DATED xxxxxxxxxxxxx
SETTLEMENT AGREEMENT
WITHOUT PREJUDICE
SUBJECT TO CONTRACT
Xxxxxxxxxxxxx (company name)
AND
Xxxxxxxxxxxxx (employee name)
THIS AGREEMENT IS MADE THE xxxxxxxxxxxxx
B E T W E E N:-
(1) xxxxxxxxxxxxx LIMITED registered and incorporated in England and Wales under company number xxxxxxxxxxxxx whose registered office is at xxxxxxxxxxxxx (“the Employer”);
AND
(2) xxxxxxxxxxxxx of xxxxxxxxxxxxx (“the Employee”)
WHEREAS:-
A. The Employee is employed by the Employer as xxxxxxxxxxxxx
B. The Employee's employment with the Employer will terminate on xxxxxxxxxxxxx.
C. The Employer and the Employee have agreed the terms set out in this Agreement in full and final settlement of all claims that the Employee has or might have against the Employer arising out of his employment or its termination.
D. The parties intend this agreement to be an effective waiver of any such claims and to satisfy the conditions relating to compromise agreements in the relevant legislation.
E. The Employer enters into this agreement for itself and as agent and trustee for all Group Companies (hereinafter defined at clause 1 below) and it is authorised to do so. It is the parties' intention that each Group Company should be able to enforce any rights it has under this agreement, subject to and in accordance with the Contracts (Rights of Third Parties) Act 1999.
IT IS AGREED:-
1. DEFINITIONS
In this Agreement:
1.1 “Group” means the Employer, its subsidiaries, any company of which it is a subsidiary (its holding company) and any other subsidiaries of any such holding company; and each company in a group is a member of the group. “Holding company" and "subsidiary" shall be as defined in section 1159 of the Companies Act 2006, and a company shall be treated, for the purposes of the membership requirement contained in subsections 1159(1)(b) and (c), as a member of another company even if its shares in that other company are registered in the name of (i) another person or other entity (or its nominee), whether by way of security or in connection with the taking of security or otherwise, or (ii) a nominee.
1.2 “Group Company” means any company of the Group.
1.3 “Contract of Employment” means xxxxxxxxxxxxx.
1.4 “Termination Date” means xxxxxxxxxxxxx.
2. TERMINATION
2.1 The Employee’s employment with the Employer will terminate on the Termination Date.
2.2 The Employee will be paid all basic salary and other contractual benefits due to him under the Contract of Employment up to and including the Termination Date plus xxxxxxxxxxxxx salary in lieu of notice.
2.3 The Employer shall make a payment to the Employee in respect of outstanding holiday accrued up to and including the Termination Date.
2.4 The payments and benefits in this clause 2 shall be subject to the income tax and national insurance contributions that the Employer is obliged by law to pay or deduct.
2.5 Save as expressly provided in this Agreement, all payments and benefits which the Employee has received or is entitled to receive in connection with his employment or under the Contract of Employment (or otherwise) shall cease with effect from the Termination Date.
2.6 The Employee agrees that except for the payments and benefits provided for in this Agreement he shall not be eligible for any further payment from the Employer or any Group Company relating to his employment or its termination and expressly waives any right or claims that he has or may have to the payment of any benefit, bonus, commission or other payments.
3. COMPENSATION PAYMENT
3.1 Subject to the Employee’s compliance with the Employee’s obligations under this Agreement the Employer shall, without any admission of liability, pay the Employee the sum of £ xxxxxxxxxxxxx representing a payment of compensation for loss of employment (“the Compensation Payment”).
3.2 The Employer and the Employee believe that the Compensation Payment will be tax free under sections 401 and 403 of the Income Tax (Earnings and Pensions) Act 2003, but the Employer gives no warranty as to the tax treatment of the Compensation Payment. The Employee shall be responsible for any further tax and employee's national insurance contributions due in respect of the Compensation Payment.
3.3 The Compensation Payment and the payments referred to at clauses 2.3 and 2.4will be paid to the Employee within 21 business days of receipt by the Employer of a copy of this Agreement signed by the Employee and a signed letter from the Adviser as set out in Schedule 1; or within 21 business days following the Termination Date; or within 21 business days following the Employee’s compliance with clause 5 (to the reasonable satisfaction of the Employer), whichever is the later.
3.4 It is recorded that terms numbered 4, 5, 6, 8 and 9 are fundamental terms of this Agreement and the Employer would not have entered into this Agreement had these terms not been agreed.
3.5 If the Employee breaches any of the terms numbered 4, 5, 6, 8 and 9 then the Compensation Payment shall be repaid by the Employee to the Employer (for the avoidance of doubt such repayments shall be recovered by the Employer as a debt and shall be free from any set off or cross claim). The Employee acknowledges that this is a genuine pre-estimate of any loss to the Employer.
3.6 If the Employee commences legal proceedings against the Employer or any Group Company in respect of the Alleged Claim (as hereinafter defined at clause 8) or for any of the claims set out in Schedule 2 hereof the Compensation Payment shall be repaid by the Employee to the Employer (for the avoidance of doubt such repayments shall be recovered by the Employer as a debt and shall be free from any set off or cross claim). The Employer acknowledges that this is a genuine pre-estimate of any loss to the Employer.
4. TAX INDEMNITY
4.1 Whilst it is the parties’ understanding that the Compensation Payment referred to at 3.1 above is a payment paid under Section 403 of the Income Tax (Earnings and Pensions) Act 2003 and that the first £30,000 of the payment can be paid tax free the Employer gives no warranty as to the tax treatment of the Compensation Payment and it is agreed that any liability to tax that there may be on any other payment or benefit provided to the Employee pursuant to this Agreement shall be the Employee’s alone.
