CIPD welcomes settlement agreement proposals

As the Government publishes its response to the consultation on ending the employment relationship, the Chartered Institute of Personnel and Development (CIPD) has welcomed the Government’s decision to make it easier for small businesses to enter into settlement agreements with underperforming employees.

The Government has pledged to work with Acas to ensure that guidance for employers on the procedures to follow before entering a settlement agreement offers effective protection for good management practice and promotes positive relationships in the workplace.

Mike Emmott, employee relations adviser at the CIPD, commented:

“The CIPD has always supported the use of compromise (now “settlement”) agreements where both employer and employee agree that the relationship between them has reached the end of the road. 

“Settlement agreements can give both sides a way of terminating their relationship without the mutual recriminations that often accompany claims to an employment tribunal, and without exposing the employer to the risk of a subsequent claim. 

“We support the Government’s intention to make it easier for small employers to enter into settlement  agreements, and to give all employers more confidence to embark on the conversations needed to initiate such agreements.”