Settlement agreement out of the blue but love my job and don’t want to go anywhere

[HR BLAH BLAH]

Really need some advice here please from you good people for a close family friend.

My friend is a Sales Director on £60k plus yearly bonus of around £5k. Director in name only working for a family firm has 5.5 years loyal service and it’s man and wife owned. No board structure and no internal hr as they sub it out to a 3rd party. Around 25 staff on the books been in business over 15 years. The industry is contract cleaning on a large scale working mostly for schools hospitals retail office blocks call centres and multi site clients across many regions etc. The contracts are renewed on a yearly system. The company turns over around £3 million per year.

My friend brings in around 70% per year of the turnover revenue creating new and keeping existing clients. Brilliant working relationship never had a cross word or a day off sick and absolutely loves the job and the staff. Forses far more than they should works above and beyond she is well liked and respected by all. Friendly family environment. Only thing to mention is the man and wife owners take massive directors loans out each year and cook receipts for their own financial purpose but that’s their prerogative and has never been an issue as they own the business and they know how to milk the system.

September 2024 all change. Outside account brought in to apparently tell the man and wife how to work more efficiently and increase profit margins (that’s the fake message given to the staff). Atmosphere changes immediately rumours run wild about it all being sold or maybe they’ve had their hands in the till too much. Staff start leaving or forced out on trumped up accusations and none of them get replaced the work is spread amongst the now overwhelmed and overworked staff. Promised pay rises and bonuses are all cancelled. Man and wife start trotting out excuses saying this is part of what they are being advised to do so basically using the hatchet man so called accountant advisor as the fall guy. Cost cutting goes beyond a joke such as accreditations being cancelled to save money no Christmas cards or presents for clients to the list goes on and on. Toxic working atmosphere is now across all staff who are all nervous and worried for their jobs and have witnessed the depths of lies and made up by the man and wife with false performance accusations to chop staff and save money without paying redundancy . September onwards when mr accountant comes in it gets more toxic each week.

Sales Director friend who is late forties and been in the same contract cleaning industry for over 30 years isn’t stupid or wet behind the ears, keeps head down carries on performing but can see through the lies and knows what the accountant hatchet man is up to.

second day back after Christmas sales director out of the blue is sent a PIP with immediate effect with lots of brand new things which were never in their original contract there stupid targets needs to make 40 virgin brand new client calls a day and 40 brand new virgin emails a day in addition to their normal job. No human could do these targets no consultation just given to them.

sales director worried sick for their family and mortgage goes away and seeks legal advice from his union. Union advises go into the office speak to man and wife and remind them about unblemished service does millions of pounds worth of business so why do they need training and to be put on new targets that no human can physically achieve all without consultation and comes out off the blue. More worrying is the PIP document says it will be reviewed for performance each Friday every week. Alarm bells are dinging like thunder claps.

they go back in for the chat and mentions to the man and wife they took a little advice on what a pip is they were confused really upset by it. Wife admits it’s not a pip and instead a strategy plan and the document was titled wrong. She loses her temper accusing the director of breaking trust because they took legal advice. Director calmly replies with respect I’m entitled to take any advice I wish as I am not a hr expert and worried that this was unannounced and out of the blue.

Director completes strategy plan for 2025 and sends it in to man and wife with agreement to be discussed day after in person. Day after arrives and straight away wife says without predjudice meeting we want to put on the table a settlement agreement and the reason being the director has broke HER trust for consulting their union on the pip. Director is gobsmacked and shocked and says they love the job and does not want to leave or go anywhere. Can we not just please have a conversation to discuss the wife’s trust issue and sort it out. Director is told that’s it the trust has gone and the wife is unhappy so to hand in the laptop and company phone and is sent home for ten days to get advice on the agreement.

agreement lands next day done by the 3rd party hr company usual 5 weeks pay notice full pay for next ten days. The golden goodbye is a little over 2.5 weeks worth of money £2900 which is an insult.

director is devastated and feels set up. Director consults union who say it’s an absolute joke.

