Settlement Agreement Counter-Offer
Response to an employer's settlement agreement offer requesting more favourable terms.
This template was not drafted by a solicitor.
It is an editorial reference based on the official sources we cite. You are responsible for any document you send. For high-stakes matters (court proceedings, large sums, deportation, criminal allegations, child welfare), have a regulated solicitor review or draft your document.
When to use this template
When your employer has offered a settlement agreement (under s.203 ERA 1996) and you want to negotiate before signing.
When NOT to use this template
Before you have obtained independent legal advice — settlement agreements are not binding without it; if you do not want to settle at all (just don't sign).
Legal Basis
Employment Rights Act 1996 s.203; ACAS Code of Practice on Settlement Agreements.
Before you send
- Signing before getting independent legal advice from a relevant independent adviser (statutory requirement)
- Agreeing to a confidentiality clause that goes beyond what's reasonable (e.g. waiving protected disclosure rights)
- Accepting the first offer — employers typically have headroom to improve
Common Mistakes to Avoid
- ✗Signing before getting independent legal advice from a relevant independent adviser (statutory requirement)
- ✗Agreeing to a confidentiality clause that goes beyond what's reasonable (e.g. waiving protected disclosure rights)
- ✗Accepting the first offer — employers typically have headroom to improve
Build Your Letter
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Letter preview
[Your Name] [Your Address] [EMPLOYER HR CONTACT NAME] [Employer Address] Date: [DATE] WITHOUT PREJUDICE AND SUBJECT TO CONTRACT Dear [EMPLOYER HR CONTACT NAME], Proposed Settlement Agreement Thank you for your letter of [DATE EMPLOYER'S OFFER RECEIVED] enclosing a draft Settlement Agreement. I have taken legal advice and would like to respond as follows. 1. Termination payment The proposed termination payment of £[AMOUNT OFFERED (£)] does not adequately reflect my potential claims, which include [POTENTIAL CLAIMS YOU HAVE]. A more appropriate sum would be £[YOUR COUNTER-OFFER (£)]. This reflects: - Statutory redundancy entitlement (if applicable): £[STATUTORY REDUNDANCY (£)] - Notice pay: £[NOTICE PAY (£)] - Loss of earnings (mitigated): £[LOSS OF EARNINGS (£)] - Compensation for [discrimination / unfair dismissal / injury to feelings as applicable]: £[INJURY TO FEELINGS / DISCRIMINATION (£)] - Legal fees contribution: £[LEGAL FEES CONTRIBUTION (£)] 2. Reference I request that the agreement provide for an agreed factual reference (text attached as a schedule) and undertake that the employer will respond to reference enquiries only in those terms. 3. Confidentiality and non-derogation I agree to reasonable mutual confidentiality and non-derogation provisions, but I cannot waive my right to make protected disclosures (Public Interest Disclosure Act 1998), give evidence in legal proceedings, or report criminal offences. Please confirm the agreement preserves these statutory rights. 4. Outplacement support I request £[OUTPLACEMENT BUDGET REQUESTED (£)] for outplacement / career coaching support. 5. Tax The first £30,000 of the termination payment is tax-free under s.401 ITEPA 2003. The remainder must be paid via payroll with appropriate tax deductions. Please confirm the structure of payments and tax treatment in the revised draft. 6. Legal fees In accordance with the ACAS Code, I request that you pay my legal fees direct to my adviser, currently estimated at £[LEGAL FEES CONTRIBUTION (£)] plus VAT. I look forward to your response and a revised draft. Yours sincerely, [YOUR NAME]
Unfilled fields appear as [FIELD NAME]. Review the letter carefully before sending. This template is a starting point — adapt it to your specific circumstances.