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Settlement Agreements

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Can a settlement agreement compromise a discrimination claim that has not yet arisen?

No, held the EAT in Bathgate v Technip UK Ltd and others.

The Claimant had accepted voluntary redundancy that was formalised in a settlement agreement with advice from a solicitor. Part of the agreement was to compromise future claims against Bathgate in exchange for what was described as the 'Additional Payment for people under the age of 61.

The Claimant was over 61 and he refused the Additional Payment after the settlement agreement was signed. He sued for age discrimination. Lord Summers decided:

"[Mr Bathgate] signed away his right to sue for age discrimination before he knew whether he had a claim or not. While that may be possible at common law, the [Equality] Act restricts parties’ ability to do so....[T]he inclusion of a claim in a [settlement] agreement defined merely by reference to its legal character or its section number does not satisfy the language of [the Equality Act]. The words “the particular complaint” suggest that Parliament anticipated the existence of an actual complaint or circumstances where the grounds for a complaint existed. I do not consider that the words “the particular complaint” are apt to describe a potential future complaint."

Thanks to Matthew Jackson of Albion Chambers for preparing this case summary.