Settlement Agreement Rejection Letter: Free Template and What to Include

If you need to reject a settlement agreement and state intention to pursue tribunal claim, 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 rejection should include.

What this letter needs to cover

• State clearly the offer is not accepted
• Confirm intention to proceed with employment tribunal claim
• Reference the relevant legal claims
• Note that the without prejudice nature of the offer means it cannot be referred to in proceedings

Formally rejecting a settlement agreement

If you've decided the offer doesn't adequately reflect your claim's value, or you'd prefer to pursue matters through the Employment Tribunal, a clear written rejection protects your position and preserves your right to proceed, particularly important given tribunal time limits keep running regardless of settlement discussions.

What to include before you send it

• A clear statement that you're rejecting the settlement offer
• Confirmation of your intention to pursue an Employment Tribunal claim, if that's your decision
• Any brief reasoning, if you wish to leave the door open to future negotiation
• Confirmation you've taken independent legal advice, if applicable

Watching your tribunal time limit carefully during negotiations

Settlement discussions don't automatically pause your tribunal time limit (unlike ACAS early conciliation, which does) — if negotiations drag on close to your deadline, it's important to protect your position, potentially by lodging a claim even while discussions continue.

Frequently Asked Questions

Can I still negotiate further after formally rejecting an offer?
Yes — rejecting a specific offer doesn't necessarily end all negotiation, and it's common for parties to continue discussing terms even after an initial rejection.

Does rejecting affect my ongoing employment if I haven't already left?
This depends on your specific circumstances — it's worth thinking through carefully what rejection means practically for your day-to-day working relationship if you remain employed.

[Your Name]
[Your Address]
[Your Postcode]
[Name of HR Contact or Manager]
[Company Name]
[Company Address]
[Company Postcode]
[Date]

Dear [Name],

Subject: Settlement agreement offer – not accepted

I have taken advice and I do not accept the settlement agreement offered on [Date].

The offer does not reflect the value of my claims for [e.g. unfair dismissal / discrimination / unpaid wages].

[Choose:]
[I intend to bring an employment tribunal claim. I will start Acas early conciliation, which must happen before a claim is made.]
[I intend to continue my [grievance / appeal] through the company's procedures, and I may bring an employment tribunal claim.]

The offer was made without prejudice, so it cannot be referred to in any tribunal proceedings.

I remain open to an improved offer.

Yours sincerely,

[Your Signature]
[Your Printed Name]