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In brief

The Court of Appeal has confirmed that an Acas-negotiated COT3 settlement agreement covered an individual’s claim that his former employer had knowingly helped a subsidiary unlawfully victimise him when the subsidiary rejected his job application. This situation was covered by the COT3’s express terms settling claims that indirectly arose in connection with his employment.

In more detail

In Arvunescu v Quick Release (Automotive) Ltd, the claimant issued proceedings claiming race discrimination. The parties entered into an Acas-negotiated COT3 settlement agreement in March 2018. Its terms included claims that indirectly arose in connection with his employment. Prior to concluding the settlement, in February 2018, a wholly-owned German subsidiary of Quick Release (QR) rejected a job application from the claimant. Following the settlement, in May 2018, the claimant issued new proceedings against QR, essentially saying that it had engineered his rejection.

The tribunal, EAT and Court of Appeal have all concluded that this new claim was covered by the settlement, and therefore could not proceed. 

In the lower tribunals, there was a question as to whether this case involved an attempt to settle a future claim, which is sometimes a thorny issue, as seen in another recent case (see “United Kingdom: Settlement agreement did not cover an unknown, future age discrimination claim“). However, in the Court of Appeal, the case proceeded on the basis of the chronology described above, meaning that the alleged unlawful conduct had already occurred before the settlement.

The EAT and Court of Appeal agreed that the claim was properly described as one where QR knowingly helped its subsidiary to victimise the claimant. In other words, it ensured that the subsidiary rejected the claimant’s job application, because he had claimed race discrimination against QR. The court decided that this type of claim could be characterised as indirectly arising in connection with his employment, and therefore was within the scope of the settlement.

Most precedent settlement agreements do refer to claims that indirectly arise in connection with employment or its termination, but this decision serves as a reminder to check that this is the case.


John Evason manages the employment team in London. He is a specialist employment lawyer advising on all aspects of employment law. He is ranked as a star individual in Chambers and a leading individual in Legal 500. He is a member and former chair of the Legislative and Policy Sub-Committee of the Employment Lawyers Association which provides comments to the UK government on new and amended legislation and regulations. He is a regular speaker at conferences and seminars, and frequently contributes to various legal and personnel publications.


Annabel Mackay has extensive experience of advising employers and employees on a range of complex employment issues. She has been ranked in Legal 500 and Chambers & Partners since 2015. Chambers & Partners 2019 report that clients describe Annabel as: "supremely impressive and technically brilliant while also being commercially astute and incredibly bright."


James Brown is a Knowledge Lawyer in Baker McKenzie, London office.

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