A Settlement Agreement is a legal document that sets out the terms and conditions agreed between the employer and employee to end the employment relationship or settle a dispute which has the potential to end up at an Employment Tribunal.
It is most commonly used where the employee submits a claim for unfair dismissal and a settlement is negotiated to avoid a formal Tribunal Hearing. However, there is no legal requirement to be involved in disciplinary action or a claim against the employer.
The Workplace Relations Bill 2014 proposes to reform the system for regulating employment rights by abolishing the Equality Authority, National Employment Rights Authority, Labour Relations Commission and the Employment Appeals Tribunal and replacing them with the Workplace Relations Commission (WRC).
The problem with the existing system was that it is so complex that even practitioners had difficulty navigating it; there were long delays scheduling hearings and further delays in issuing decisions; it was open to abuse (Forum Shopping- referring the same case to a number of different bodies) and it could cost €4000 to €10000 to defend a case.
A certain degree of pressure is an essential part of the working life – change is created by the imbalance between driving forces and the inertia which has a hold on most organisations.
The rate of change is increasing, research suggests that an organisation will experience major change every 3 years and within that cycle there will be numerous minor events. Major change may result from new products or technology; buying or selling the business; restructuring or redundancy; new management personnel. Pressure for smaller changes maybe anything from shifts in policy; response to market pressures; incremental changes to improve productivity; or response to
If an employee chooses to make a claim under the Unfair Dismissal Act 1977, the Tribunal must assume that the employer has unfairly dismissed the employee.
Despite the fact that the employee makes the complaint, the onus is on the employer to prove their case. The employer must establish substantial grounds for the dismissal and prove that he complied rigorously with established policy and procedure. It is very often the case that the employer loses the case because of breach of ‘fair procedure’.