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All Legal Journeys
Employment Law
UK-wide
5 stages
2–6 weeks
Reviewed 2026-05-22
Settlement agreement journey
From employer's offer through independent advice, negotiation, and signing of a binding s.203 ERA 1996 settlement.
Who Uses This Journey
Employees offered a settlement agreement to compromise statutory employment claims.
Stage-by-Stage Timeline
1
1
Receive the offer
Employer presents agreement. Marked 'without prejudice subject to contract'.
2
2
Take independent advice
Statutory requirement — solicitor, union rep, or advice-centre worker. Employer must pay a contribution to legal fees (£500–£1,000 typical).
Common Mistakes to Avoid
- Signing before advice — invalid
3
3
Negotiate
Counter-offer on amount, reference wording, post-termination restrictions, tax structuring.
4
4
Sign
Final signed agreement is binding. £30,000 of termination payment is tax-free under s.401 ITEPA 2003.
5
5
Compliance
Both sides comply with terms (payments, references, return of property, confidentiality).