An employee entered into a settlement agreement with his employer in which he waived the right to bring various specified claims (including for disability discrimination). He then brought disability discrimination claims against his employer. At the time the employee entered into the settlement agreement the grounds for the claims were unknown to the parties and were not in contemplation.
The employment tribunal struck out his claims on the basis that the settlement agreement prevented the employee from bringing the claim and the claims had no reasonable prospects of success.
On appeal, the Employment Appeal Tribunal held that tribunal had correctly applied the relevant caselaw in concluding that the settlement agreement precluded the disability discrimination claims. Section 147 of the Equality Act 2010 permits a settlement agreement to be used to settle unknown future claims. This is provided that the types of claims are clearly identified in the settlement agreement and that clear wording is used to settle the particular type of claim. This legal requirement does not mean that the claim or employee complaint must have been known or its grounds at least in existence at the time of the agreement. The only requirement is that the terms of the agreement settle the particular complaint or claim being made by the employee or ex-employee.
This case underscores the need for clear legal drafting when entering into a settlement agreement with an employee or ex-employee, to ensure that it prevents them from bringing future claims.