Redundancy confirmation (with settlement agreement) letter templateReading time 2 minutes (inc. support info). Reviewed 01/03/2023.
If redundancy is confirmed and you wish to include unfair dismissal claim protection, send this model letter to the employee to propose a settlement agreement.
This letter is issued in conjunction with the Settlement Agreement template.
What is a Redundancy confirmation (with settlement agreement) letter?
A redundancy confirmation (with settlement agreement) letter is used to confirm an employee's redundancy and to offer a settlement agreement.
A settlement agreement is a legally binding agreement between an employer and an employee that sets out the terms of a settlement between them, often in exchange for the employee agreeing not to pursue any legal claims against the employer. Settlement agreements are commonly used in redundancy situations as a way to ensure a clean break between the employer and employee.
The redundancy confirmation (with settlement agreement) letter typically includes details of the redundancy, such as the date on which it will take effect, the employee's entitlements, and any redundancy payment that will be made. The letter will also outline the terms of the proposed settlement agreement, such as any financial compensation that will be offered, any restrictive covenants that the employee will be required to abide by, and any other terms and conditions that will apply.
The purpose of the redundancy confirmation (with settlement agreement) letter is to formally confirm the redundancy to the employee, and to offer them the opportunity to enter into a settlement agreement. The letter will typically set out a deadline by which the employee must respond to the offer, and will also include information about the employee's right to seek independent legal advice before signing the settlement agreement. Once the settlement agreement is signed, it becomes a legally binding contract between the employer and employee.
Redundancy confirmation (with settlement agreement) [Delete this line]
Dear [Recipient first name],
It is with regret that I write to inform you that the Company (the Company) has decided to make you redundant with effect from [date]. You are aware of and we have discussed the reasons for your redundancy. We have tried to find you a suitable position commensurate with your abilities elsewhere within the Company but there is nothing available.
The Company has however decided to make you an ex gratia payment of £[amount] as compensation for the termination of your employment. In addition, the Company will make you a statutory redundancy payment of £[amount].
The statutory redundancy payment is calculated in accordance with your age, salary (subject to a statutory maximum of £[amount] per week) and the number of years service with the Company.
- The Company will therefore pay you a total sum of £[amount] payable immediately on your return of the enclosed Settlement Agremeent.
- You agree to refrain from initiating any proceedings before an Employment Tribunal alleging that the Company has dismissed you unfairly, discriminated against you on the grounds of race, sex or disability or has made an unlawful deduction from your wages, and to withdraw any such proceedings now in progress.
- You accept that this payment made by the Company is in full and final settlement of all claims of any kind which you are or might be entitled to make against the Company, its officers, shareholders or employees in connection with your employment or its termination including any claims which are now proceeding before an Employment Tribunal.
- You will return all property in your possession belonging to the Company on or before [date].
- You agree to pay any tax due in respect of the sums referred to above or to reimburse the Company for any tax the Company is required to pay in respect of such sums.
- You agree to keep the terms of this agreement confidential.
- You will receive a standard company reference confirming your service with the Company, and the quality of your work.
Please signify your acceptance by signing and returning the enclosed Settlement Agreement once you have sought appropriate legal advice.
Yours [faithfully | sincerely],
[Sender job title]
Final individual redundancy consultation meeting invitation letter template
If you need to conclude consultation with a provisionally selected employee, send this model redundancy consultation final meeting invitation letter template.
Settlement agreement template
If you wish to terminate an employee and gain there agreement not to pursue any claims in a Tribunal, issue this settlement agreement.
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