Problem with Contact between agency and client.

[mysgies]

Hi All,

I am verge of lossing my job, looking for your honest reply on this.

I am working as a contractor for a company through my limited company and got this through an agency. The client is very happy with my work and have no problem in continuing with me. But the problem is my client has to pay a good slice of amount I earn and they are not ready to continue with this. According to the client, they have a contract with agency which stats that they can't work with my limited company for 12 months after termination of the contract.

They tried to negotiate with Agency on removing this clause in turn for a lumpsum money and free me up, but agency is not ready to do so.

In such a situation my client is putting his hand back.

I have a couple of questions here -

1. Can I open another limited company and start working with my client through that, will it involve any legal breach considering the contract of my client with agency for my current limited company.

2. Can you suggest any other work around which can help me/my client to continue with involving in any legal stuff (umbrella or something else)?

Please advice.

Thanks
Sgies

[NotAllThere]

If the contract only says that they cannot work with your ltd co. then setting up a new ltd co. will solve the problem.

If the contract specifies you as the worker, directly or indirectly, then it may be more difficult.

If you are opted in, then I believe there is no problem - you can go direct, maybe.

Get legal advice.

If you and the client part company, the agency get nothing. I find it hard to believe that an agency would truly give up the prospect of being paid a lump sum, in return for nothing. You mention a large margin - perhaps you or the client should tell the agent to reduce the margin or lose the contract. Again, the agent risks getting nothing. It seems likely that the agent really doesn't believe that the contract will end.

[TheFaQQer]

I am verge of lossing my job, looking for your honest reply on this.

No - you are on the verge of coming to the end of a contract. Your job is with your limited company, not with the client.

my client has to pay a good slice of amount I earn and they are not ready to continue with this. According to the client, they have a contract with agency which stats that they can't work with my limited company for 12 months after termination of the contract.

How much is a "good slice"? Is there any chance that the agency will cut their commission?

They tried to negotiate with Agency on removing this clause in turn for a lumpsum money and free me up, but agency is not ready to do so.

I find this hard to believe - they have told the agency that they will be terminating the agreement, and offered money, but the agency turned them down? It sounds like the client isn't offering enough.

If the contract only says that they cannot work with your ltd co. then setting up a new ltd co. will solve the problem.

If the contract specifies you as the worker, directly or indirectly, then it may be more difficult.

Many contracts will be worded such that the limited company and any representatives of the company cannot go direct for a set period - if this is the case, then there is nothing that you can do legally. You need to see what the wording is between the agency and client and also between your company and the agency.

If you are opted in, then I believe there is no problem - you can go direct, maybe.

Opting in would help the contractor, but the problem here is the contract between agency and client - opting in would help if there is an equally restrictive clause between agency and contractor, but won't help for the contract between agency and client.

If the client will not pay the commission, and cannot agree a pay off to release themselves and your company from the contracts, then there is nothing that you can do to get out of it.

No doubt someone will come along and suggest that the agency probably won't find out about it, and if they do, they probably won't do anything about it. I would suggest that this is a naive approach to take - if they do find out about it, they can certainly sue the client, and possibly you too. If they do that, then they will win - it's an open and shut case that you are guaranteed to lose and will have to pay costs as well as damages.

If you can't find a way round it, move on and find another contract - that's what being in business is about (although the actions of the client seem a bit sh1tty to me, since they knew in advance what the rate would be and agreed it with the agency).