer. However he did not do any thing of this sort and rather advised to sign and send as soon as possible. He was paid 500.00 pounds for this as service fee.

 

Does it not count as poor service by the solicitor?

[honeybee13]

Hello again. I'm sorry to hear you're having problems again.

 

Did you ask us about this in May when it all happened?

 

And did your ex-employer offer to pay for legal advice for you? I'm not a legal expert, but I thought that was what they were meant to do.

 

HB

[landlor]

Hey Honeebee, Thanks for the reply.

 

Yes, the solicitor fee was paid and recommended for by the employer. Its only now that I am realising that I have done so much extra work from the employer and that I could have had this realisation at the time of signing agreement had I been given a reasonable amount of time.

 

Can someone tell me weather the employer has been legally wrong, as per common law. Can the employer put such deadlines in the settlement agreement?

 

Was the service given by solicitor not of poor quality?

[steampowered]

There is a legal requirement is that you must receive advice as to the effect of the settlement agreement in order for it to be enforceable (basically just telling you that signing waives the right to bring a claim in future). The £500 fee would have covered that bit only. This is the only part normally paid by employers.

 

The £500 fee would not have covered advice about what you might be able to claim for, or for negotiation of the terms of the agreement. If you wanted the solicitor to advise on those things that would have cost extra and probably would not have been covered by your employer. This should have been set out in an engagement letter you should have received from the solicitor.

 

It is unreasonable for the bank to impose such a tight timeline, but not illegal. If you wanted more time I think you needed to ask.

 

Three months is a pretty generous payment. Normally you have to work for an employer for 2 years to qualify for a redundancy payment - normally the only thing you would get after 7 months is 1 week's notice pay. Unless of course there was a longer notice period in your contract.

[landlor]

So even if that is the only bit that the solicitor was supposed to do, does it mean that he does not need to tell me that the settlement agreement needs to be given ten days, as per ACAS, and that is for the employee to fully appreciate how those terms affect him. The engagement letter says that he advised me on terms of the Settlement Agreement specially related to unfair dismissal etc.

 

There cannot be a seperate line in the engagement letter to say that he will advise me on time that an employee will be given. If that is to be the case, then the employee can find that himself. What is the use of solicitor then? Only to read out?

 

I did ask the employer for more time but they did not agree to my request.

[Emmzzi]

That's what I got from my S.A> lawyer.. I decided to pay extra for proper advice but then I had a few more years service. On a very short contract - generally better to just take the cash, ensure you have good leaver status, and draft your own reference to be agreed as the only one to be sent out.

 

Also be aware - ACAS recommends =/= legal requirement. If you saw the solicitor - job done!

[ericsbrother]

How many people were made redundant at the time? that will determine the consultation period prior to the offer for severance.. The idea of the lawyer reading the settlemnt contract is to make sure it is legal and you understand it. In practical terms what do you want? if you were there for only 7 months then you wouldnt have any redundancy entitlement and little in the way of notice period either so 3 months pay for waiving your rights to diddly squat isnt so bad. If you hadnt been bade redundant would you have made a claim for overtime and if so, why hadnt you done this on a regular basis from month 1.

You can ask the employer to tear up the agreement and hand back the money then claim for your overtime but dont be surprised if they point to a part in your contract saying that some overtime is inevitable etc and you then get nowt.

[altobelli]

I think you would have needed to raise the matter at the time with the bank in order to have redress from them. Problem is that the agreement is signed now and the three months redundancy, although not unusual in banking, is more than the statutory requirement. The time you were given was unreasonable, but the bank would probably have given you an extension if you had requested it in May, as banks generally (but not always) don't like to go against ACAS guidelines, regardless of whether or not they are legally enforceable, but I think unfortunately its too late now.

 

 

In terms of the solicitor, it would have been better if they had made you aware of the ACAS guidelines, so you may want to raise the matter with them. But before doing so, you need to think what you would have done had you known and would you have received more. How much do you think you have missed out on by not knowing about the guidelines or having more time in May?

 

 

In general, its better in banking to take independent legal advice on settlement agreements rather than go with the solicitor recommended by the bank, you tend to get a better settlement (appreciate that you did take independent advice though).

[landlor]

Hey All, I did ask my employer for more time but they did not give and said that after 07-May, I will get only statutory severance. Giving less than ten days to an employee is cited as case of "Unambigous Impropriety" in ACAS guidelines and that the Employment Tribunal can render the contract as unenforceable.

 

As far the question of why I did not claim for overtime earlier: I did not because permanent employees are expected to work beyond contracted hours to keep the bank running and are rewarded in terms of better job security and bonus. None of these two happened. My job was reduced as the bank off-shored the job for their benefit. Clearly they did't care for the blot on my career. If the stint lasted so short, then I believe I should be compensated for all the overtime work. No? After joining, I was asked to stay back for an extra hour every day to cover business. Apart from this, several night and weekend support as well. Moreover even as per contract, I can be asked to stay back to fix one-off issue that may come , but in this case, the bank asked me stay back for an hour extra Everyday Single day. That must be paid for, apart from the three months redundancy, which I see as compensation for damage to my career.

