Employment

Understanding settlement agreements

What to check before signing — and why independent legal advice is required, not optional.

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A settlement agreement is only legally binding if you've received independent legal advice on it — that's not a formality, it's a requirement for it to be enforceable.

It's worth understanding what you're giving up, and whether the figure on the table reflects your actual position.

What this covers

What a settlement agreement legally requires to be valid
Whether the compensation offered reflects your position
Restrictive covenants and references
Tax treatment of settlement payments

Many employers cover the cost of the independent legal advice required to sign — worth checking before you pay for it yourself.

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