There are a number of elements required to ensure a settlement agreement is binding but one is that it is not binding until both the employee and employer have signed it.
As it isn’t binding until it is signed by both parties an employer could withdraw or cancel the settlement agreement up until that point – even at the very last minute. An employee could also change their mind about entering into a settlement agreement if they haven’t signed it. This is important to remember when negotiating settlement agreement terms and sums.
Once the settlement agreement has been signed it cannot be unilaterally withdrawn as such, however, it can be varied/amended with agreement of both parties with the variation being recorded in writing. Further, if the employee commits a fundamental breach of the settlement agreement the employer may decline to make the payments under the agreement or seek to recover them if the sums if they have already been paid.
If you have been offered a settlement agreement it is important that you take time to consider whether it is suitable for you in the circumstances. That said, employers often set deadlines (around 7-10 days is common) to decide. We can often negotiate with employers to increase the deadline but if one is set it would be prudent to bear that timescale in mind and instruct a solicitor sooner rather than later because the employer could withdraw the offer.
If you need advice on a settlement agreement with a quick turnaround please contact us on 01483 303636 or via our contact us page.