 

My appraisal rating in Dec-2014 was as Consistently Strong. The redundancy was not a mass redundancy.

[Emmzzi]

"The employee needs to be given

reasonable time to consider an offer

of a settlement agreement. What is

reasonable will depend on the

circumstances of each case,

including what both parties might

agree is a reasonable time.

As a general rule, a minimum period

of 10 calendar days should be

allowed to consider the proposed

formal written terms of a settlement

agreement and to receive

independent advice, unless the

parties agree otherwise."

 

 

 

Did you fail to agree a shorter timeline and more importantly CAN YOU PROVE IT

[becky2585]

The difficulty with the ten-day "rule" is that it's only a guideline, not a statutorily enforceable requirement. It could, in theory and on basic contractual principles render the Agreement void, to the extent that you had not validly waived your legal rights and could therefore present a complaint to an employment tribunal.

 

The difficulty in the situation is that you have no remedy and no right to claim, so in my view the 10 day rule is a moot point. Ultimately you either accept their offer of an enhanced payment within the limited timescale, or you decline based on your principles and go away with far less.

 

Personally I'd view the enhanced payment as a very generous gesture and view the rest of the complaints here as a massive red herring.

[steampowered]

You had no statutory entitlement to redundancy pay. That only applies if you have more than 2 years' continuous service. After 7 months the only legal entitlement you would have had is one week's notice (or the notice period stated in your employment contract, if longer). And the bank could have made you work that notice period.

 

Given your length of service your settlement was very generous. Most people who are dismissed after 7 months get one week's notice pay and nothing more.

 

Failure to comply with the ACAS guidelines does not render an employment contract void and is not legally actionable. In some situations (like unfair dismissal) you can get a 25% uplift if an employer does not follow the guidelines when conducting the dismissal, but that doesn't apply here (and in any event I guess would be 25% on what you were legally entitled to - being one week's notice).

 

It sounds like you worked very hard and did not deserve to be dismissed, but unfortunately you can't go back to claim overtime now that you signed the settlement agreement. I doubt the overtime would have added up to 3 months' pay anyway.

[ericsbrother]

Another thing, it is not redundancy, it is SEVERANCE. You are not due any redundancy pay but have been offered severance in exchange for exercising certain rights, which you dont actually have or are severely limited in any financial or legal sense. The deal you were given is the best you could possibly get so stop thinking about what might have been because it wouldnt have happened anyway by your own admission.

[landlor]

Well, I will answer one by one.

 

@Emzzi: Weather I can prove that shorter time was by agreement or not? I think it will be for employer to prove that such a short time was agreed, not for me. The SA has been prepared by them and the deadline does not say that it has been agreed.

 

Everyone seems to be focusing on that fact that I got three months severance for seven months of service, as though I had a windfall. No one seems to appreciate that such a short stint is a blot on my career. That too only for their benefit and there is a consistent loss for me. Say when I went for a mortgage, I don't get because my employment history is not great. Had it been a contracting stint, it would not been an issue and also I would have got paid for all the extra hours of work.

 

When I had informed my director about my hours of work, he said that Perm. employees are expected to do this. So while they justify my extra time as normal, nothing has been done by them when they themselves could not keep me in job like perm. employee.

 

Not only is this an example of "Improper Behavior", it is a case of "Unambigous Impropriety" by the employer. The employer put pressure on me to sign the SA by telling that if not, they will withdraw the offer.

 

Even if I cannot prove financial loss, it definitely was a stressful for me as I had to travel abroad on 06-May and I mentioned this to the employer. But the employer did not change their position. And the question is not weather I could have got more or not, it is a question that I was deprived of the opportunity and the employer is clearly on wrong side. Pressing me to sign the agreement in less than TEN days is quite clearly mentioned as a case of "Unambigous Impropriety" and that the terms of SA can be rendered unenforceable and that the employment tribunal can levy Penalty to the employer, given it their standard practice, as per their own admission on email. Secondly, for over four months I was discharging duties at one level above me as the manager of the team made an internal move. So it had become very hectic for me.

 

Also one can always claim overtime later. Does it need to be within a certain time limit?

[Emmzzi]

Well, I will answer one by one.

 

@Emzzi: Weather I can prove that shorter time was by agreement or not? I think it will be for employer to prove that such a short time was agreed, not for me. The SA has been prepared by them and the deadline does not say that it has been agreed.

 

Court works the other way round. It's for you to prove. Stick it on your CV as an interim role, and move on with your life.

[landlor]

I don't think this will be an issue. There can be proof of something which happened. but if something did not happen, the where will theproof exist.

 

If I say that there was no such agreement, then the court is not a fool to say that prove unless the employer opposes it and then it will be for the employer to prove that.

 

The SA prepared by employer and so it means employer gave the time line? No confusion.

[Emmzzi]

I think you had best ask a lawyer; you seem to disagree with most people commenting here. However, the court will not change the standard of proof required simply because you think it unfair.

 

Let us know how you get on.

