What is a settlement agreement protocol?

[tanjimajuha20]

Termination of an employment contract is often the subject of disagreement between the employer and the employee, which may be brought before the Industrial Tribunal. In the interest of both parties, a settlement agreement may be negotiated to end the dispute and avoid legal action. However, it must comply with certain conditions of validity. What are the terms of a settlement agreement, in which cases can it apply? The drafting of a settlement agreement protocol is not trivial, it must include certain concessions and mentions to protect each of the parties.


According to Article 2044 of the Civil Code, a transaction philippines phone data is a contract by which the parties put an end to a dispute or which allows a future dispute to be avoided. The termination of an employment contract is often the subject of litigation: the employer may accuse his employee of having committed errors or negligence, while the latter may highlight a flaw in the dismissal process or contest the validity of the reason. Rather than initiating proceedings before the Industrial Tribunal, which are long and costly, and have an uncertain outcome, the two parties often prefer to negotiate a settlement agreement, which allows the employee to quickly recover a sum of money. The settlement agreement is an alternative method of dispute resolution . On the basis of a lawful dispute, direct negotiations take place between the employee and the employer or via their respective counsel. At the end of the negotiations between the two parties, a settlement agreement protocol is drawn up, establishing the reciprocal commitments, and signed by both parties.

What is the point of signing a settlement agreement?
It allows to definitively end the dispute existing between the employer and the employee. It can occur after a resignation, a dismissal or a mutual termination. This amicable conciliation avoids the employer having to take legal action and grants financial compensation to the employee. The interest can also be psychological for the employee: a settlement agreement allows him to quickly end the relationship with his employer to start looking for a new job. For its part, a procedure before the industrial tribunal can tarnish the reputation of the company and turn out to be bad publicity in terms of internal communication for the employer, in the event of flaws in the dismissal file.

The effects of the transaction
The transaction is not a method of terminating the employment contract, it is thus distinguished from the conventional termination based on a mutual agreement between the employer and the employee. It allows to settle the financial consequences of all methods of terminating the employment contract : resignation, dismissal, retirement. In the majority of cases, it occurs after a dismissal. In the context of a transactional dismissal, the employer must first respect the terms of the dismissal procedure: summons to the preliminary interview, interview then written notification of the dismissal, before negotiating a transaction. An approach aimed at terminating the contract and compromising at the same time is null and void.

The Court of Cassation recognizes the validity of a transaction signed after a mutual termination agreement, when the dispute concerns the execution of the contract and elements outside the termination agreement.

When does the settlement agreement occur?
The settlement agreement or settlement agreement protocol may be reached before the referral to a court, to settle disputes related to the termination of the employment contract or after the referral to the courts. Sometimes the law firm recommends an amicable conciliation , when there are deficiencies in the dismissal file. A dismissal for misconduct, contested by the employee, who has initiated proceedings with the Industrial Tribunal, may be the subject of a settlement agreement.

Situations where to write a settlement agreement protocol
The drafting of a settlement agreement protocol is conceived in labor law, and can be interesting in many sectors and in very varied situations:

In labor law: following a breach of contract between the employer and his employee to avoid proceedings before the industrial tribunal.

In the commercial context: to avoid referral to the commercial court in the event of a conflict between a distributor and its supplier.

In rental matters: when the owner of a dwelling notices damage attributable to the tenant and does not wish to take legal action.

In intellectual property law: for a company having infringed a competitor's trademark which wishes to avoid infringement proceedings before the courts.

This type of agreement saves time and money . The parties agree on an optimal solution to end the conflict, after negotiations, often with the assistance of a