Settlement Agreements – Legal English Lessons
It’s the perfect definition of a settlement. Both parties didn’t get what they wanted.
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Start here with …
… what is a Settlement Agreement?
Listening Activity
Writing Activity
Vocabulary
Check your Prepositions
Listening Activity
Area of Law: Employment Law
Listening Task: Complete all questions below
Timing: 8 minutes long
Why was the lawyer free to see Phillipa Young at such short notice?
What type of contract has Phillipa Young’s employer given her to sign?
What sum has been offered to Phillipa Young in the contract?
Which department of Station Hill Maintenance does Phillipa Young work in?
How many branches does Station Hill Maintenance have?
What formal punishment did Phillipa Young recieve for failing to tax 3 of her employer’s vehicles by the end of the month?
Why was it such a problem that an existing client of Phillipa Young’s employer recieved an email intended for a new client?
The lawyer names three grounds upon which Phillipa Young agrees not to sue her employer according to this contract. What are they?
What does the lawyer say specific performance means?
What do the words full and final mean in this situation?
Audio Transcripts
Listening 12
Lawyer: Hello, Miss Young. How are you today?
Miss Young: I’m fine, thanks. I want to thank you for seeing me at such short notice. Please just call me Phillipa.
Lawyer: Thank you. That’s OK. My diary was actually full for this week, but luckily another client cancelled at the last minute, so I was able to squeeze you in. Anyway, down to business. How can I help you?
Miss Young: I’ve got really bad problems at work. They’ve given me this document to sign and I’m not even sure what it is. In fact, I’m not sure whether I’ve been sacked or not. I only know I’m in trouble.
Lawyer: Oh dear. Let’s see what we can do. Let’s have a look at that document, shall we? Just bear with me while I have a glance at it. Well, I can see straight away that this is what’s called a Settlement Agreement, Phillipa. A Settlement Agreement is a contract, wherein two parties, in this case, you and your employer, agree not to sue each other and settle the dispute in another way, usually involving the payment of money. Yes, I can see here in Clause 15 that you employer offers to settle with you for £2000. Would you like to start at the beginning and tell me about the problems you’ve been having at work? You work for a company called Station Hill Maintenance Services, I see.
Miss Young: Yes, that’s right. I started working for them as soon as I left college. I’ve been there for around 2 years now. I do paperwork. My job is in the admin department. I answer emails, invoice clients and answer the phone. Stuff like that.
Lawyer: I see. And what does the company do? What’s the nature of the business?
Miss Young: We provide a national maintenance service to landlords. Our company has 40 branches throughout the UK. When a tenant in a rented property has a problem with say, the plumbing or the central heating, we go out and fix it. We then invoice the landlord directly for the services we’ve carried out.
Lawyer: And when did the first sign of trouble come with your employer?
Miss Young: A few months ago. It was my fault actually. We’ve got a fleet of 12 vehicles at our depot. Most of them are vans that our workmen use to get out to jobs. The road tax on 3 of the vehicles was due in February and it was on my list of admin jobs to get the documents together and tax those 3 vans by the end of the month. Unfortunately, I forgot to do it. It was only when a driver came into the office and said he couldn’t drive an untaxed van that I remembered.
Lawyer: I see. And I suppose that caused a great deal of short-term disruption for your employer?
Miss Young: To put it bluntly, he went mad. He screamed and shouted at me and at one point I thought he was going to hit me. He said I’d cost the business almost £1500 in vehicle hire for the day and additional insurance. I got hauled into his office, and in the end I got a formal written warning.
Lawyer: I see. So you were expected to be on your best behaviour for the foreseeable future. But I’m guessing, because of the Settlement Agreement I’m looking at, that something else went wrong?
Miss Young: I’m afraid so. Last week I was asked to check over an email from my boss containing a proposal for a potential new client, and then I had to forward it to the client once I’d checked it for typing mistakes or any other problems. It contained everything the client wanted to know about our charges and costs for providing maintenance services for his rented properties. But I was tired that morning. I should have sent the email to Alex Thompson, the new client but I accidentally sent it to Alan Thompson, an existing client. The existing client was able to see that we are charging new clients a much lower price for the same services.
