Unenforceable Compromise agreements
With the Equality Act 2010 being introduced little over a month ago, we have already, seen its first problem, namely compromise agreements being rendered potentially void and unenforceable.
It appears that when drafting the provisions for compromise agreements under the Equality Act, the Government have inadvertently made it impossible to reach a binding agreement. With such important ramifications for employers in this area of law, we have taken this opportunity to speak with Wendy Curlett, Team Leader, at recently rebranded Bibby Consulting and Support (formerly mhl support) who explains further about these latest complications.
Wendy explained that “in order to make a compromise agreement binding, an employee needs to receive independent legal advice as to its contents and on their ability to pursue claims to an Employment Tribunal. This advice will typically come from a solicitor, although others are able to provide this advice such as trade union officials and advisers at voluntary organisations such as the Citizens Advice Bureau.
However, in its current form, the Equality Act 2010 precludes an adviser from being independent if they have given advice to the employee about their potential complaint. This causes a catch 22 situation; as making the agreement binding involves the legal adviser giving advice to the individual about the complaint, but then doing so precludes them from being independent.”
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As such, Wendy stressed that “employers wishing to reach financial agreements in respect of potential claims under the Equality Act 2010 need to think carefully about how they proceed, as progressing with a standard form compromise agreement is unlikely to offer an acceptable solution. There are however, ways to overcome these difficulties and still reach a binding agreement.”
Bibby Consulting and Support have formulated further guidance on this topic which is available to clients and to all readers. If you are an existing client, please call one of the team today on 08453 100 999 quoting your PCN number to discuss the situation with one of our specialist advisers and to obtain more comprehensive guidance. If however you are not yet a client of Bibby Consulting and Support, but would like to receive a copy of the free guidance, please complete your details below and this will be sent to you. Additionally, if you are interested in learning more about the services that Bibby Consulting and Support provide, please call Katy Vaughan today on 08453 100 600 for your free no obligation meeting.
This News Release is intended to provide a general overview and discussion of the subject matter. It is not however, intended to give advice or to act as a substitute to taking legal advice from our Support Line in any specific situation. Bibby Consulting & Support accepts no liability or responsibility for the information contained within this news release. If you would like specific advice about this subject matter, please contact one of the Employment Law Team today on 08453 100 999.
