UK: Settlement Agreements During Ongoing Employment
Authors: Frances Ross, Ruth Bonino, Corinna Harris, and Sophie Jackson
In 2012 the claimant brought a grievance about various matters including the failure by his employer to transfer him to their disability plan. He subsequently entered into a settlement agreement which provided that he would be transferred to the disability plan and receive disability salary payments, and he waived the right to bring various specified claims (including for disability discrimination), whether or not they were or could be in the parties’ contemplation at the date of the agreement.
In 2022, he brought disability discrimination claims on the basis that he had not had any salary reviews or increased payments since transferring to the disability plan. The tribunal struck out the claims on the basis they were precluded by the settlement agreement.
The EAT concluded that the tribunal had been correct to strike out the claimant’s disability discrimination claims given that they fell within the terms of the settlement agreement.
Practical point
This decision clarifies that a future claims waiver may be enforceable where there is a continuing employment relationship. This is significant for employers, given that the prospect of new claims arising is higher where employment is continuing. That said, the facts of this case are unusual and specific; although he was still employed, the claimant was an “inactive” employee remaining in employment so he could receive benefits under his employer’s disability plan.
