Your legal rights and protections

You can waive specific, identified claims up to the date you sign, but some rights, such as accrued pensions or unknown future personal injury, can’t be signed away. A typical waiver covers claims like unfair dismissal, redundancy, breach of contract, discrimination, whistleblowing, and other employment-related disputes.

Some agreements also try to go wider, covering non-employment matters such as defamation, personal injury, or data protection breaches. But there are limits to what you can legally waive.

A settlement agreement can cover a wide range of potential claims, but not everything. To be enforceable, it must identify the categories of claim being settled, usually listed in a schedule that cites the relevant legislation (for example, the Employment Rights Act 1996 (ERA 1996), the Equality Act 2010 (EqA 2010), or the Working Time Regulations 1998 (WTR 1998)).

Rights that generally can’t be waived

Some rights are off-limits, even if they appear in the schedule. These include:

• accrued pension rights protected by section 91 of the Pensions Act 1995

• personal injury claims you don’t yet know about when signing

• the right to make future protected disclosures under the Public Interest Disclosure Act 1998 (whistleblowing)

• the right to enforce the settlement agreement itself

Even if an employer lists them among the waived claims, those rights normally remain enforceable. Parliament treats them as matters of wider public interest that can’t simply be traded away, and the courts will disregard any attempt to do so.

So why can’t you waive everything, lock, stock and barrel? Settlement agreements sit at the crossroads of private contract and public policy. The law generally lets two parties strike a bargain, but not at any price. Employment law recognises that employees usually have less bargaining power, so it builds in safeguards, such as the requirement for independent legal advice, to make sure any waiver of rights is informed and voluntary. Some rights, though, are off-limits. Parliament has decided they serve a wider purpose and can’t be traded away, and the courts will step in if an agreement goes too far, particularly when it tries to cover future claims that haven’t yet arisen.

Unknown existing claims

You can waive claims that already exist at the date of signing even if you don’t yet know about them, provided the agreement clearly identifies the category and subject matter of those claims.

This was confirmed in Arvunescu v Quick Release (Automotive) Ltd [2022] EWCA Civ 1600, where the Court of Appeal decided that a later victimisation claim was barred by an earlier COT3 settlement. The wording in that agreement was broad enough to cover all claims arising directly or indirectly from the employment. In Clifford v IBM United Kingdom Ltd [2024] EAT 90, the Employment Appeal Tribunal reached the same conclusion for a statutory settlement agreement. We’ll explain what a COT3 settlement is later in this guide.

Future claims

Courts are especially cautious about attempts to waive claims that haven’t even arisen yet. A future claim means something that arises only after you’ve signed the agreement, for example, if your employer were to discriminate against you later.

You can only waive a future claim if:

• the type of claim is clearly identified (for example, disability discrimination)

• the wording makes it plain that it covers future conduct; and

• you’ve had independent legal advice

These waivers are still uncommon and closely scrutinised. But since Bathgate v Technip UK Ltd [2023] CSIH 48, a Scottish appeal case influential across the UK, the position is clearer: a future statutory claim can be validly waived if the clause precisely identifies the type of claim and uses explicit language. Although Bathgate isn’t binding in England or Wales, it’s widely treated as persuasive authority, and the later English case of Clifford v IBM United Kingdom Ltd [2024] EAT 90 echoed its approach, confirming that only clearly drafted and properly advised waivers will be enforceable.

A blanket “all future claims” clause remains unlikely to hold up — and good advisers (ahem… Settlement Advice 4U) will always push back against it.

Personal injury

You can compromise known personal injury (PI) claims, such as those arising from a workplace accident, if they’re clearly identified. But you can’t waive claims for injuries that haven’t yet happened or that you don’t yet know about.
The law protects employees here, particularly through section 2 of the Unfair Contract Terms Act 1977, which prevents any contract term from excluding or restricting liability for death or personal injury resulting from negligence. In any event, agreements usually include a standard carve-out preserving unknown PI claims.