As an alternative to settling your claim through Acas, you can reach a private agreement with your employer known as a Settlement Agreement, under which your employer may agree to pay you compensation (and, for example, provide an agreed reference) as long as you withdraw your claim. You can use a Settlement Agreement to settle your dispute at any stage, whether or not a claim has been issued in the tribunal.
To be legally valid, a settlement agreement must meet some strict legal requirements. It must be signed by you, the employer and a person specified as having authority to sign settlement agreements. This will be a solicitor, a trade union officer or a Citizens Advice worker who has an appropriate certificate of indemnity insurance. Once you have signed a settlement agreement, you cannot pursue that claim any further.
Your employer is not allowed to use the Settlement Agreement to stop you making a protected disclosure to a regulator in the public interest. Whistleblowing law is very complicated. If you are concerned about this aspect of your Settlement Agreement, you should seek advice from specialist whistleblowing charity Protect (it used to be called Public Concern at Work).
You must not be asked to sign a settlement agreement that prevents you speaking out about harassment at work, including sexual harassment. The Equality and Human Rights Commission has produced guidance about this.
For some disputes, especially those where you are still in work, in-work mediation can be a better alternative than a tribunal claim. Acas and the TUC have produced a useful joint guide to mediation (PDF, 1.36MB) explaining when it is likely to be the best route to resolving a dispute. Acas is the TUC’s preferred in-work mediator.
In general, you should always take advice about which route is best for you in your particular circumstances. Your union or an advice agency, such as Citizens Advice, should be able to help.