A Settlement Agreement Guide for Board Level Senior Executives  

We are proud of the reputation we have established, nationally, for advising board level senior executives entering or exiting roles.  

We’re often contacted when individuals feel that they’re in the eye of the storm – they’ve had very successful careers and being asked to have a conversation about exiting the business feels well outside their comfort zone.  In that situation, we don’t take the role of simply advising on the terms of the proposed agreement, we take time to build confidence and trust by talking about the situation they find themselves in and to understand what the ‘best’ outcome might be for them.  

Often finances and benefit packages are a high priority, but we also encourage our clients to think about what will serve them best in terms of their future career prospects, industry connections and professional reputations, as well as their own personal and family circumstances.   

We work quickly to devise a holistic plan, avoiding jargon, to put them in the best possible decision. We decide, tactically, whether they or we are best placed to have the conversations which are most likely to achieve the outcome they’re seeking. 

We’re knowledgeable about the detailed terms of settlement agreements and able to advise on what wording is appropriate.  Whilst the basic terms of a settlement agreement can be fairly standard – including a waiver of rights to bring most employment related claims, maintain confidentiality and dealing with the practicalities around the end of employment and handover – the terms in an agreement for a senior employee are often more complex.   

If you find yourself in this situation, here are some of the key things to consider: 

Financial terms :

Maximising cash if often useful, but we can make sure that payments are structured and timed in a way to be tax efficient, including considering whether payments are made into a pension.  We’ll also make sure that your contractual rights to bonus, commission or other sums are considered.  

Existing agreements: 

It’s useful for us to know what’s already in place so we’ll often ask for copies of service agreements/employment contracts to check your salary and benefit terms including incentive arrangements, notice entitlement, confidentiality and wider obligations on termination. 

Restrictions:

If you don’t already have them in place, or if they’re not as tight as they should be, your employer may want you to sign up to new restrictions on where you can work, and who with, after your employment with them has ended.  If moving on unrestricted is important to you, we can factor this into our negotiations – although it can still be useful to think about whether you need to be free of all restrictions or whether some are unlikely to make a difference to your future plans. 

Confidentiality:

Agreeing to go quickly and quietly can often be valuable leverage in discussions with your employer.  You’ll often be asked to agree to keep confidential information which you learned during your employment, although there are certain exceptions which would allow you to raise whistleblowing, regulatory or criminal concerns even after the Settlement Agreement had been signed. 

Benefits:

Different things are important to different people, but we can seek to negotiate things like retention of benefits (such as private healthcare, personal use of the mobile phone or car) for an agreed period or for company property to be transferred to you when your employment ends. 

Shares and share options:

You may wish to keep your shares and/or share options, although it’s fairly common for them to be transferred at the time you leave.  We can advise on what you and the Company may be obliged to do with your shares and options, including under any relevant shareholders’ agreement or the company’s articles which may define whether you can be treated as a ‘good’ or ‘bad’ leaver. 

Directorships:

If you’re a statutory director, it’s common to resign from these positions at the same time as resigning your employment.  You may wish to relinquish these duties as soon as the Settlement Agreement is signed, or be happy to stay on whilst working a period of handover and/or garden leave. 

Agreeing the party line: 

It’s common for internal announcements, external statements and press releases to be incorporated into a Settlement Agreement.  We can talk through what to include to give you most flexibility – and also how to deal with searching questions from interested parties. 

If you’re ready to chat to a member of our team about how to bring all of these factors together to best suit your situation, please do contact us at info@torquelaw.co.uk or on 01904 437684.

Torque Law are on the Times Best Law Firms 2025 list, are ranked Band 1 by Chambers & Partners, have achieved a 5 Star Client Satisfaction rating by the Legal500, and are Niche Law Firm of the Year 2024. We are a safe pair of hands to support you through the Settlement Agreement Process.