Are settlement agreements valid and enforceable under Law 75?

I’m not aware of a dealer ever challenging a written agreement after it receives the compensation it voluntarily accepted for the settlement of an actionable Law 75 claim. It is routine to settle Law 75 claims to avoid trial. It is typical for the payor (usually the principal) to require and state in a written agreement that it does not admit liability as a condition to settle and it does so to avoid the costs and inconveniences of trial. It is usual for Law 75 cases to settle for amounts that are short of the total compensation that a fact finder could potentially award the dealer in damages if there was liability, or for amounts less than the measure of full Law 75 damages. The question about the validity of settlement agreements is provoked by Law 75’s anti-waiver provision that it is a remedial legislation, and its protections cannot be waived. For example, if Law 75 applies, parties cannot waive by contract that the agreement expires at the end of the term and will not be renewed or waive just cause for termination or non-renewal. In another similar context, an agreement cannot state that it is not a dealer's or distribution contract to avoid legal protections.Those are the obvious cases. Less usual, but found by an arbitration panel not to waive Law 75 rights, is a liquidated damages provision in a Law 75 agreement in the event of a termination. But that case was factually unusual because the distribution of the line and its goodwill were fully mature, valuable, and developed by the owner when the dealer took over the distribution rights.This anti-waiver provision has never come into play in the context of a settlement agreement. I am inclined to think that a settlement agreement, that would otherwise be valid and enforceable at civil law, does not implicate Law 75’s anti-waiver provision.The dealer could be receiving less money than the maximum measure of damages, but Law 75 does not guarantee any compensation much less require a severance (“mesada”). Actual damages must be proven.The factors in Law 75 to award damages are just guidelines. Law 80, which tracks Law 75’s just cause requirement and is vested with public policy, does obligate an employer to pay the statutory severance (“mesada”) for an unjustified termination. Puerto Rico’s Supreme Court is evenly split down the middle 4-4 on the validity of a settlement agreement where the employee admits that there was just cause for termination as a condition to receive a settlement payout. Four Justices would hold that the settlement agreement of a Law 80 claim on those terms is illegal and contrary to public policy. They reason it was a waiver of the employer's burden to prove just cause for termination and bypassing payment of the compulsory "mesada". But the case should raise some eyebrows when settling claims involving special laws, like Laws 75/21, that have strong public policies behind them. The decision, Feliciano v. Luxury Hotels, 2022 TSPR 133 (Oct. 26, 2022), gives food for thought about how far reaching could this decision be in employment cases or if it is limited to the facts. Stare decisis is that settlement agreements of Law 80 claims are valid, at least for the time being.