A settlement agreement is a legal agreement between an employee and an employer. Previously referred to as a compromise agreement, a settlement agreement is usually entered into shortly before or after an employee`s contract is terminated. They are often used for dismissals, but can be agreed in other circumstances, such as disciplinary proceedings. Settlement agreements are often used in the context of a dismissal situation, sometimes as a way for your employer to avoid a dismissal procedure. This usually means that your employer takes into account your legal right to severance pay. On the one hand, the larger the company, the more likely it is to have competent staff. On the other hand, the more a company employs, the more likely it is that there are standard „Boiler Plate“ transaction agreements that are not adapted to your own circumstances. It is not possible to include damages paid for loss of notice in the £30,000 tax allowance. . .