In employment law, an agreement (formerly known as a compromise agreement) whereby an employee or worker agrees not to pursue certain statutory employment tribunal claims against a respondent or potential respondent to a claim. Commonly used to record an employee's terms of departure where they are to receive a termination payment in return for the waiver of all actual and potential statutory (and usually common law) claims against the employer.
For a valid waiver of statutory employment rights, certain statutory conditions must be met:
The agreement must be in writing.
The agreement must relate to a particular complaint or particular proceedings.
The employee must have received independent legal advice on the agreement and in particular on its effect on their ability to pursue the statutory rights in question.
The adviser must be identified in the agreement.
The adviser must have insurance in relation to the advice.
The agreement must state that the conditions regulating settlement agreements in the relevant legislation have been met.