Can My Employer Change a Settlement Agreement After Offering It?

If you have been offered a settlement agreement, you may be wondering whether your employer can change the terms after it has been presented. In the UK, a settlement agreement is only legally binding if it meets specific statutory requirements, including that it is signed by both parties and that you have received independent legal advice. Until those requirements are satisfied, the document is not binding. In practical terms, this means an employer is entitled to amend the terms of a proposed agreement or withdraw the offer altogether before it is finalised.

Why might a settlement agreement be changed?

Employers may amend a proposed settlement agreement for a number of reasons. This may reflect internal approval processes, new information, or ongoing negotiations. Changes are commonly made following input from the employee’s solicitor, particularly where clauses require clarification or improvement. A settlement agreement should be viewed as a negotiated outcome rather than a fixed offer, and revisions are a normal part of that process.

What should you do if the terms change?

If your employer revises a proposed agreement, you should review the updated terms carefully. You are not obliged to accept the revised terms, and you remain entitled to take independent legal advice before signing. It is important to assess whether any changes affect the overall value of the package or introduce additional obligations, such as restrictive covenants or confidentiality provisions. If the revisions are not acceptable, further negotiation may be appropriate.

Why legal advice is important before signing

A settlement agreement becomes legally binding only once the statutory conditions are met, including receipt of independent legal advice. It is therefore essential to understand the final version before signing. A solicitor can explain the effect of the terms, identify any risks, and negotiate amendments where appropriate. This ensures that you enter into the agreement on an informed basis and with a clear understanding of its consequences.

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