4.2 The Employee undertakes that if the Employer is called upon to account to HM Revenue & Customs for any additional income tax, employee’s national insurance contributions, interest, costs and / or penalties thereon arising in respect of the payments made and the benefits provided under this Agreement (such income tax, employee’s national insurance contributions, interest and / or penalties referred to in this Agreement as the “Excess Tax”) and if the Employer pays the Excess Tax to HM Revenue & Customs, the Employee will at the request of the Employer immediately pay to the Employer an amount equal to the Excess Tax (on an after tax basis) provided that the Employer shall notify the Employee in writing as soon as reasonably practical of any claim or contention by HM Revenue & Customs that such Excess Tax is or might be due.
5. RETURN OF PROPERTY
5.1 The Employee hereby undertakes that prior to the Termination Date he will account for and return to the Employer all property belonging to the Employer which is or has been in the Employee’s possession or under his control. This includes but is not limited to (for example) blackberry mobile phone, laptop computer, HSBC company credit card, documents, records, computer discs, files, keys, security passes, and any other information: whether originals copies or extracts and whether or not stored electronically. Documents and electronically recorded information include but are not limited to correspondence, files, papers, reports, minutes, plans, records, diagrams, computer print-outs floppy discs, manuals, customer documentation or any other medium for storing information and all copies. The Employee warrants that prior to the Termination Date, he will permanently delete from any personal computer or email account or other facility all electronic files relating to his employment with the Employer or any Group Company, their customers or potential customers, employees or suppliers.
6. CONFIDENTIALITY
6.1 The Employee hereby undertakes to honour his existing confidentiality obligations as implied by law and agrees not to divulge or make use of (whether directly or indirectly whether for his own or another’s benefit or purposes) any trade secrets or confidential information (including but not limited to customer lists, pricing lists, business plans, technical data, existing and potential projects, financial information including pricing information, dealings and plans, sales specifications and information, business developments and plans, past and proposed business dealings or transactions) belonging to or which relate to the affairs of the Employer or the Group or any document properly marked “confidential” or any document which the Employee has been told is “confidential” or information which to the Employee’s knowledge or in respect of which the Employee ought reasonably have been aware, has been given in confidence to the Employer or the Group by a third party or information which to the Employee’s knowledge or in respect of which the Employee ought reasonably have been aware is confidential to the relationship between the Employer and the Group and any of its customers, suppliers or beneficiaries. This obligation shall be without limitation in time but shall not apply to any information that is in or comes into the public domain other than by way of unauthorised disclosure by the Employee.
6.2 The Employee undertakes that he will not at any time make any disclosure or representation to any person whether directly or indirectly with regard to the fact, terms of this Agreement (including details of any negotiations leading up to this Agreement and / or any statement that the Employee has succeeded in his claim or potential claim against the Employer). This provision does not prevent the Employee from disclosing such information on a confidential basis to their legal and / or professional advisers, to HM Revenue & Customs, any other appropriate taxing authority or as required by law, and to his immediate family provided that disclosure to such permitted persons shall be on terms that they keep such disclosure confidential. It is specifically recorded that this term is a fundamental term of this Agreement. For the avoidance of doubt if any third party first becomes aware of this Agreement from the Employer or an employee or officer of the Employer other than the Employee then the Employee shall not be deemed to be in breach of this clause.
6.3 The Employee undertakes that he will not, whether directly or indirectly make publish or otherwise communicate any disparaging remarks or derogatory statements whether in writing or otherwise concerning the Employer or any Group Company (to include any of its or their officers, shareholders or employees or former officers, former shareholders or former employees).
7 LEGAL FEES
7.1 The Employee will be responsible for his own legal fees for advice relating to the negotiation and preparation of this Agreement/The Employer will pay £ xxxxxxxxxxxxx towards the Employee’s legal fees in relation to this agreement.
8 SETTLEMENT OF CLAIMS
8.1 The Employee warrants, undertakes and represents that:
8.1.1 he has instructed his legal adviser to advise whether he has or may have any Statutory Claims (as defined in Schedule 2) against the Employer any Group Company, or any of its or their officers, employees or shareholders, arising out of or in connection with his employment by the Employer and the termination of his contract of employment;
8.1.2 he has provided his legal adviser with whatever information is in his possession to enable his legal adviser to advise whether he has or may have any such Statutory Claims;
8.1.3 he, having had legal advice from his legal adviser, may have a claim for unfair dismissal, wrongful dismissal and/or breach of contract against the Employer, any Group Company, or its or their employees, directors or shareholders (together defined as the “Alleged Claim”), which has been raised with or notified to the Employer;
8.1.4 he, having had legal advice from his legal adviser has no Statutory Claims other than those referred to in Clause 8.1.3 against the Employer, any Group Company or its or their officers, employees or shareholders, arising out of or in connection with the termination of his contract of employment.
8.1.5 the matters on which the Alleged Claim are based are that:
(a) The Employee is employed by the Employer in his role as Quality Manager.
(b) Both parties have agreed to terminate the Employee’s employment with the Employer pursuant to the terms of this Agreement.
8.2 The Alleged Claim is hereby unconditionally and irrevocably waived by the Employee and will not be repeated, referred to or pursued either by the Employee or by anyone else on his behalf.
8.3 The Employee agrees to accept the terms of this Agreement and the payments provided for herein in full and final settlement of the following claims:
8.3.1 the Alleged Claim; and
8.3.2 all other claims and rights of action (whether under common law or otherwise) in any jurisdiction in the world, howsoever arising, (including but not limited to Statutory Claims, contractual claims, breach of contract and tort) which the Employee has or may have against the Employer, any Group Company or its or their officers, employees or shareholders, arising from or in connection with the Employee’s employment and/or the termination thereof