To sum up Director wants to stay on working. They’ve being walked out on the cheap because the wife of the owner who comes in once a fortnight took a dislike to the director for taking a few moments of union advice on a document she apologised in writing for to the director for getting wrong. It wasn’t a PIP it is now a strategy plan for 2025 to improve business and profits. Director feels it’s just part of the chopping to get rid of staff on the overheads as the business is either being sold or they are cost cutting down to the wire.

Director has a wonderful job successful career can back their fantastic results with the millions of pounds they have brought in and continue to bring in.

So folks what does director do as they love their job ? Refuse the settlement which is an insult just 2.5 weeks or ask for the proper 6 months they should get ?

please help if you can with words of wisdom

[atticus]

You have not included some key information. What is your friend's contractual notice period? You suggest 6 months. And has he been with this employer 5 complete years or is it longer?

He would do well to get professional advice. Does he have legal expenses insurance?

[Manxman]

Why isn't he/she following their union's advice? They (the union) must be able to provide legal advice and representation - that's what your friend is paying them for, isn't it?

[HR BLAH BLAH]

Her notice period is a week for every completed year which is five years. So five weeks notice.

Thing is she does not want to leave at all and loves her job. Never had an issue and been a golden star employee then bang settlement agreement out of the blue and sent home for ten days as per acas. All for taking legal advice that the owner thought was a breach of trust as they were supposedly friends!

union advising five weeks notice plus 6 months salary to find a job of similar wages and role. Plus she has only ever worked in the cleaning industry for around 30 years.

they’ve offered under three weeks which is insulting

[atticus]

All the more reason to take good professional advice. Assistance in sabre rattling and negotiating is needed.

[HR BLAH BLAH]

thank you for your replies.

one major point the union has seen today buried in the SA. Termination date clock is ten days from when she was sent home to consider the SA and get legal advice.

The SA says she is bound by her restrictive convents agreement which says from termination of employment she cannot work whatsoever in any shape or form in the same industry relative industry’s for three whole months. So does that mean the present SA offering her less than 3 weeks pay off in addition to her 5 weeks notice becomes illegal and against workers rights ? Does this mean the SA has to be written again as she cannot work for three months anywhere?

how can 3 weeks SA offering compensate 3 months of handcuffs

[HR BLAH BLAH]

Further to the above she has had a good read of the restrictive covenants and there is more she has found. The SA says she is bound by her restrictive covenants and this is copied below and now mentions she cannot do anything for six months. She is now losing sleep over this she it’s affecting her mental state as she is worried sick for her and her family.

So the million dollar question if you good people is that she has been offered her 5 week notice for her 5 years service plus just under 3 weeks worth of pay as her golden handshake goodbye. Has her employer and their HR advisors made a huge mistake because in the SA they are legally telling her she needs to stick to the restrictive covenants. Basically does this mean the SA offer has to be a minimum of six months full pay. Otherwise she would be in severe financial hardship she had her partner and four children would lose their home. All of the below applies to her in her sales director role.

DEFINITIONS

"Restricted Business" shall mean any business or activity carried on by the Company at any time during the Relevant Period and in which the Employee shall have been directly concerned during the Relevant Period.

"Restricted Clients" shall mean any person, firm or Company or other organisation or entity who was at any time in the Relevant Period a Client of the Company.

"Prospective Clients" shall mean any person, firm, Company or other organisation or entity who at the date of termination of the Employee's employment with the Company was engaged in negotiation with the Company with a view to engaging the Company's services.

"Relevant Period" shall mean the six month period preceding the date of termination of the Employee's employment with the Company, ending on that date.

[HR BLAH BLAH]

And this is in the restrictive covenant stating six months.

