Settlement Agreement Counter-Proposal Letter Template
How to propose revised terms in response to an employer's settlement offer — what it should include, your legal standing, and a free generator.
← All Letter Templates · Settlement Agreement · Last updated 18 August 2026 · Written and reviewed by Matthew, founder of UK Work Rights
This is free rights guidance, not legal advice. For advice specific to your situation, see our About page or contact Citizens Advice.
If you need to propose revised terms in response to an employer's settlement offer, a written letter is the recommended first step — it creates a clear record and shows you're pursuing the matter formally. Below is what a strong settlement agreement counter-proposal should include, plus a free tool to generate yours.
What this letter needs to cover
- Acknowledge the offer without prejudice
- Set out the counter-proposed financial amount and revised terms
- State the legal basis for the revised figure including potential tribunal value
- Set a reasonable deadline for response
Why a counter-proposal is often the right first response
An initial settlement offer is rarely an employer's final position — it's a starting point, and responding with a clear, well-reasoned counter-proposal is standard practice, not confrontational. Employers generally expect some negotiation, and a reasonable counter often leads to a better outcome than simply accepting or rejecting outright.
What to include before you send it
- Acknowledgement of the original offer
- Your proposed revised terms, with clear reasoning for the changes
- Any specific non-financial terms you want addressed — reference wording, notice period, or announcement handling
- A reasonable timeframe for a response
What to think about beyond just the headline figure
Settlement negotiations aren't only about money — the wording of any reference, confidentiality terms, treatment of notice pay and outstanding holiday, and timing of payment can all matter significantly and are worth addressing explicitly in your counter-proposal.
Frequently Asked Questions
Should I get independent legal advice before countering an offer?
Yes — settlement agreements are only legally binding once you've received independent legal advice, and your employer is often willing to contribute to this cost, so it's worth requesting this as part of the process.
Is there a risk in countering rather than just accepting?
Generally no, provided you remain reasonable — most employers expect negotiation and won't withdraw a genuine offer simply because you've proposed reasonable alternative terms.
Ready to write yours?
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