New year, same MARS: FAQs by employees on Mutually Agreeable Resignation Schemes

What is a MARS?

A MARS is a voluntary severance scheme which is particularly common within public sector organisations. An employee agrees to voluntarily resign in exchange for some kind of benefit from their employer. Usually, this benefit takes the form of a tax-free payment.

Who can apply to a MARS?

Each organisation will deal with their MARS scheme differently, however, the usual process is that the scheme will be announced and you will then be able to apply. Your application will require certain criteria, and you will then receive confirmation as to whether you have been accepted onto the scheme.

What happens once approved onto the scheme?

An employee will usually receive confirmation as to whether they have been accepted or rejected onto the scheme. If an employee is accepted, they will likely be offered a settlement agreement/MARS agreement which they will need to arrange to have explained by a solicitor.

Why does an employee need to enter into a settlement/MARS agreement?

A MARS agreement will set out all formalities of an employee’s employment ending with their employer, including a termination date, details of a tax-free payment, and importantly it will include mechanics for an employee to waive their rights to being able to pursue any employment related claims against their employer.

Does an employee have to pay for their legal advice on the agreement?

No, it is usual that the employer will contribute/ cover the legal fees for the employee to take advice. The standard contribution is usually £500 plus VAT, however, at Ellis Jones we cap our costs at the contribution offered.

What is the process once an employee has received their agreement?

At Ellis Jones our process is as follows:

1. Receive instruction from an employee;
2. Arrange and carry out an advice meeting usually over the phone or via Microsoft Teams (approximately 1 hour);
3. Once advice has been given and the employee is content with the agreement we can arrange signing of the agreement (using an electronic signature or scanned document);
4. We will return the agreement directly to the employer;
5. We will raise an invoice directly to the employer for the legal advice given.

What should an employee do if they are in need of finding a solicitor to assist with a MARS agreement?

Get in touch with our expert Employment team today on 01202 525333 or email employment@ellisjones.co.uk to book in with one of our solicitors

How quickly can Ellis Jones offer advice?

We understand that settlement agreements need to be dealt with quickly and can often offer a same day service. We can arrange a face-to-face meeting, by telephone, or online.

If you have been offered a settlement agreement under a MARS or any other situation, please do not hesitate to contact us on settlementagreement@ellisjones.co.uk or 01202 057754 to speak to a friendly and reassuring adviser from our Employment team.