Clifford v IBM United Kingdom Ltd [2024]

In the recent case of Clifford v IBM United Kingdom Ltd [2024], the Employment Appeal Tribunal (EAT) applied the decision in Bathgate v Technip Singapore Ltd [2023] and held that it was correct to strike out a disability discrimination claim as it had been prohibited by the settlement agreement agreed between the Mr Clifford and IBM United Kingdom Ltd (IBM) a number of years earlier.

In the case of Bathgate v Technip Singapore PTE Ltd [2023], it was held that a settlement agreement can be used to settle future claims that are unknown to the employee at the time of entering into the agreement. The potential claim must be identified in the agreement itself and the meaning of the words used must clearly cover the specific claim. There is no requirement that the complaint must have been known at the time of the agreement, however, it requires the potential claim to be clearly covered by the terms of the agreement.

In Clifford v IBM United Kingdom Ltd, Mr Clifford had been employed by IBM. He had been absent from work due to ill health from September 2008. In 2012, he filed a grievance against IBM, covering several issues, including the company’s failure to transfer him to their company disability plan.

After the grievance, the parties entered into a settlement agreement in April 2013 where it was agreed that Mr Clifford would transition over to the disability plan while remaining in employment with IBM. He would receive disability salary payments at a specific level and in exchange, waive his rights to pursue specific claims, regardless of whether they had been anticipated at the time of the agreement. There had been an exception in regard to future claims, however, this did not apply to matters relating to his initial grievance or transition to the disability claim.

A few years later, Mr Clifford filed a disability discrimination claim against IBM. He argued that since transitioning to the company disability plan, he had not undergone an annual salary review, his salary had remained stagnant, and his annual leave payments were lower compared to employees not on the disability plan. However, following the preliminary hearing, his claims had been dismissed due to the settlement agreement already precluding these claims. Mr Clifford then appealed this decision.

The EAT dismissed the appeal and held that the claims had been clearly listed within the settlement agreement waiver. Future discrimination claims had been covered within the settlement agreement including claims connecting to the grievance or coming out of his disability plan.

This case has clarified that future cases can be waived in settlement agreements and that the key factor is the use of appropriately clear language within the agreement. The EAT’s decision also clarifies that a future claims waiver may be enforceable where employment is continuing.

If you have any questions on settlement agreements and their ability to waive future claims, please contact a member of the Employment Team.