Compromise Agreements Solicitors & Lawyers » Post Termination Restrictions after Signing a Compromise Agreement

Employment law Advice For Employers, Redundancies, Compromise Agreements – Offer of Employment

admin — Fri, 02 Jul 2010 17:20:36 +0000

Where senior executives have been paid handsomely, they are usually required to sign a compromise agreement in which they would have to, for a period of twelve (12) months following the Termination Date, undertake to notify the employer when an offer of alternative employment has been made and agree to provide the employer with such details of the offer as it considers reasonably necessary to apply the terms of the signed compromise agreement.

If you require further information please contact us at enquiries@rtcooperssolicitors.com or visit one of the following pages on employment law:

© RT COOPERS, 2010. This Briefing Note does not provide a comprehensive or complete statement of the law relating to the issues discussed nor does it constitute legal advice. It is intended only to highlight general issues. Specialist legal advice should always be sought in relation to particular circumstances.

Employment Lawyers – Payment in Lieu of Notice – Employment Solicitors – Compromise Agreements Solicitors

admin — Tue, 08 Jun 2010 11:36:06 +0000

Employees are constantly asking us whether their payments in lieu of notice (PILON) ought to be taxed. The answer is yes, theywill be taxed in the usual way plus national insurance will be payable. Any PILON will be included in an employee’s compromise agreement.

If you require further information please contact us at enquiries@rtcooperssolicitors.com or visit one of the following pages on employment law:

Employment Lawyers – Post Termination Provisions

admin — Wed, 05 May 2010 18:03:48 +0000

Post Termination Obligations

When senior executives are leaving a company, the company may add additional clauses to their compromise agreements to ensure that they are bound. A typical clause would be

“You acknowledge that you will continue to be bound by the terms of your employment contract in relation to Confidentiality, Intellectual Property, Inventions and Patents and Post-Termination Obligations.”

If you require further information please contact us at enquiries@rtcooperssolicitors.com or visit one of the following pages on employment law:

Employment Solicitors – Signing a Compromise Agreement – Counterparts

admin — Wed, 24 Mar 2010 00:36:19 +0000

Some employers are happy for the compromise agreement to be signed in counterparts. That means each party signs a separate agreement and they exchange so the employee gets a copy signed by the employer and the employer a copy signed by the employee. The compromise agreement has to make allowances for this, otherwise both parties have to sign the same document.

“This Agreement may be entered into in any number of counterparts and by the parties to it on separate counterparts, each of which when so executed and delivered shall be an original, but all the counterparts shall together constitute one and the same agreement.”

If you require further information please contact us at enquiries@rtcooperssolicitors.com or visit one of the following pages on employment law:

Employment Lawyers – Termination – Constructive Dismissal – Payment in Lieu of Notice (PILON) – PILON Payment or Termination Payment?

admin — Fri, 15 Jan 2010 15:17:06 +0000

Recent Case: Employment Law: Termination – Constructive Dismissal – Payment in Lieu of Notice (PILON) – PILON Payment or Termination Payment?

In this case of Clinton v HMRC [2010], an employer sought to terminate the employment of an employee and the employee sought to bring a claim for constructive dismissal against the employer. The employer paid the employee a ‘termination payment’ sum substantially the same as the employee’s entitlement by way of payment in lieu of notice (PILON). It was deemed by the Tax Chamber First Tier Tribunal (of the HMRC) that the payment was not made pursuant to a contractual entitlement but rather to extinguish the employee’s claim for constructive dismissal.

The significance of this decision was that the first £30,000.00 of the termination payment was therefore tax free, and the entire amount exempt from National Insurance contributions. The drafting of the PILON clause in this case is what caused much of the dispute.

It is important that PILON clauses in employment contracts are appropriately worded so as to ensure there is no discrepancy at such time as an employee leaves an employer’s employment.

