Turner v Western Mortgage Services Ltd [2025]

The Employment Appeal Tribunal’s decision in Turner v Western Mortgage Services Ltd [2025] EAT 191 offers an important reminder of how widely ACAS COT3 agreements can operate. The aim of a COT3 agreement is to resolve a dispute between an employer and an employee but ensuring that the wording is carefully thought through is important.

Mr Turner, a mortgage adviser, brought an Employment Tribunal (ET) claim relating to alleged non‑payment of permanent health insurance (PHI) benefits, pension contributions, and discrimination. His PHI complaint was struck out, and did therefore not receive a full hearing, prompting him to lodge an appeal with the Employment Appeals Tribunal (EAT).

The effect of entering into a COT3

While the appeal was ongoing, the parties entered a COT3 agreement via ACAS. The agreement required Mr Turner to withdraw his tribunal claim and stated that the settlement was in ‘full and final settlement of any and all claims’ he had or may have against his employer, save for limited, specifically listed exceptions which were not relevant to the following issues.

The COT3 was signed and the ET dismissed the claim. Western Mortgage Services meanwhile notified the EAT that the appeal should not proceed on the basis that the action had been settled. Mr Turner, however, sought to continue with the appeal, arguing that the settlement related only to the remaining live complaints, not to the PHI issue that had been struck out and was the subject of the appeal.

The EAT rejected Mr Turner’s argument. It held that the COT3 was a binding contract and must be interpreted objectively, without regard to what either party subjectively believed at the time. When read as a whole, the agreement clearly compromised all claims unless expressly excluded. Because the PHI complaint was not carved out, it fell within the settlement.

The EAT will generally not proceed with an appeal that serves no practical purpose, and there was no compelling reason to do so here given that even a successful appeal could not revive the underlying claims. The appeal was therefore dismissed.

Key points for employers

For employers, this decision reinforces the value of clear, comprehensive drafting when concluding a COT3. Broad, unqualified phrases such as ‘any and all claims’ are likely to be given their natural meaning, providing finality unless exclusions are expressly spelled out. If you intend a settlement to cover ongoing appeals, withdrawn claims, or issues previously struck out, a well‑worded COT3 can achieve those aims.

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