Government to unveil 'settlement agreements' for dismissals
The Government is to announce the introduction of settlement agreements, designed to enable employers to encourage employees to leave in return for an agreed pay-off.
The agreements, to be unveiled by business secretary Vince Cable at the second reading of the Enterprise and Regulatory Reform Bill, are designed to make it easier for employers to address workplace disputes.
Settlement agreements are a simplified version of compromise agreements, already in use by larger employers, and the Government hopes that their introduction will encourage more employers, particularly smaller ones, to use them before formal disputes arise. The Government says that because settlement offers and discussions cannot be used as evidence in unfair dismissal claims, these details cannot be used against employers at a tribunal.
Employees will continue to benefit from their employment rights, as they can choose to reject the offer of a settlement agreement and proceed to a tribunal.
June 14, 2012