If you require further information please contact us at enquiries@rtcooperssolicitors.com or visit one of the following pages:

Tax Indeminty

admin — Fri, 17 Jul 2009 11:49:00 +0000

Each compromise agreement has a tax indemnity. It usually causes a lot of discussions when we are advising Employees. It is a safe guard for the Employer in case the Employer has to make a payment to the Inland Revenue in respect of pyaments made to an Employee under a compromise agreement. A typical tax indemnity provision is as follows:-

Except in respect of income tax or employee’s National Insurance contributions deducted by the Employer, the Employee undertake to be, responsible for any income tax, employee’s National Insurance contributions, fines, interest, costs and/or penalties arising in respect of all and any of the payments made and benefits provided under this Agreement (”Tax Liability”) including, for the avoidance of doubt any Tax Liability on the first £30,000 of the Compensation Payment and Employee indemnify and will keep indemnified the Employer and any companies associated withthe Employer against any claim or demand which is made against the Employer or any companies associated withthe Employer in respect of any such Tax Liability. The Employee undertake immediately to pay to the Employer on demand any such Tax Liability.

Adviser’s Certificate

admin — Thu, 16 Jul 2009 21:42:32 +0000

The independent legal advise prov iding legal advice on your compromise agreement has to sign what is called an adviser’s certificate. An adviser’s certificate should include the following:-

‘I, [Name of Solicitor] am a relevant independent adviser within the meaning of s 203 of the Employment Rights Act 1996. I confirm that:

I am a relevant independent adviser within the meaning of section 203 of the Employment Rights Act 1996;

I am not acting (and have not acted) in relation to this matter for the Employer or any of its Associated Companies;

There is in force a contract of insurance, or a professional indemnity, as required by s 203 (3) (d) Employment Rights Act 1996, covering the risk of a claim against me in respect of the advice which I have given leading to the signature of this letter; and

I have advised the Employee of the terms and effect of the compromise agreement to which this certificate is attached and in particular in relation to its effect on his/her ability to pursue his/her rights before an Employment Tribunal in respect of those proceedings referred to in the compromise agreement following his/her acceptance of the terms of the compromise agreement.

Signed_____________________________ Dated__________________________

This will be signed by the Employee’s legal advisor.

Warranties in Compromise Agreements Cont’d

admin — Wed, 01 Jul 2009 22:27:32 +0000

1. You have received independent legal advice on all and any claims that you might be able to bring against your Employer in the Employer Tribunal and the High Court/County Court in respect of your employment and termination of employment.

2. You further warrant you have reviewed such claims with the Independent Adviser and been advised upon the possibility of pursuing such claims and you waive your rights to pursue such claims

3. You further warrant and confirm that:

i. You have no other complaints whatsoever against your Employer (except those referred to in the previous entries on warranties);

ii. You acknowledge that your Employer has agreed to pay the Severance Payment only on the strength of that warranty;

iii. Save in respect of claims relating to personal injury and pension rights (as explained in the earlier entries), you will refrain from presenting any complaint to an Employment Tribunal, County Court or High Court; and

iv. You will not present your Employer with any questionnaire, data subject access request or request under the Freedom of Information Act 2000 (if relevant) in relation to your employment or its termination or in relation to any other matter arising prior to the date of the Compromise Agreement except in respect of any breach or information which may come to light after the date of the Compromise Agreement.

More regulations in the next blog entry.

Warranties in Compromise Agreements Cont’d

admin — Wed, 24 Jun 2009 08:05:27 +0000

2. You further warrant you have reviewed such claims with the Independent Adviser and been advised upon the possibility of pursuing such claims and you waive your rights to pursue such claims. The warranties that we have discussed in this blog and which you will be required to give to your Employer, do not apply to the following:-

Any claim to enforce an Employee’s pension rights which have accrued up to the date of the compromise agreement under the Pension Scheme;
Any personal injury claim which an Employee is not aware as at the date of the compromise agreement; and
Any claim necessary to enforce the terms of the compromise agreement.

More regulations in the next blog entry.

Warranties in Compromise Agreements Cont’d

admin — Sun, 24 May 2009 08:37:48 +0000

We are continuing with our discussion on warranties in compromise agreements. Our previous entries explain a number of warranties that you will have to give to your employer. One of the key warranties is that:You have received independent legal advice on all and any claims that you might be able to bring against your Employer in the Employer Tribunal and the High Court/County Court in respect of your employment and termination of employment.You further warrant you have reviewed such claims with the Independent Adviser and been advised upon the possibility of pursuing such claims and you waive your rights to pursue such claims, including but not limited to any claim for:

Any personal injury claim resulting from the Employee’s employment with the MRC of which he was aware as at the date of this agreement;
Failure to provide written reasons for dismissal.

More regulations in the next blog entry.