Deeds and Mis-Deeds. Should I sign or not?
When settling industrial matters without a formal arbitrated outcome, the parties will often agree on some terms and conditions to settle the matter. Those terms and conditions are usually reduced to writing in a legally binding “Deed of Settlement” which, when drafted by the employer’s lawyers, are often overblown with legal verbosity which takes careful unpicking to determine the true impact.
Members being represented in employment entitlement or other disputes by the IEU will receive support, advocacy and advice along the way, including over the wording of any resulting deed. If a member has embarked on their own dispute without support they may be presented with a Deed to sign.
Do not sign anything without seeking advice. Deeds are legally binding and will generally extinguish your rights to further courses of action and/or make onerous or unnecessary demands. There is no such thing as a “standard deed”. Every deed should be crafted to suit the resolution of the specific situation. Deeds are as negotiable as the resolution itself.
Deeds tend to have common elements but there is no compulsory structure or wording. The only requirement is there must be some “valuable consideration” made in exchange for some action (or inaction).
Title page is followed by
Parties – identify the employer and employee
Recitals – explain the situation being resolved. Generally the employer will like to deny any fault or liability.
Settlement details –Details the “valuable consideration” (generally) made by the employer to the employee. This may necessarily be quite complex.
Release & discharge – The action promised in return for the “valuable consideration”. For example to not make any claim for unfair dismissal or underpayment. The employer will try to make this as broad as possible. It need not cover every possible claim (particularly if employment is continuing). It should cover only claims relating to the disputed matter. This should be even-handed in that it should also extinguish any employer claims against the employee. This section is generally over-blown. Some claims such as Workers Compensation and Superannuation cannot be extinguished by a deed.
Adverse Comments – Generally employers like to have a commitment that neither party will make disparaging comments about the other. This should be even-handed and may include a nominated person and/or words to be used in case of a departing employee seeking a referee check.
Confidentiality – As much as most simple situations are not interesting enough to talk about, employers are quite sensitive about details of settlements being known in the community or even the fact that there was a settlement.
Warrantees – confirmation that the parties have taken advice and are only relying on the deed terms.
Costs – Normally the parties pay their own costs.
Counterparts – separate copies of the deed may be signed by different parties.
Governing Law – the jurisdiction that would hear disputes eg about non-observance of the terms by either party.
Signature page for parties & witnesses
The biggest problem with employer-drafted deeds is that of over-reach. It is common for the first drafts to be far too broad in the protections granted to the employer and for the restrictions placed on the employee being more onerous than those placed on the employer.
Sign in haste and repent at leisure.