Whilst most employers have specific claims in mind when they present a settlement agreement to an employee, the current convention is that they add in every conceivable that could be brought by the employee. These often run to three pages and include obscure transnational data protections and maternity rights for men. In addition, these agreements often contain a generic ‘catch all’ which attempts to settle claims that are not in the contemplation of the parties or those arising in the future.
However, the rules governing settlement agreements have always stated that the document must identify a ‘particular complaint(s)’ and tribunal judges are constantly criticising employers and their solicitors for adopting the ‘kitchen sink’ approach.
Now a new Employment Appeal Tribunal case (Bathgate v Technip UK Ltd) had restated the law and made it clear that future claims, not in the contemplation of the parties, cannot be settled in advance. Here, a new age discrimination claim arose after Mr Bathgate had signed away all his rights to make a claim in a settlement agreement.
Whilst this is a technical point, employees signing settlement agreements can now confidently do so knowing that if the employer does do something untoward at a later date, they may still have a right of action against them.
Of course, certain future claims have always attracted special treatment; and personal injuries of which the employee is not currently aware and pension claims are carved out in most agreements as the employee is very unlikely to be aware of, say, an asbestosis diagnosis or an issue with their occupational pension, perhaps decades in the future.
In addition, there are some claims that the employer cannot contract out of. Legitimate whistleblowing claims may be brought at any time, even if the employee has signed all their rights away, and an employer can never stop an employee from reporting a crime to the police, a tax issue to HMRC or a health and safety concern to the HSE.
For further information, please contact Ian Pearson ian.pearson@amicus law.co.uk
