What can I do if I was forced to sign a dead of release upon termination of employment?

What can I do if I was forced to sign a dead of release upon termination of employment?

You may have been employed by your employer for a long period of time and feel that you are valued. On this basis, you may feel that your position is not under threat. You have always received very positive performance reviews and been encouraged and awarded generous salary increases and bonuses. Your employer is a large corporation and you feel safe that it will do right by you because of the success you have achieved working on various projects. Your immediate boss and those above him have always strongly regarded your work ethic and you approach each day of work as a new challenge, feeling no threat to your employment.

You may then be taken by surprise and caught off guard when you are suddenly dismissed. You may even feel bamboozled by the reasons given as you had no indication or hint that you may be dismissed. When a dismissal letter or document is presented to you, you may feel so aggrieved that you sign without thinking of the personal and legal ramifications.

It is possible that the document you signed is a deed of release, a binding legal document which establishes a post-termination agreement between yourself and your employer. This agreement contains a final settlement as to the existing legal rights after your employment relationship comes to an end. It will usually include a sum of money which is considered to be compensation, and in return for the compensation you agree not to bring any legal proceedings against your then former employer. Should you attempt to bring any legal proceedings at a future date, your former employer will rely on this deed of release and ask the court to immediately prevent you from continuing your application.

Your deed of release or termination letter will usually contain statements which cover the following issues such as severance pay, taxation, post-termination restraint of trade covenants, the legislation upon which you cannot rely to bring a claim against your former employer, assurances on your own behalf, an agreement to maintain confidentiality and not to make derogatory statements regarding your former employer. You or your lawyer may also be able to negotiate with your former employer for a reference or statement of service to be provided so that you can continue your career without a black mark against your name for being dismissed from your previous employment.

When a deed of release is negotiated on your behalf and reflects a mutual agreement between yourself and your former employer, it is regarded as a positive outcome and respectful way to end the employment relationship. However as a binding legal document, you must be aware of the legal consequences of signing it. In many deeds of release, you agree not to bring any action against your former employer except in relation to WorkCover claims.

However if a deed of release has been thrust in front of you to sign, you may feel upset and insulted that you are being dismissed. You may feel that after your impressive results and years of service to your employer that you deserve to be treated better. It is crucial that you take home any documents that your employer provides you with to ensure that you give considerable thought to any document you may bind yourself with. If you have impulsively signed a deed of release you should seek legal advice as to achieve any recompense against your former employer, you will need to apply to the court to have the deed of release set aside.

Whether you are able to have your deed of release set aside will depend on all of the facts and circumstances surrounding your matter. There are doctrines which you may be able to rely on if you can establish that it is wrong for your former employer to rely on the deed of release.


Duress is the most obvious course of action where a deed of release should be set aside. It includes physical and economic duress where your former employer places excessive pressure on you to sign the deed of release. It may include threats of a physical nature as to violence against you or someone you know if you do not adhere to your employer’s demands. If you can establish that the threat to your physical safety is a reason why you signed the deed of release, you may have grounds on which to set it aside.

A more recent doctrine is that of economic duress. This reflects the idea that immense pressure can be placed on you to sign a document without a threat to your physical safety being uttered. It may be enough to show that there was an unacceptable amount of commercial pressure placed upon you to sign. Your employer might promise you more severance money if you sign, or might attempt to trick you into believing that you are not lawfully entitled to more money.

Undue Influence

Another form of unacceptable pressure is that of undue influence. This method can be deceptive as on its face as it may initially appear that the deed of release was validly entered into. In fact, you may have entered into the agreement willingly, believing it to be a fair bargain for all parties concerned. However it may be that because of the relationship between the parties no fair agreement can ever be reached.

There are set relationships which are regarded in law as inherently imbalanced and an agreement will be presumed unfair and be set aside upon application to the court. The employer/employee relationship is not one that is automatically deemed to be inherently imbalanced, although in may circumstances there will be a definite power imbalance. If you can establish that your relationship with your employer was one that involved an inherent imbalance, the onus then shifts to your former employer to show that the agreement that you entered into was made fairly.

Unconscionable Bargaining

Another way which you may establish that your former employer should be prevented from relying on your deed of release is that of unconscionable bargaining. This may arise when negotiations with your employer are abused. This may be a fall back option available to you if there was no duress or if you cannot establish that your relationship with your former employer was one of inherent imbalance. It will generally occur where you did not understand the implications of the document and you show there are unique factors to your situation which prevent your former employer relying on the document which you signed.

Some factors which you may use to establish unconscionable bargaining include mental disability, education and language skills.

It is important to note that the merits of you application to have the signed deed of release set aside will be strongly dependant on the circumstances surrounding your matter and you should obtain legal advice if you have signed such a termination document.

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