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If someone has asked you to sign a “deed of release” to settle a dispute, it is important to understand what you are agreeing to before you sign.
Deeds of release often contain common clauses that explain what each party agrees to do.
Every deed differs, but some common clauses include:
A deed of release is a legal document that usually ends a workplace dispute. It is often used to settle a claim, sometimes in return for money, an apology, or a correction.
You may be asked to sign a deed of release when you leave a job. You can also be asked to sign one while you are still working, for example to settle a complaint.
Before signing, it is important to understand what you are agreeing to before you sign. When you sign it, you may release (give up) your right to take the matter to court. It may also ask you to promise not to talk about what happened.
A deed is more formal than a normal agreement. Because it is so strong, it can be binding even if you are not getting anything in return. It is usually signed in front of a witness.
Even if you sign a deed with a confidentiality clause, you usually keep some rights. For example, you can normally still report a crime to police and get legal, medical, or counselling support. However, this depends on how the deed is written. Before you sign, ask a lawyer to check that these rights are protected.
Once signed, a deed of release may be final and difficult to challenge. You should seek legal advice before signing.
You do not have to sign a deed of release immediately. Do not sign if you feel rushed or pressured. It is okay to take time to think.
Before signing, it is important to understand what rights you may be giving up.
Before signing, you should:
· take time to read the document carefully, and more than once
· make sure you understand what you are giving up
· check what you are getting in return, and whether it feels fair
· look closely at any clauses that limit what you can say
· ask questions about anything you do not understand
· get legal advice before you sign.
A settlement can include money, an apology or correction, or both. In this section, we will only talk about money.
A deed of release may set out a settlement payment that is made up of different parts. It might include harm to your reputation, money you have lost, or your legal costs.
It is important to understand how the payment is described. It is also important to understand how the payment will be paid. It might be paid as a lump sum (one payment of the whole amount) or in instalments (smaller payments over time). All of these things can change how much tax you pay.
Money owed for work (like wages) is usually taxed as income. Other payments (like a general damages payment, which is money for hurt and harm) may be treated differently.
Before signing, you should get legal advice about:
A deed of release is a voluntary agreement. You do not have to sign a deed if you do not agree with it or do not understand it.
An employer may make a settlement payment “conditional” on you signing a deed of release. This means you might not receive the agreed money unless you agree to the deed.
Do not feel pressured to sign immediately. Take time to read the deed carefully, ask questions, and get legal advice before deciding whether to sign.
Usually, no. Once you sign, a deed of release is legally binding and difficult to challenge or undo. You may be able to challenge it in limited circumstances – for example, if you were pressured, misled, or did not understand what you were signing.
This is why it is very important to get legal advice before you sign.
If you have already signed and you are worried about it, you can still get legal advice. A lawyer can look at your situation and tell you what options you may have.
If you need an interpreter, call the Translating and Interpreting Service on 131 450 and ask them to call us.
If you are d/Deaf, hard of hearing, or have a speech impairment, contact us through TTY on 133 677, Speak and Listen on 1300 555 727, or Internet Relay via the National Relay Service website.
Need support, not legal advice? Call Full Stop Australia on 1800 385 578, or 13YARN at 13 92 76 if you are First Nations.
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