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voluntary redundancy and settlement agreements

Following the recent recommendations to merge the 22 councils in Wales to 10, coupled with the continuing financial difficulties of those local authorities, the future of those employed within councils across Wales has never been so uncertain.

The private sector also doesn’t seem to be going unscathed as both Lloyds TSB and Barclays have this month announced nationwide job cuts.

Although such plans are likely to result in compulsory redundancies, employers must comply with a number of duties before they can fairly make employees redundant. Such duties include undertaking a fair consultation process, along with trying to find suitable alternative employment for those employees at risk of redundancy.

Given the amount of hurdles an employer has to jump over in a redundancy process, employers sometimes offer those potentially at risk of losing their job the opportunity to opt for voluntary redundancy.

If an employee chooses voluntary redundancy, the benefits are usually better than if the process is done compulsorily. This makes a voluntary redundancy package more appealing, especially if the employee's position is already at risk anyway.

However it is important to note that applying for voluntary redundancy doesn't necessarily mean you'll be accepted. This is usually down to the final decision of the employer.

Voluntary redundancy and settlement agreements

In the event of your application for voluntary redundancy being accepted, the employer will most likely require you to sign a Settlement Agreement. This is a legally binding contract which will set out particulars such as when your employment shall terminate and the amount of your severance package, but will also set out that upon you signing the Settlement Agreement, you will not be able to proceed with any claims against your employer for anything in connection with your employment or its termination, for example unfair dismissal or discrimination.

As the result of you signing such an agreement, you effectively agree to waive any employment rights you have accrued during your employment. Therefore it is a legal requirement of a Settlement Agreement that you obtain independent advice from a solicitor.

The solicitor will ensure you fully understand the terms of the contract, particularly its ability to restrict you from taking any future action against your employer. The fees for obtaining such independent advice is usually paid for by the employer.

Have you been offered voluntary redundancy? Talk to Howells today

Here at Howells Solicitors, our Employment Specialists have a wealth of experience in dealing with Settlement Agreements, ensuring that you receive clear, practical advice as to the contents of the agreement and the benefits you shall receive upon signing.

We offer a prompt and sensitive service which can involve meeting one of our experts to go through the agreement in person or arranging a suitable time to go through the agreement with you over the telephone. Find out more about our settlement agreements online today or call us on 0808 178 2773.

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