Everyone has a personal reaction to being offered a Settlement Agreement by their employer. Some are absolutely delighted to leave their workplace and view any compensation package as an unexpected and welcome bonus. However, for others, being offered a Settlement Agreement out of the blue can come as a complete shock and undermine the relationship they thought they had with their employer.
My client came to see me having been offered a Settlement Agreement by her employer. She worked as a Shop Manager for a large national company and had been with them for over 20 years. She was a diligent and hardworking employee, having received successive promotions all the way from being an Apprentice up to the Manager of one of their larger stores.
She commented that problems at work began when, following a very personal trauma, she began to suffer with anxiety and depression. Initially, the company were supportive and additional resources were provided to enable her to continue in her position. However, upon the appointment of a new Area Manager, she was informed that she would have to ‘stand on her own two feet’. The additional resources and assistance she was receiving were removed overnight. She was then informed that she was being transferred to a shop several miles away and that the Area Manager would be ‘keeping an eye’ on her.
Unsurprisingly, the behaviour of her Area Manager and the withdrawal of the assistance she had been receiving, combined with her being sent to a store several miles away, impacted upon her mental health. Pressure was further increased when she was subjected to a number of spurious disciplinary investigations. She believed these were engineered by her Area Manager in an attempt to force her into resigning.
In the event, she was subjected to a disciplinary process regarding completely bogus allegations of misconduct. At the same time, her employer initiated a performance improvement procedure in respect of her targets at the new store. The initiation of this procedure was also unfair as she had only been working at the store for four weeks and inherited a target deficit from the previous manager. She buckled under the pressure and began a period of ill health absence due to work related stress.
Her employers then contacted her with a ‘way forward’. She had only been absent from work for a few days when they sent her a Settlement Agreement. The ‘deal’ was that she would resign her employment and give up all her Employment Tribunal rights in exchange for one months’ basic salary as the compensation package. They told her that if she did not sign, in addition to the procedures she was already subject to, they would also initiate an attendance management procedure.
When my client brought in the Settlement Agreement, she was in a state of some distress. She was struggling to understand why her employer was treating her in this way. She had done nothing wrong.
We discussed the details of the disciplinary procedure. She explained the allegations were for processes she and her colleagues had been following for 20 years. She was not aware of any other employee who had been subject to a disciplinary procedure for this type of incident.
With regard to the performance improvement procedure, when she began working at the store the stock was in disarray. It had taken her some considerable time to update all the systems. Indeed, she explained that the outgoing Shop Manager had left in a hurry and there were simply no stock records or similar. Therefore, she could not even begin to go forward until she had undertaken a full audit and identified what stock was held. Her Area Manager was well aware of this and, indeed, had acknowledged that the company had no clue as to stock levels at that store until she took over. In the circumstances, she explained that she could not understand how she would be subject to a performance management procedure. She also commented that she was not aware of any colleague being subjected to such a procedure when they had only been allocated to the store for four weeks.
My client stated she was simply beaten by the current threat of the absence management procedure. Given she had only been off for a few days, she didn’t think her attendance levels had even triggered the process at the time of our meeting. She was aware of colleagues being off for weeks and months before the company started the absence management procedure. However, for my client, they clearly intended to rush the process through to her dismissal.
The pressure upon her was such that she wanted to bring the whole situation to an end and commented that she just wanted to sign their offer and go home. I (gently) persuaded my client to let me try and renegotiate her Settlement Agreement. As she had clearly indicated that she wanted to leave her employment, she had very little to lose by my representing her to see if I could get a better compensation package.
I explained that should she wish to pursue her matter at the Employment Tribunal, I believed she could have claims for direct disability discrimination, discrimination arising from disability and failure to make reasonable adjustments (amongst many others). I also explained that even if they did use one of their procedures to dismiss her, she would get her statutory notice. This would be 12 weeks’ pay as against the one month she was being offered as a compensation package to give up all her employment rights and claims. In the circumstances, she was in an extremely strong negotiating position.
She agreed to let me try and negotiate. A couple of weeks later, we met again to sign a Settlement Agreement. This time the compensation package included three months’ notice pay in lieu, a compensatory payment equivalent to nine months’ pay, payment of outstanding bonuses and a few other bits and pieces for holiday, company car etc.
My client was delighted with the revised compensation package and looked like a completely different woman at our last meeting. She stated that she felt she could now move forward and, indeed, had already started applying for new positions. I was equally delighted to see her looking so positive and happy, a complete contrast to her demeanour at our first meeting.
If you have been given a Settlement Agreement by your employer and want to discuss the compensation package you have been offered, call 01522 440512 for a free, no obligation discussion about your situation. Alternatively, for more information about me and my colleagues at Lincs Law Solicitors, please visit our website at www.lincslaw.co.uk/services/settlement-agreements
Specialist Employment Law Solicitor
Lincs Law Solicitors, Lincoln.
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