If you’re leaving your employment under a Settlement Agreement, you may be wondering what happens to the benefits you’ve built up during your employment.

Whilst the financial settlement itself is important, many employees are equally concerned about issues such as:

• Annual bonuses.
• Commission payments.
• Company cars.
• Private medical insurance.
• Pension contributions.
• Share schemes.
• Holiday entitlement.
• Other employee benefits.

The answer will depend on your contract of employment, your employer’s policies and the terms of the Settlement Agreement itself.

Understanding what you are entitled to before signing the agreement can make a significant difference to your overall financial position.

Bonus payments

If you normally receive an annual or performance-related bonus, one of the first questions to consider is whether you remain entitled to receive it.

This will depend on factors such as:

• The terms of your employment contract.
• The rules of any bonus scheme.
• Whether the bonus is contractual or discretionary.
• Your leaving date.
• The wording of the Settlement Agreement.

In some circumstances, bonus payments may form part of the negotiations between you and your employer.

Commission payments

Employees who earn commission often have additional concerns when their employment ends.

Questions commonly include:

• Will I receive commission on completed sales?
• What happens to work already in progress?
• Can commission still be paid after I leave?
• What if payment has not yet been received by my employer?

The answers will usually depend on your contract of employment, any commission scheme and the terms agreed within the Settlement Agreement.

Where commission forms a significant part of your earnings, it is important that this aspect of the agreement is reviewed carefully.

Holiday pay

If you have accrued annual leave that you have not yet taken, you may be entitled to receive payment for that leave when your employment ends.

Equally, if you have taken more holiday than you had accrued, there may be deductions depending on the terms of your contract.

Your Settlement Agreement should clearly explain how holiday entitlement has been calculated and whether any payment or deduction will be made.

Pension arrangements

Leaving your employment does not necessarily mean losing your pension benefits.

However, your Settlement Agreement may deal with issues such as:

• Employer pension contributions.
• Final pension payments.
• Salary sacrifice arrangements.
• Pension administration following the termination of employment.

If you have questions about your pension, your solicitor can explain how the Settlement Agreement deals with these issues and identify any points that require clarification.

Company car and other equipment

Many employees are provided with company property during their employment.

This may include:

• Company cars.
• Mobile phones.
• Laptops.
• Tablets.
• Security passes.
• Other equipment.

Your Settlement Agreement will normally specify when these items should be returned and whether any practical arrangements need to be made before your employment ends.

Private medical insurance and other benefits

Many employment packages include benefits in addition to salary.

These might include:

• Private medical insurance.
• Life assurance.
• Dental insurance.
• Gym memberships.
• Car allowances.
• Professional subscriptions.
• Employee discount schemes.

The Settlement Agreement should explain when these benefits will end and whether any arrangements have been made for them to continue for a limited period.

If these benefits are important to you, they may also form part of wider negotiations.

Share schemes and share options

If you participate in an employee share scheme or hold share options, the position can be more complex.

Your rights may depend on:

• The rules of the share scheme.
• Your contract of employment.
• The reason your employment is ending.
• The terms of the Settlement Agreement.

Because these arrangements vary considerably between employers, it is important to obtain advice before making assumptions about your entitlement.

Can these benefits be negotiated?

Sometimes.

Although employers are often focused on agreeing the financial settlement, other aspects of the package may also be capable of negotiation.

Depending upon your circumstances, discussions may include:

• Outstanding bonus payments.
• Commission.
• The timing of benefit cessation.
• Professional subscriptions.
• Retaining certain equipment.
• The return of company property.
• Practical arrangements that make the transition to new employment easier.

Every Settlement Agreement is different, and the opportunities for negotiation will depend on your legal position and your employer’s objectives.

How Pepperells can help

Our specialist Employment Solicitors will review every aspect of your Settlement Agreement—not just the headline compensation figure.

We’ll explain:

• What payments you are entitled to receive.
• How your benefits will be affected.
• Whether anything appears to have been overlooked.
• Whether improvements may be negotiated.
• Any practical issues you should consider before signing.

Our aim is to ensure you understand the full value of the package being offered and that your interests are fully protected before the agreement becomes legally binding.

Speak to a Specialist Solicitor

If you’re unsure what will happen to your bonus, commission, pension or employee benefits under your Settlement Agreement, Pepperells can help.

Our specialist Employment Solicitors will explain your agreement in clear, practical language and advise whether the package offered properly reflects your contractual and legal entitlements.

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