A Compromise Agreement is a legal contract between an employer and an employee, often used when an employee is leaving a job. This agreement typically outlines the terms of the departure, including any severance pay, benefits, and the conditions under which the employee agrees not to pursue legal action against the employer. These agreements are designed to protect both parties. For the employer, it helps to prevent future claims related to employment, while for the employee, it provides a clear understanding of their rights and any compensation they will receive. Legal advice is often recommended before signing a compromise agreement.