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The Settlement Agreement (formerly known as a Compromise agreement) will usually be a lengthy document setting out what payments you will receive and what they relate to. It will also set out what parts of the settlement will be taxed and what will be paid to you free of tax.
 
The Settlement Agreement will also set out which Employment Tribunal claims you are agreeing not to pursue against your employer in the future.
 
Often the Settlement Agreement will have confidentiality clauses in it to ensure that you agree to keep your employer’s business affairs confidential.
 
Sometimes the Settlement Agreement will be written to include an agreed reference to ensure that you have no difficulties in obtaining a reference when you look for new employment. This gives you the certainty that you have a good chance of getting a new job.
 
The Settlement Agreement will have a number of other clauses in it which we will go through with you so you understand what you are signing.