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Compromise Agreements on The Rise

Compromise Agreements on The Rise

The role of compromise agreements in appeasing conflicts and disputes resulting from redundancies is on the rise, as businesses are increasingly using them as a tool with which to resolve redundancy situations. Given the present state of the economy and wide scale cuts in the public sector along with stagnant growth in the private sector, redundancies are becoming more and more common. Many HR practitioners are seeing compromise agreements as their preferred solution to the majority of disputes that arise.

A recent survey into the increased prevalence of compromise agreements canvassed HR professionals in 101 of the UK’s leading organisations, to find out more about how compromise agreements are viewed by those that use them.

The statistics found that 82% of the HR practitioners who responded to the survey were in favour of using compromise agreements rather than contesting the case at an employment tribunal. The reasons given for this preference were the fact that over three quarters of the respondents were worried about the escalatory costs of many employment tribunals, whilst 63 per cent would rather not drag the company name through the courts and risk damaging its reputation.

One of the main concerns …