A)Of Restricted Clients:

The Employee shall not, during the period of six months after the date of termination of their employment with the Company, directly or indirectly on their own account or on behalf of or in conjunction with any person, firm, company or other organisation or entity either:

a)conduct Restricted Business; or

b)canvass or solicit or by any other means seek to conduct Restricted Business;

with any Restricted Client whom the Employee shall have had material dealings in the course of their duties during the Relevant Period.

B)Of prospective Clients:

The Employee shall not during the period of six months after the date of termination of their employment with the Company, directly or indirectly on their own account or on behalf of or in conjunction with any person, firm, company or other organisation or entity either:

a)conduct Restricted Business; or

b)canvass or solicit or by any other means seek to conduct Restricted Business;

with any Prospective Client whom the Employee shall have had material dealings in the course of their duties during the Relevant Period.

[atticus]

I repeat that your friend needs professional advice! I ask again whether she has legal expenses insurance cover.

[HR BLAH BLAH]

She’s in the union and is contacting a local solicitor for a free 30 minute consultation before she replies turning down the three week offer.

[ULA]

So there are several things to point out here:

1. A union solicitor, in my opinion, will not be able to assist in negotiating a reasonable settlement agreement (SA).
2. Although your friend still seems to want to work there it is clear that her employer wants her to leave. In that atmosphere, I suggest she sets her mind to getting a reasonable settlement rather than try to stay in the job.
3. Part of the process of signing a SA is that your friend will be required to take independent legal advice from an employment law specialist. Part of their job is to ensure that the compensation being offered is at the correct level given the circumstances and the rights that they are giving up to not bring any further claims. If they do not feel what is being offered is enough compensation, then they will have to negotiate with the employer to increase the sum being offered.
4. I would certainly say that one of the things they can negotiate is that your friend should not be held to the terms of their restrictive covenants and that the agreement to not enforce needs to be a term of the settlement.
5. Most employment law solicitors have a standard payment for providing this advice which is between £500 and £750 which is generally the rate that the employer offers to pay. This is usually enough to cover the costs if the SA is straight forward and there is not much back and forth negotiating terms. If there are protracted negotiations, then the solicitor will be responsible for negotiating a larger fee contribution.
6. Another piece of advice, a good employment law solicitor should ask to see your friend's contract of employment.

[HR BLAH BLAH]

Thank you ULA that is exactly what she is doing. She’s booked in to see a proper solicitor specialising in employment law 30 mins and she wants the solicitor to reply to the SA not the union.

[ULA]

Good to hear and you know where we are if there are any further questions. Just come back to this thread.

[HR BLAH BLAH]

Thank you ULA

[HR BLAH BLAH]

Sorry folks need more advice please!

solicitor has advised her the SA contradicts itself snd is unfair and unjust because she was offered just 2.5 weeks of money. Buried within the SA is the restrictive covenant clause saying she cannot work anywhere in the uk for a minimum of three months. He believes the SA hasn’t been checked properly before it came across. She has 30 years or so experience only in this industry and nowhere else. Also there is no sum offered to pay her legal fees which could be around £400 or so.

* solicitor suggests counter offer of 4 months tax free pay plus her 5 week taxable notice pay and all accrued holiday pay
* solicitor suggests a sum of £500 to cover her legal costs

Do you good folks think the above is fair?

If her company says no that’s it offer is off the table does she say not a problem I will see you in the office the next day and she goes back to work as if nothing happened and does her job as normal.

solicitor says they are just trying to get rid of her as cheaply as possible and 5 weeks notice pay and a £2.9k golden goodbye of which she will pay £400 legal fees is an insult. Plus she needs to find a job within her industry of equal position and salary package. That could take many months and is not enough time to re train for another career path. She had to find a job of similar package.

please advise as she is now not sleeping or eating properly with anxiety and stress with all of this. She is not going to go anywhere unless she gets what the solicitor has recommended. If her employer turns down her counter offer does she simply say not a problem I look forward to seeing you all in the office tomorrow and she goes back to work as normal? The deadline for her to counter offer is before 5pm tomorrow.

Thank you for your advice