Getting a Job After a Settlement Agreement

A settlement agreement is a legal document designed to bring a formal end to your employment relationship, but it isn’t a barrier to your career progression. Getting a job after a settlement agreement shouldn’t be an issue, provided you understand the steps you need to take.

Understanding your settlement agreement

A settlement agreement usually involves the employee waiving their right to bring certain claims against the employer, such as unfair dismissal or discrimination, in exchange for a payment or other benefits. In order for the agreement to be legally valid, you must receive independent legal advice on its terms, at a cost that is usually covered by your employer. To fully understand what a settlement agreement is and your rights take a look at our handy guide.

The clauses it contains are crucial to understanding its implications for getting a job after a settlement agreement.

Common legal considerations

Some of the most common elements to be considered when starting your job search are:

References

One of the most significant aspects of getting a job after a settlement agreement relates to the reference clause. Most agreements will include an ‘agreed reference’ or a ‘basic reference’ clause.

Agreed reference

This means your former employer agrees to provide a specific, pre-written reference to any prospective employer. This is a vital protection for your career, as it will prevent your former employer from giving a negative or misleading reference.

Basic reference

In some cases, only a basic reference will be provided. Typically this only confirms the date of employment and your job title.

No reference

Occasionally, a settlement agreement will state that no reference will be given at all.

Before signing any settlement agreement it is vital the reference clause is clear and agreed upon. This will give you certainty about what a future employer will receive in the way of a reference, and give you some peace of mind for getting a job after a settlement agreement. If your departure was far from amicable this clause becomes even more important.

Non-disclosure agreements (NDAs) or confidentiality clauses

Settlement agreements normally always contain non-disclosure agreements (NDAs) or confidentiality clauses. These legally oblige you to keep certain information confidential, but there are some types of information that are not included.

What is covered?

Sensitive company information, trade secrets, client lists, internal policies and often the terms and existence of the settlement agreement itself.

What is not covered?

Crucially, an NDA can’t prevent you from making a ‘protected disclosure’. Commonly known as whistleblowing, you can speak to relevant authorities (like the Health and Safety Executive or the Financial Conduct Authority) about any genuine concerns you have over wrongdoings at the company.

An NDA also can’t stop you from discussing your employment in general. It only covers the specific confidential information as defined in the agreement.

A good NDA won’t hinder your ability to discuss your skills, experience or job duties honestly, when it comes to getting a job after a settlement agreement. But it is vital to know what you can and can’t say to a future employer or at an interview.

Restrictive covenants

Some settlement agreements may include restrictive covenants, such as a non-compete clause. The aim of this is to prevent you from working for a competitor, or poaching former clients or colleagues. It usually relates to a specified period and geographical area.

If your settlement agreement has such a clause it may limit your immediate job opportunities within your sector. But, these clauses must be reasonable in order to be enforceable – such as for a limited time, scope or geography. An overly-broad non-compete clause may not be legally binding. If your settlement agreement contains restrictive covenants, it is vital to get expert legal advice to fully understand how they can be enforced and how they may impact on your job hunt. An expert can also help you assess if they are reasonable and how to proceed in the signing of a settlement agreement.

The settlement agreement and job interviews

The thought of having to disclose a settlement agreement to a prospective employer is a difficult one, but it is possible to do so while still making a positive impression.

Unless you are directly asked about the circumstances of your departure from a previous role, or if a non-compete clause makes it relevant, you are not generally required to volunteer information about a settlement agreement.

When asked about a previous role it is perfectly acceptable to keep your explanation brief and professional. You should focus on what you want in your next role and why you’re excited at the prospect of working with them. Keep it positive and forward-looking.

Don’t be tempted to speak poorly of a former employer as this only reflects negatively on you. And do make sure that any explanation you offer is consistent across both your interview and your application materials.

What rights do you retain following a settlement agreement

You still retain important rights that are important when it comes to getting a job after a settlement agreement. For example, you still have:

The right to seek new employment:

This is fundamental. The purpose of a settlement agreement is not to stop you permanently from working. Neither should it make it impossible to find a new role.

Whistleblowing protection:

As covered above, NDAs can’t be used to prevent you from protected disclosures to appropriate bodies.

Post-employment rights:

Even with a settlement agreement you still retain rights regarding your pension, data privacy (under GDPR) and other statutory rights not waived by the agreement.

Right to challenge new discrimination:

A settlement agreement covers past claims. It doesn’t prevent you from bringing claims for discrimination or other unlawful acts that might occur in a new employment context.

Moving on from a settlement agreement

It’s natural to feel apprehensive about getting a job after a settlement agreement. But, you can view the agreement as a clean break, allowing you the opportunity to move forward without the burden of potential past disputes.

How Kew Law can support you

Navigating a settlement agreement in the context of a job search can be complex. But, that’s where our specialist employment law solicitors at Kew Law can provide invaluable support.

We can thoroughly review your settlement agreement before you sign, explaining every clause in clear, easy to understand language to ensure you know what you’re signing. We will ensure the terms regarding references, NDAs and any restrictive covenants are fair and reasonable, protecting your future employability and your chances of getting a job after a settlement agreement.

Finally, we can help deliver the clarity and confidence needed to move forwards following a settlement agreement to ensure it doesn’t hold you back. You will know you have all the knowledge needed for a positive and successful transition.