You have received a settlement agreement from your employer and you are wondering whether you can simply sign it. That is a sensible doubt: a settlement agreement has major consequences for your income, your benefits and your future. An employment lawyer in Eindhoven reviews the agreement from A to Z and identifies where the document falls short or where you may be able to negotiate a better deal.
What exactly is a settlement agreement?
A settlement agreement is a written arrangement by which an employer and employee mutually agree to end the employment relationship. No court is involved and no UWV procedure is required. That sounds straightforward, but the text of such a document is full of legal clauses that can have far-reaching consequences.
Because you are the one who bears those consequences, it is wise to have the agreement reviewed before you sign. You are legally entitled to three weeks’ cooling-off period after signing, but it is smarter to consult an expert before taking that step.
Which points does an employment lawyer check?
An employment lawyer does not merely check whether the figures add up; they assess the entire document for legal risks and missed opportunities. Below are the most critical elements.
The end date and the notice period
The agreed end date must align with the statutory or contractual notice period. If that period is not observed, the UWV may regard this as culpable dismissal and refuse or postpone your unemployment benefit. An employment lawyer checks whether the date has been calculated correctly.
The transition payment
Are you entitled to a transition payment, and has the amount been calculated correctly? The sum depends on your years of service and your gross monthly salary, including fixed allowances. Errors in the calculation are more common than you might think, and signing for a figure that is too low means you lose out on money.
The neutral ground for dismissal
For an unemployment benefit claim it is essential that the reason for dismissal cannot be attributed to you. The agreement must contain wording indicating that the initiative lay with the employer and that no blame attaches to you. An employment lawyer pays close attention to this passage.
The non-compete clause and the non-solicitation clause
Is there a non-compete clause or a non-solicitation clause in the agreement, or is reference made to your employment contract? If so, these clauses may still be in force after you leave. An employment lawyer assesses whether there is scope to have them waived or restricted, so that you are free to work for a competitor or client.
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Plan a conversationThe full and final settlement
Almost every settlement agreement concludes with a full and final settlement clause: the parties declare that they have no further claims against each other. That sounds neutral, but it means that any outstanding claims you may have — such as unpaid bonuses, overtime or a backdated pay rise — are relinquished. An employment lawyer checks that all your entitlements have been accounted for before you sign that release.
Practical tips before you sign
- Never sign immediately: always ask for time to consider and make genuine use of it.
- Gather your employment contract, payslips and any correspondence before visiting a lawyer.
- Make your own note of all outstanding entitlements, such as holiday days, bonuses or expense reimbursements.
- Ask your employer for a draft agreement in writing; a verbal agreement is not sufficient.
- Do not let yourself be pressured into deciding quickly: haste is almost never in your favour.
- Check whether any non-compete clause is explicitly released in the settlement agreement.
When is a settlement agreement acceptable and when is it not?
Not every settlement agreement is unfavourable. Sometimes a settlement agreement offers certainty and a clean conclusion to an employment relationship that is no longer working. However, there are also situations in which you are better off refusing the agreement or renegotiating — for example, if the compensation is too low, the end date falls too early or your benefit entitlements are at risk.
Whether a settlement agreement is sensible for your particular situation depends on many factors: your age, length of service, the reason for leaving and your plans for the future. You can read more about how to protect your rights in a conflict situation on the page Settlement agreement in a conflict: your rights and approach.
Why Labour Lawyer Eindhoven
At Arbeidsjurist Eindhoven we know the local labour market and we understand what is happening with employers in the Brabant region. We read your settlement agreement thoroughly, explain the consequences to you in plain language and give you concrete guidance on whether to negotiate or to refuse.
Have you received a settlement agreement and would you like to know whether it holds up? Get in touch with us without obligation. We will look at your situation together and make sure you are well informed when you sit down at the table.
Frequently asked questions
How quickly do I need to respond to a settlement agreement?
You are not obliged to respond immediately. Take the time to seek advice. You are legally entitled to three weeks’ cooling-off period after signing, but it is wiser to consult an employment lawyer before you sign.
What does it cost to have a settlement agreement reviewed?
Costs vary depending on the lawyer and the situation. Many employment lawyers charge a fixed fee for a settlement agreement review. Ask for clarity on costs in advance so that you are not caught off guard.
You will not lose your unemployment benefit if you sign a settlement agreement. However, you may have to repay any overpayment of unemployment benefit that has been made as a result of the settlement amount.
Not automatically. If the ground for dismissal is worded neutrally and the end date corresponds to the notice period, you can still be eligible for unemployment benefit. An employment lawyer checks whether the wording meets the UWV’s requirements.
We're happy to help you brainstorm ideas. For advice tailored to your specific situation, we'd be happy to sit down with you. No rights can be derived from the content of this page and it may contain inaccuracies.
