- Does the employee have a potential unfair dismissal claim?
- What prospect of success does their unfair dismissal claim realistically have?
- What’s a reasonable value for the employee’s potential unfair dismissal claim?
- How much is the employee being offered in the compromise agreement?
- Is the termination of the contract of employment acrimonious or not?
Does the employee have a potential unfair dismissal claim?
This is probably the most important consideration in determining whether an employee should enter into a compromise agreement relating to a potential unfair dismissal claim. If the employee has a potentially large prospect of success in an unfair dismissal claim in the Employment Tribunal then they will be in a stronger negotiating position with their employer – their employer will be aware of the strength of their claim, the potential cost of conducting the claim, and the time and stress involved in doing so. However, if the employee doesn’t have a strong claim then they are not in a position to negotiate as aggressively (or at all).
Read more: An explanation of the law of unfair dismissal
What prospect of success does their unfair dismissal claim realistically have?
An evaluation of the prospects of success of an unfair dismissal claim depends on two main elements:
- Whether the employer has followed a fair procedure in dismissing the employee; and
- Whether the employer acted substantively fairly in dismissing the employee
As well as an analysis of these two elements, a competent unfair dismissal solicitor should be able to introduce alternative considerations such as whether the employee contributed towards their dismissal, whether they’ve mitigated their loss and whether their conduct has been reasonable (among others).
What’s a reasonable value for the employee’s potential unfair dismissal claim?
Once they have all the facts before them the employee’s unfair dismissal solicitor should be able to analyse these facts and determine what a reasonable valuation for a potential unfair dismissal claim is. This will involve an analysis of such factors as the length of service of the employee, their gross and net wage, what contractual benefits the employee was entitled to during their employment, and how long they expect the employee to remain unemployed for.
Read more: What should the best compromise agreement solicitors do for you?
How much is the employee being offered in the compromise agreement?
Once an analysis of potential reasonable compensation for the unfair dismissal claim has been conducted then the employee’s constructive dismissal solicitor should be able to carry out an accurate evaluation of whether what’s being offered in the compromise agreement is fair. It’s important in such circumstances for the employee to be reasonable about what they’re being offered in the compromise agreement – the median award for a successful unfair dismissal claim in the Employment Tribunal claim in 2010-11 was approximately £5,000 so employees can’t expect payouts of hundreds of thousands of pounds.
Is the termination of the contract of employment acrimonious or not?
This is an extremely important consideration. If the employee and the employer are both happy to end the employment relationship then it’s a fairly easy task to get the compromise agreement signed by both parties. However, if the parting of ways is acrimonious then there can be a prolonged and potentially aggressive period of negotiation before both sides are happy with the compromise agreement.
