Contractors' Questions: Is agency liable for not serving me my notice period?

Contractor’s Question: I recently signed a contract with a UK recruitment agency, who signed a contract with a German agency which is running an assignment for their client in Germany. But the German agency have had their contract terminated by the client.

It clearly states on my contract that a four-week notice period is required; however, the agency in Germany didn’t give me or the UK agency any notice and I still don’t have a written notice from my UK agency. Would I be able to go after my UK agency, as it’s with them that I signed the original contract stating the 4-week notice period?

Expert’s Answer: You mention that you are entitled to a four-week notice period under the agreement. Nevertheless, it is imperative that you read the contract carefully with regard to the agreed termination provisions, as this will govern which remedies (if any) are available.

It is necessary to appreciate the basic contractual position of the parties when the contractor is supplied by an agency. In this situation, the contractor has entered into a binding agreement with a UK agency, which has in turn entered into a separate binding agreement with a German agency. The German agency has contracted with the end-client. Given that the contractor has only entered into an agreement with the UK agency, then he/she is unable to take action against the German agency or their client, as there is no direct contractual relationship between the contractor and those parties.

Remember, the agency will usually be obliged to pay you if you have not been paid under Regulation 12 of the Conduct of Employment Agencies and Employment Business Regulations 2003. However, you should ensure that you have a written agreement in place and that you haven’t signed anything to opt-out of the Regulations, whether in your contract or in a separate document. Again, this is a case of you (or a legal adviser on your behalf) reading the documents carefully to determine precisely what has been agreed.

Finally, you should consider the wider commercial implications of pursuing a claim against the agency. Choosing to litigate will effectively end the business relationship and will hinder (if not completely extinguish) your chances of obtaining future work from the agency. You should carefully consider the prospects of obtaining more work via the agency and whether the relationship is valuable enough to forgo any monies that may be entitled to you. Every experienced contractor will have been in a similar position at some stage in their career and careful consideration should be given to the outcome of your chosen course of action.

The expert was Mekael Rahman, trainee solicitor at Lawdit Solicitors.

Editor’s Note: Related Reading –

Contractors' Questions: Can I reduce my contract notice period?

Contractors’ Questions: Is my agent skewing the notice clauses?

Contractors' Questions: Can an agency cut my notice period?

Tuesday 13th January 2015