Settlement Agreement Template (Ireland)
A settlement agreement fully and finally resolves a dispute between parties, usually involving a payment and a release of claims. Our free Irish template includes the release, payment mechanics, confidentiality, non-disparagement and — if proceedings have been issued — a Tomlin-style stay, drafted in line with Irish contract law and the Mediation Act 2017.
1.2 A dispute has arisen between the Parties in connection with Unfair Dismissal under the Unfair Dismissals Act 1977–2015 (WRC/Labour Court Reference: ADJ-00012345).
1.3 The Parties wish to resolve this dispute amicably and without further recourse to litigation, in accordance with the terms set out in this Agreement.
1.4 This Agreement is entered into on a without prejudice basis until executed by both Parties, whereupon it becomes binding.
2.2 The Settlement Payment shall be paid by bank transfer to the Employee's nominated bank account on or before within 14 days of the date of this Agreement.
2.3 Time for payment is of the essence. In the event of late payment, the Employee shall be entitled to statutory interest under the Courts Act 1981 (as amended) on the outstanding amount from the due date until actual payment.
2.4 The Employer shall also pay the Employee any outstanding wages, holiday entitlements (under the Organisation of Working Time Act 1997 (OWTA 1997)), and expenses accrued up to the Termination Date, such payments to be processed through payroll in the usual way within 14 days of the Termination Date.
3.2 The Settlement Payment is an ex gratia payment made in connection with the termination of the Employee's employment. The Parties agree that the Basic Exemption under section 123 of the Taxes Consolidation Act 1997 (TCA 1997) applies to the first EUR 10,000 of this payment, and that the Employer shall deduct PAYE, PRSI and USC only on any amount exceeding the applicable exemption thresholds, subject to the Employee providing any necessary declarations or forms to the Employer.
3.3 Each Party shall be responsible for obtaining their own independent tax advice. The Employer makes no warranty as to the ultimate tax treatment of the Settlement Payment. If Revenue determines that additional tax is due on the Settlement Payment, the Employee shall be responsible for any such additional tax liability, unless the Parties have expressly agreed otherwise in writing.
4.2 The Employee acknowledges that the Settlement Payment and other benefits provided under this Agreement represent adequate and sufficient consideration for the releases and undertakings given herein.
(a) Claims under the Unfair Dismissals Act 1977–2015 (UDA 1977);
(b) Claims under the Employment Equality Acts 1998–2015 (EEA) (discrimination, harassment, equal pay);
(c) Claims under the Organisation of Working Time Act 1997 (OWTA 1997);
(d) Claims under the Payment of Wages Act 1991 (PWA 1991);
(e) Claims under the Redundancy Payments Acts 1967–2014;
(f) Claims under the Protection of Employees (Fixed-Term Work) Act 2003;
(g) Claims under the Minimum Notice and Terms of Employment Acts 1973–2005;
(h) Claims under the Safety, Health and Welfare at Work Act 2005;
(i) Any claim for breach of employment contract, wrongful dismissal, or tortious claim arising from the employment relationship;
(j) Any claim under Irish or EU employment law not otherwise specified above.
5.2 The Employee acknowledges having received independent legal advice prior to signing this Agreement and fully understands the scope of this release.
6.2 The withdrawal shall be made in such form as required by the relevant tribunal. Any obligation under this clause is contingent on the Employer complying in full with its payment obligations under Clause 2.
(a) To legal advisers and tax advisers who are bound by professional duties of confidentiality;
(b) To Revenue Commissioners or other statutory or regulatory authorities as required by law;
(c) To a court or tribunal of competent jurisdiction pursuant to a court order;
(d) To a spouse or civil partner of the Employee for purposes of financial planning (on terms of confidentiality).
7.2 For the avoidance of doubt, nothing in this Agreement shall prevent, restrict, or penalise either Party from making a protected disclosure within the meaning of the Protected Disclosures Act 2014 (as amended by the Protected Disclosures (Amendment) Act 2022), or from reporting an offence to An Garda Síochána or a relevant regulatory body.
7.3 This confidentiality obligation survives the termination of this Agreement.
8.2 The Employee shall also, promptly following the Termination Date, delete all Employer confidential information from personal devices and cloud accounts not controlled by the Employer, and shall provide written confirmation of such deletion on request.
9.2 The enforceability of any post-termination restriction shall be determined by reference to Irish common law principles: restrictions must be reasonable in scope, duration, and geographic area, and must protect a legitimate business interest — see Murgitroyd and Company Ltd v Purdy [2005] IEHC and Countrywide Renewable Energies Ltd v Martin [2018] IEHC 540.
9.3 Nothing in this Agreement shall prevent the Employee from seeking new employment or engaging in any occupation that does not breach any enforceable post-termination restriction.
10.2 The Employee acknowledges that they understand the terms of this Agreement and sign it freely and voluntarily, without duress, coercion, or undue influence.
10.3 The Parties acknowledge that receipt of independent legal advice is a standard requirement for an effective settlement of employment claims in Ireland, and that this Agreement is intended to be legally binding in accordance with section 39 of the Workplace Relations Act 2015 (WRA 2015) (binding settlements recorded in writing).
