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I have been made redundant in a big Investment Bank in London. Being not a native from the UK I am new to the process and have nobody to ask advice for. The HR told me that I would need to contact lawyers for them to review the documents given by HR. At the end of it they suggest two lawyers firms they are used to work with from what they told me. They also say that they will reimburse up to 500£ in lawyers' fees. From my prospective, it looks a bit suspicious that they give me the name of these two lawyers firms. Maybe people with more experience could advice on whether it is common practice to suggest lawyers or not and therefore what I should do. Thank you for your help.

Sophie.

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    Their suggestion is only a suggestion. Surely if you're not comfortable with the lawyers they recommend, you are free to find a different firm. – Nate Eldredge Mar 22 '16 at 17:25
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    You have no reason to trust the HR department and probably a few reasons not to trust them. – jqning Mar 23 '16 at 3:26
  • That's what I think but then I don't know which lawyer's firm to contact. – user4867 Mar 23 '16 at 20:55
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This is an increasingly common practice in the UK for dismissals, especially for reasons of redundancy.

What is going on here is that they are attempting to enter into what until recently was known as a compromise agreement, and is now termed settlement agreement.

Normally, when you are made redundant, you are entitled to statutory redundancy pay (amount depends on age and length of service; see https://www.gov.uk/redundant-your-rights/redundancy-pay). You can take this and do not need to sign anything.

However, sometimes companies make slightly more generous offers in exchange for you agreeing not to take them to tribunal/court or discuss/disclose certain matters. This would often involve more money and an agreed reference. These agreements only have legal standing if you have taken legal advice from a person qualified to give it. The UK's national conciliation and arbitration service ACAS has information on settlement agreements at http://www.acas.org.uk/index.aspx?articleid=4395

Therefore the employer is offering to pay legal fees because they need you to get advice before you sign a document which protects them. They are suggesting solicitors because they know of solicitors willing to do this work for the price they are willing to pay.

Some companies will do this for every dismissal and have a have a standard package for enhanced redundancy. Other companies decide for each case.

Before you proceed to arrange a solicitor, you should check:

  • That you are free to choose another solicitor who will do the same for £500.
  • That this will be paid whether or not you agree to the terms.
  • What your length of service is, what your statutory entitlement is and what the difference is between that and what you are being offered.

You should also think carefully about whether you have any potential claims against the employer - for instance, if you think you are not being made redundant because the employer is doing less of a particular type of work but because you have raised issues of discrimination. You are probably being asked to give up your right to pursue this.

In terms of choice of solicitor, a solicitor which gets work from employer recommendations probably won't be too forthright in encouraging you to challenge unfavourable terms (even if they do not work for employers). If you are a member of a trade union, they will be able to suggest lawyers who do settlement agreements for employees on a regular basis. If not (and I assume not as otherwise they would be helping you through this), I would suggest finding a firm that specialises in representing employees - some solicitors' firms like Thompsons and Morrish are pretty open about their focus.

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The lawyers must be able to show to the regulator that they have advised you correctly as you are their client. The lawyer will have insurance that will pay out if you can prove the advice was not “reasonable”. (I am not using the word “correct”, as a judge may later decide the law has a different meaning to what it was thought to mean by most lawyers at the time you got the advice.)

You may find it hard to find a lawyer yourself that will do the work for only £500, so HP is helping you out, by informing you of some layers that have already reviewed such documents for other employees.

HR wants you to get legal advice before you sign the document, as otherwise you could claim you did not understand the document, and hence a judge may find you are not bound by it, therefore HR are willing to pay the cost of you getting the legal advice.

  • But will the lawyers actually be required to show the regulator that they've given correct advice? What are the chances that they'll give biased advice without negative repercussions? Professionals around the world are bound by law and/or codes of ethics, yet incompetence and even unethical conduct are common. The OP is justified in being cautious, and if I were in the same situation, I'd look for another lawyer. – phoog Sep 30 '16 at 17:15
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You can go to any employment lawyer that you want. The two suggested by your bank will work just fine for you - they know 100% that you are the client, and not the bank, and they will act accordingly.

To find an employment lawyer, type "Employment lawyer near " into Google. Seriously, that's all you need to do. I put in my village, and it comes up with about a dozen lawyers between three and 20 miles away.

As far as the cost is concerned, if you tell them that your company will reimburse you up to £500, you can bet that they will charge exactly £500 and will give you exactly £500 worth of advice; the invoice is likely directly sent to the company.

Now the whole purpose of that exercise is that the bank doesn't want to cheat on you (they can do an awful lot without cheating, no need to cheat), and it's worth £500 to them that you get this contract properly reviewed, and explained to you, so you have no chance of suing them afterwards by claiming you didn't understand the contract, and you will also not sue them because you misunderstand the contract.

  • "and will act accordingly": Really? How certain are you of that? There are surely unscrupulous lawyers in the UK, and there's a clear potential for a conflict of interest here. – phoog Sep 30 '16 at 17:16
  • @phoog: The whole business is about making the layoff absolutely lawsuit proof. If that lawyer, recommended by the bank, acted against the poster's (their client's) interest, the shit would fly so high... – gnasher729 Sep 30 '16 at 20:01
  • but "absolutely lawsuit proof" doesn't necessarily imply "in the employee's best interests." – phoog Sep 30 '16 at 20:02
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    @phoog: If a lawyer recommended by my (ex) company who is supposed to work for me doesn't give advice that is in my best interest, then this isn't lawsuit proof. And you'd have to assume that the contract reviewed contains terms that could byte me in the back, that I'm not told about by the lawyer, and then the company uses them against me - in that case it is obvious that I was given bad advice by a lawyer recommended by the company, and that won't survive a lawsuit. And the whole point of the exercise from the ex-company's point of view is to avoid a lawsuit in the first place! – gnasher729 Nov 1 '16 at 9:14
  • Another thing no one has mentioned is that lawyers typically have a duty to the courts and judicial system, which means, theoretically, they need to act in their clients best interests, or if they are unable to due to conflict of interest, not accept the work. There will always be unscrupulous lawyers, so theory and practice are not always the same. If you are parting on amicable terms, you are probably OK using a lawyer they suggested, but if you are "looking for more", you might want to look elsewhere. – davidgo Nov 30 '16 at 6:59

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