Lawyer: Arghhhh! That’s quite a mistake, Phillippa. Especially for someone already on a written warning! What was the outcome of that conversation with your boss?
Miss Young: Well, I didn’t have one. They sent me home immediately and then that document arrived, with a letter asking me to sign and date it within 7 days.
Lawyer: I see. Well, I can’t say that I am entirely surprised. It something of a buyer’s market at the moment for employers with so many young people unemployed. Those who are in work or expected to be competent and not make this kind of error.
Miss Young: I know. I’ve been so tired at work because I’ve taken an extra job as a DJ 2 nights a week and I sometimes don’t get to bed until 2 in the morning. It’s my own fault, I suppose.
Lawyer: Well, let’s look at your options. Your employer hasn’t actually formally dismissed you at this stage. You’ve been offered a compromise agreement, and in return for the sum of €2000, you agree not to take your employer to court on the grounds of breach of contract, unfair dismissal or wrongful dismissal. They also say the sum compensates you for lost earnings. I see, as well, that they’re willing to pay you all holiday pay and outstanding expenses up to the termination date, which they give as the second of July. That seems reasonable to me. And given what you’ve told me, I’d advise you to take it.
Miss Young: What’s my alternative? I don’t really want to end up unemployed when there are so many people out of work. I’d rather keep the job, to be honest.
Lawyer: I’m afraid my opinion is that if you refuse this settlement agreement, the company will go ahead and dismiss you in any event. Then you’ll have the decision as to whether to go to tribunal or not, and if so, we’d have to prepare a case to say your dismissal was either wrongful or unfair. And I must warn you that a tribunal won’t give an order of specific performance, even if they decide there’s been a breach of contract on the part of your employer.
Miss Young: What does specific performance mean?
Lawyer: It means a judge ordering a party to a contract to do what it promised to do under the agreement. In this case, ordering your employer to continue to employ you. It just isn’t an option in employment law. Our best case scenario is damages, which would probably only amount to the offer you already have. No, I’d say this Compromise Agreement is a pretty good solution. But I must warn you that the words “full and final’ are very strictly applied by the courts.
Miss Young: Meaning that I can’t sue them in the future if I change my mind?
Lawyer: Meaning exactly that. I can’t choose what to do in this situation, Phillipa; I can only advise you and point you in what I think is the right direction. I suggest you sign this agreement, take your £2000, and learn an unfortunate lesson from it about burning the candle at both ends.
Miss Young: OK. I’ll sign it. Thank you for your help.
Lawyer: Just come back to me if any difficulty arises but it looks fairly straightforward to me.
Miss Young: OK, thanks. Goodbye.
Lawyer: You’re very welcome. Bye now.
Writing Activity
Area of Law: Settlement Agreement
Writing Task: A formal letter
Length: 400 – 600 words
Write a summary describing the lawyer’s meeting with Miss Young. Set out the main points mentioned in the interview and be sure that Fillippa has the proper advice to make her own decisions.
General Vocabulary
to squeeze in
a sum
to dismiss
full and final
damages
specific performance
just bear with me
to settle
to sue
to invoice / an invoice
a tenant
a landlord
breach of contract
a formal written warning
foreseeable future
to sign and date
wrongful
to sack / to fire
straight away
Check your prepositions.
Write
a number of
a sufficient number of
at this point in time
is able to
on a monthly basis
on the grounds that
an amount of X
be responsible for
in order to
Say
several, a few, or many
enough
now
can
monthly
because
X
must
to
Prepositions – In & At
In the case of place, these prepositions have the different meanings.
I am in the hospital. (You are getting treatment)
I am at the hospital. (You are visiting someone there)
You are in school. (You are studying)
You are at school. (You are eating lunch and playing basketball)
You are in the office. (You are working)
You are at the office. (You are “working” 😉
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About the Author
Eric Froiland
Eric is a legal English teacher from the United States and has been based out of Bogota, Colombia for the last 10 years. He is the owner and founder of Legal English Innovation SAS, which is recognized as the top legal English academy in Colombia and is an official Test of Legal English Skills (TOLES) examination center.
