How to negotiate your settlement agreement
The first thing to bear in mind is that this is a negotiation and what you are offered at the outset, as generous as it may be, is unlikely to be the best deal you can get. Recognise that negotiations often involve give and take. Be willing to consider reasonable compromises and explore potential solutions that can meet both parties’ interests. You should determine your goals and priorities for the settlement.
It is useful before starting to negotiate your settlement agreement, to provide your employment lawyer with a copy of your contract of employment and any correspondence to do with your job exit.
Remember that each negotiation is unique, and the approach may vary based on the specific circumstances. It is important to be well-prepared, maintain a collaborative mindset, and strive for a mutually beneficial resolution.
There will be many aspects to your settlement agreement negotiation but some points to remember:
- Your first £30,000 will usually be tax free
- Work out what you want out of the agreement first and be prepared to compromise on some small points to get what you want
- Ask for outplacement support to be included. Think how long it will take you to get back into work – will the payments cover this period? A senior manager can often take 6 months to get back into work. Outplacement support can get you back into work quicker and into a job more aligned to your talents. Your organisation may want you to us their own provider but you should be able to choose your own. some are limted to a few months of support for example. Personal Career Management can advise you on what type of support may be best for you and on programme costs to include.
- Your employment lawyer should advise on how the payments can be made in the most tax efficient way. Outplacement is tax free as part of a settlement agreement and won’t come off your £30,000 allowance
- Be careful about restrictions placed on you to do with future work. Restrictions whilst protecting your employer, may impede your ability to work for a competitor; work elsewhere in your industry; or even set up your own business