Contractors' Questions: When can I go direct-to-client?
Contractor’s Question: I’m approaching the end of a contract that was arranged through an agency and the client has said they may want me back but preferably direct through my limited company. Is there a minimum period between the end of the agency contract and me starting direct for the client that has to be observed? I cannot find anything relevant in my agency contract.
Expert’s Answer: Once the contract with the agency has come to an end, either by the end of a fixed period or notice in accordance with the contract, you will be free to work directly for any party you wish, whether individually or through your limited company, unless there are any restraint clauses in your contract with the agency. In the event that there are no such clauses, you should be free to contract directly once the agency contract has come to an end.
However, it is possible that the contract the agency has with the hirer will provide for commission to be paid to the agency by the hirer in the event that the contract is renewed or a direct contract is entered into. Any such clause is likely to provide that any associated party, such as your limited company, will be caught. So the potential for the hirer to be liable to pay any commission/agency fees should be assessed before you proceed.
The expert was Nigel Musgrove, on behalf of legal advisory Cousins Business Law.
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