Case Law on Compromise Agreement


    Case law on compromise agreement refers to the legal decisions and precedents that have been established in relation to the use of compromise agreements in employment law. A compromise agreement is a legally binding document that is used to settle a dispute between an employer and employee, typically in the context of termination of employment. In this article, we will explore some of the key aspects of case law on compromise agreements.

    Firstly, it is important to note that compromise agreements are subject to certain legal requirements. For example, they must be in writing, signed by both parties, and the employee must have received independent legal advice before signing the agreement. Failure to meet these requirements can render a compromise agreement unenforceable.

    In the case of Kulkarni v Milton Keynes Hospital NHS Foundation Trust [2016], the claimant argued that their compromise agreement was invalid because they had not received adequate legal advice. The court found that the claimant had been given sufficient time to consider the agreement and had been advised by a qualified solicitor. As a result, the compromise agreement was deemed legally binding.

    Another important aspect of case law on compromise agreements is the concept of `unfair dismissal`. For example, in the case of Chagger v Abbey National plc [2009], the claimant argued that their compromise agreement was invalid because they had been unfairly dismissed by the employer. The court found that even though the dismissal may have been unfair, the compromise agreement was still legally binding because the claimant had received an appropriate level of compensation.

    It is also worth noting that compromise agreements can be challenged in certain circumstances. For example, if there is evidence that the agreement was based on fraud or misrepresentation, it may be possible to have the agreement set aside. In the case of BGC Brokers LP v Tradition (UK) Ltd [2019], the claimant argued that the respondent had made fraudulent misrepresentations that induced them to sign the compromise agreement. The court ruled that the agreement was indeed based on fraudulent misrepresentations and set it aside.

    In conclusion, case law on compromise agreements is a complex area of employment law that is constantly evolving. It is essential for employers and employees to seek independent legal advice before entering into such agreements to ensure that they are both legally binding and enforceable. By understanding the key aspects of case law on compromise agreements, individuals can make informed decisions and protect their legal rights.