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Settlement agreements: future claims

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Summary: EAT follows Bathgate – future claims settled by compromise agreement.

In Clifford v IBM, the Employment Appeal Tribunal held that the tribunal had been correct to strike-out the Claimant’s claim of disability discrimination. It had been validly settled by a prior compromise agreement. 

The Claimant was absent from work owing to disability from 2008 onwards. In 2013, he entered into a compromise agreement under which the Respondent agreed to place him on its disability plan. The plan gave the Claimant disability salary payments. Increases under the plan were discretionary.

Under the terms of the compromise, the Claimant waived the right to bring various specified claims, including disability discrimination claims, whether or not they were or could be in the contemplation of the parties at the date of the agreement. An exception in respect of future claims did not apply to matters arising from the Claimant’s transfer to the plan.

The Claimant brought a claim of disability discrimination on the basis that payments had never increased under the plan. The tribunal struck-out his claim. It was a future claim but was clearly barred by the terms of the compromise agreement. It made no difference that the Claimant remained in employment.

This case is one of the first examples of the Court of Session’s decision in Bathgate v Technip being followed by the EAT. It is also a reminder of the importance of clearly wording any waiver of future claims in a settlement agreement.