Settlement Agreements and Disciplinary Procedures

Disciplinary Procedures and Settlement Agreements

Q: I was asked to attend a disciplinary hearing without any notice or chance to bring a companion. At the end of the meeting I was offered a settlement agreement. I know I’ve not done anything wrong and feel my employer is putting me under undue pressure to take the settlement and leave. Any advice?

You might think disciplinary procedures and settlement agreements don’t mix but sometimes they do.

John Norrie at Gillespie Macandrew LLP answers…

Firstly, and importantly, you don’t have to sign a Settlement Agreement if you don’t want to.  You should only proceed if, having looked at and considered the alternatives, and having taken advice, you conclude that is your best option.

When offering settlement agreements in these circumstances employers are, in effect, offering a package (usually financial) in return for an employee’s agreement to leave and the employee’s agreement not to raise any claims due to losing their job.  The law makes it easy for employers to make these offers “off the record” meaning the fact an offer has been made may well be inadmissible in any future tribunal claims, should things ever get that far.  The exact circumstances in which the offer was made will need to be considered to establish whether the offer has been made in the proper way to make it inadmissible.

In relation to disciplinary action, if you genuinely haven’t done anything wrong you may be in a stronger negotiating position than you think.  Also, when taking disciplinary action it is generally accepted as good practice that employers give you prior written notice of the date and time of any hearing, details of the alleged misconduct, and inform you of your right to be accompanied by a work colleague or union representative.  Any disciplinary action taken thus far may, therefore, be procedurally unfair.

The best way to proceed from here is to consider what will likely happen if you refuse the proposed settlement agreement.  For example, can and will your employer proceed with further disciplinary action; might that ultimately result in your dismissal; might you end up resigning because it all becomes impossible; what legal recourse would you then have e.g. unfair dismissal; how good are the prospects of you winning any such claim at tribunal, how much might that cost and how long might that take?  

To answer these questions, and to properly weigh up your options, you need to take advice from an employment lawyer now.  In any event, it is a legal requirement that you take independent legal advice before signing a settlement agreement, so you should seek advice now while matters are at a critical stage.  

Your lawyer will wish to better understand why things have reached this stage, check whether the recent disciplinary process has been conducted properly and fairly, and gauge whether your employer can lawfully continue with further disciplinary action.  Thereafter your lawyer will help you make the right choice and support you in fighting back.  This may be in the form of helping you fight any further disciplinary action if you wish to stay in your job or, alternatively, negotiating the best possible package should you wish to explore leaving your job.

So, in summary, your employer can only discipline you if you have done something wrong, and they must do so in a fair manner.  You don’t have to sign an agreement if you don’t want to, but you need to find out if it is better than the alternatives.  It’s time to fight back.

Answer given by John Norrie at Gillespie Macandrew LLP on 2 October 2013


IMPORTANT: The contents of this page are for guidance only and do not constitute legal advice. You should consult a solicitor without delay if you require legal advice on a particular employment matter.

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