11.2 Any dispute arising out of or in connection with this Agreement shall, in the first instance, be subject to the jurisdiction of the Workplace Relations Commission (WRC) and/or the Labour Court where a statutory claim is involved, or the Circuit Court or High Court of Ireland for contractual claims.
12.2 No variation of this Agreement shall be valid unless made in writing and signed by both Parties.
12.3 If any provision of this Agreement is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, the remaining provisions shall continue in full force and effect.
Confirm dates of employment (1 March 2019 – 31 January 2026), role as Senior Sales Manager, acknowledge strong commercial track record and team leadership, confirm departure was by mutual agreement.
13.2 The Employer agrees that it will respond to any future employment reference requests from prospective employers in a manner consistent with the agreed reference letter and will not disclose any information that contradicts or undermines the agreed reference.
13.3 The Employer shall ensure that all relevant HR personnel and line managers are notified of the agreed reference terms.
14.2 The Employer agrees that it will not make any statement to any third party — including any prospective employer, client, or business associate of the Employee — that is disparaging or damaging to the Employee's professional reputation.
14.3 For the avoidance of doubt, this clause does not prevent either Party from giving truthful testimony in legal proceedings, making a protected disclosure under the Protected Disclosures Act 2014 (as amended), or making any statement required by law or a regulatory authority.
15.2 The Parties acknowledge that a contribution to the reasonable legal costs of an employee in connection with the termination of employment may qualify for an income tax exemption under section 192A of the Taxes Consolidation Act 1997 (TCA 1997). Each Party shall seek their own independent tax advice regarding this payment.
15.3 Save for the Costs Contribution expressly provided in this clause, each Party shall bear its own legal and professional costs arising from the dispute and the negotiation and execution of this Agreement.
What Is a Settlement Agreement?
A settlement agreement (sometimes called a compromise agreement or deed of settlement) is a binding contract by which the parties to a dispute agree to resolve their differences on terms. It typically includes a payment by one party, a release of claims by the other, provisions about confidentiality and non-disparagement, and a mechanism for handling any existing court proceedings.
In Ireland, settlement agreements are used to resolve contract disputes, commercial litigation, employment disputes, professional negligence claims, and family law matters. They are encouraged by the Irish courts as a legitimate and often preferable alternative to trial. The Mediation Act 2017 requires solicitors to advise clients of the benefits of mediation and settlement before issuing proceedings.
Where proceedings have already been issued, the settlement can be recorded in a "Tomlin order" — proceedings are stayed save for the purpose of enforcing the agreed terms, which are set out in a confidential schedule to the court order. This approach keeps commercial terms private while providing a straightforward route to enforcement if the agreement is breached.
What's Covered in This Template
The template covers every element needed for a robust Irish settlement.
Party Details
Names, addresses with Eircode, and legal representation.
Background and Dispute
Concise narrative of the dispute and any proceedings issued.
Settlement Sum
Amount in euro, payee, bank details and due date.
Payment Terms
Lump sum or instalments, interest on late payment, and default clauses.
Full and Final Release
Mutual release of all existing and related claims.
Without Admission of Liability
Standard "no admission" clause.
Confidentiality
Mutual confidentiality of the terms and carve-outs (professional advisers, legal requirements).
Non-Disparagement
No derogatory statements about the other party.
Tomlin-Style Stay (where proceedings issued)
Stay of proceedings save for enforcement.
Costs
Agreement on legal costs.
Dispute Resolution
Mediation under the Mediation Act 2017 and jurisdiction of Irish courts.
Governing Law
Ireland as the governing law.
How to Create a Settlement Agreement
Document a settlement quickly with our Irish-law template.
- 1
Enter Party Details and Background
Record party names, addresses and a concise description of the dispute and any proceedings.
- 2
Agree Payment Terms
State the settlement sum in euro, payment schedule, and bank details.
- 3
Draft the Release
Scope the release of claims carefully to cover existing and related matters.
- 4
Add Confidentiality and Tomlin Stay
Include confidentiality and, where proceedings are issued, a Tomlin-style stay of proceedings.
- 5
Sign and Perform
Each party should take legal advice, then sign. Make the payment and discontinue proceedings as agreed.
Legal Considerations in Ireland
Settlement agreements are powerful but must be carefully drafted to achieve finality.
This template is for information only and is not legal advice. Independent legal advice is strongly recommended for any settlement.
Drafted for Irish law
Enforceability as a Contract
A settlement agreement is a contract and is enforceable under Irish contract law once properly executed. For maximum evidential weight, it can be executed as a deed, which removes the need to prove consideration and provides a longer limitation period under the Statute of Limitations 1957.
Tomlin Orders in Irish Proceedings
Where proceedings have been issued, the parties can record settlement in a Tomlin order under which the proceedings are stayed save for the purpose of enforcing the agreed terms set out in a confidential schedule. This balances enforceability with confidentiality.
Employment Settlement Agreements
In an employment context, settlement agreements waiving statutory rights (unfair dismissal, employment equality) should be informed, reduced to writing, and the employee should have received independent legal advice. A failure can render waivers unenforceable and expose the employer to Workplace Relations Commission claims.
Tax Treatment
The Revenue Commissioners distinguish between capital and income elements of a settlement for tax purposes. Employment termination payments may benefit from statutory tax reliefs (section 201 Taxes Consolidation Act 1997). Tax advice should be obtained for material settlements.
Frequently Asked Questions
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