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Richard Lozano, Head of Employment at Taylor Bracewell, explains that a Settlement Agreement is a confidential contract between an employee and employer, often arising when the employment relationship has not worked out or in redundancy situations. The employer typically makes a without prejudice offer, which ensures confidentiality in case of future claims if the agreement fails. Employees are advised to seek independent legal advice, generally covered by the employer, to understand the terms of the agreement. A good advisor will assess whether the offer is reasonable, noting that employers sometimes offer only what the employee is legally entitled to under their contract.