[steampowered]

I don't see anything you could have claimed for here:

- The fact that you feel the short stint is a blot on your career is unfortunate. But you don't get any compensation for that. That's just life.

- You would only be entitled to overtime if stated in your contract. I imagine your contract did not provide for this. None of the investment bankers working 80 hours a week get overtime.

- You cannot get compensation for working a harder job than you expected. You'd only get extra money if a salary increase was agreed at the time.

- You cannot claim compensation for failure to follow the ACAS guidelines.

 

The basic legal position is that an employer can dismiss anyone with less than 2 years' service for any reason, as long as that reason is not illegal such as race/gender discrimination, and the only thing they have to pay is one week's notice. That is just how it is.

 

The technical legal position on the ACAS guidelines is that, if you are awarded compensation for a type of claim listed in Schedule 2 of the Trade Union and Labour Relations Act 1992, and the employer unreasonably failed to follow the ACAS code in relation to that matter, you can ask the Tribunal to bump up your compensation by up to 25%. This covers proceedings for things like unlawful compensation and unfair dismissal. The problem here is that you do not have any sort of claim which falls under Schedule 2 - as you have less than 2 years service you simply do not qualify to make an unfair dismissal claim. You can read the law for yourself here http://www.legislation.gov.uk/ukpga/1992/52/section/207A and here http://www.legislation.gov.uk/ukpga/1992/52/schedule/A2. It is impossible to bring a separate self-standing claim for breach of the ACAS code.

[landlor]

The ACAS stipulation of ten days is to say that less than ten days is sufficient to call it unfair. So the entire contract itself can be said to have an unfair term in it and unfair term contract law will be applicable.

[Emmzzi]

go and get a no win no fee lawyer if you are so certain. There s no point just keeping repeating that you disagree with us!

[steampowered]

The ACAS stipulation of ten days is to say that less than ten days is sufficient to call it unfair. So the entire contract itself can be said to have an unfair term in it and unfair term contract law will be applicable.

 

This is simply not true. Compliance with the ACAS guidelines is not mandatory and is not legally enforceable. Compliance with the ACAS guidelines is not a term of your contract and a settlement agreement. Furthermore, settlement agreements are not a consumer contract within the meaning of unfair terms legislation, and so unfair terms legislation does not apply.

 

I'm afraid you are on to a hiding to nothing with this. If you had a chance I would tell you. I'd suggest getting yourself down to a law centre or CAB if you are not convinced.

[ericsbrother]

Ok, go down that route and swap your 3 months pay for a weeks pay and get a poorer reference to boot. With the severance deal they have a confidentialty agreement so any reference will be pretty straightforward but positive. Swap this deal for (maybe) some overtime money and I would bet on the reference being less positive.

[landlor]

Ok, go down that route and swap your 3 months pay for a weeks pay and get a poorer reference to boot. With the severance deal they have a confidentialty agreement so any reference will be pretty straightforward but positive. Swap this deal for (maybe) some overtime money and I would bet on the reference being less positive.

 

Just wondering, how often is reference from previous employer used. This is the first SA which has a reference attached to it. I have changed so many employers and all that a new one wants is to confirm dates of employment.

 

Also about unfair contract law, this is not necessarily limited to Consumer Contract. It is applicable to all contracts that if it had unfair term, then it can be challenged a=even after acceptance. I had a similar situation with Landlord, where rental contract had a clause that I will return his property after a professional cleaning, where as I myself never got after professional cleaning. The DPS clearly refused Landlords point that that it is mentioned in the Rental Contract and hence I was legally oblisged to get professional cleaning done.

 

And why would unfairness and unreasonablness be limited to consumer contracts? They are applicable everywhere. The courts will never allow themselves to be used to support something unfair. Will they?

And how many will accept that one and half day is a fair amount of time for signing a SA, running into 18 pages.

 

I have raised this with legal ombudsman that my solicitor did not inform me that I could be eligible for more time , either due to ACAS guidelines or just to call it fair/reasonable amount of time for SA without following ACAS guidelines. ACAS publishes guidelines not to be just easily disregarded and get with so easily. Govt funds their research and public consultation, not just to be trashed when it comes to use it. ACAS guidelines were never ever meant to be legally enforceable but to quantify certain parameter. So for SA, they believe at least TEN days must be given to call it fair, unless agreed or the circumstances are different.

[Emmzzi]

So have you been to get that lawyer yet?

[landlor]

I sent him a Complaint Mail. His defense is the same nonsense argument that ACAS guidelines are not legally enforceable ( and employer can trash them as per their convenience and that ACAS team must be a bunch of fools to have compiled some some hundred pages of guidelines and govt must be a bigger fools to fund public consultation and research). And that he did not know when the employer actually handed me the contract.

 

I have to wait and see what Ombudsman says. I have countered his second point that how can he start advising without ascertaining such basic facts of the case. For the first point, its same thing I have been telling here that one and half day is quite conspicuously unfair. After receiving his advise, I can potentially need further legal advise to evaluate my claims against employer.

 

So even if there cannot be a potential financial loss/gain for me, it definitely was Stressful and I will ask compensation for that.