Loss due to delayed contract start date.

[Phil]

I secured a three month contract through Optimum IT at a major investment bank in the city. The contact was signed by myself and the agency (not the agent I was initially dealing with since he was on holiday, but one of his colleagues), had a start date of 15/8/05 (Monday) and was for £600/day.

I arrived at the client site on the 15th and they weren’t expecting me. Apparently my references and credit check hadn’t come through yet and I wasn’t allowed to provide consultancy there until they did. Also, even though I had a signed contract with Optimum IT, Optimum IT didn’t yet have a signed contract with the client. I was asked to leave the client site. The references and credit check came through late Tuesday afternoon and I eventually started at the client site on Wednesday.

In my opinion, Optimum IT is in breach of contract and my company has suffered monetary loss because of that breach. I spoke to the H.M.Customs & Excise and apparently I don’t need to charge VAT on any claim due to such a breach, so I raised an invoice for £1200 for compensation and sent it to Optimum IT. I didn’t hear anything significant about this claim until I threatened Optimum IT with legal action, when I got the following response (with some names, client details and phone number removed):

“Thank you for your mail, and I would like to firstly apologise for the delay in responding

I have read your mails to *** ****** and with regard your dispute of £1200 I would like to make the following observations.

Firstly and most obviously our contract states that where an invoice is raised we have the right to check with the client that the work that is being claimed has in fact been done. In this case no work for those days was carried out, so from a contractual obligation we are not at liberty to pay £1200.

The second and probably most important issue is the value of the contract. As I understand matters, you have been offered and have excepted a contract with ******** to the value of £39000 for 13 weeks of work.( Calculation £600 per day x 5 days per week x 13 weeks). Your dispute is that the assignment value has been reduced to £37,800. From a contractual view, you are right in one sense that had the contract been reduced in value then you possibly would have a claim, however, the contract has not been reduced in value as the contract is being honoured for 13 weeks. I believe a court would deem the delay of 2 days not to have been unreasonable. If you were to pursue the claim on the grounds of "lost time" it would then be a question of could you have mitigated your losses. You indicated to *** ****** that you could have obtained another assignment for 2 days work, and again it would be asked by all parties to look at why you did not take that other assignment for 2 days and mitigate your losses

I would like to say that we are an agency that prides itself on developing relationships with our contractors and clients, and this mail should in no way should be misconstrued as taking a stance. I am merely trying to answer your questions as honestly as I can and to give reason of why we will not be paying the £1200 claimed. It is of course your prerogative to take legal advise and to inform ******** of your dissatisfaction, however, I am sure that the client, although maybe having some sympathy will refer the matter back to the contract you have with us.

I am away out of the office from tomorrow until next Monday, but if you would like to call me to discuss further then please do not hesitate to contact me on my direct line **** *** ****
Kind Regards

****** ********
Director
Optimum IT Plc”

Optimum haven’t tried to provide me with another contract with the end date shifted two days (though according to the agent, their contract with the client has the extra two days). However working those two days would imply I wouldn’t be able to contract anywhere else (and possibly stop me from providing consultancy to another client for the remainder of the week), so the argument that my company won’t loose out is in my opinion clearly rubbish.

Is legal action for the recovery of £1200 reasonable and what are my odds for success? How much would such legal action cost? Will I be able to claim the legal costs back from Optimum IT if I win (I’ve already told Optimum IT that I would add legal costs to my claim for £1200 if they wouldn’t pay)?

Thanks in advance for any help,
Phil.

[malvolio]

At £600 a day for three months and you're worrying about £1200 that you're not owed anyway? Get real. It was a cock up, they happen. Either dry your eyes and get on with life or screw up your relationship with the agency (and lose any chance of extensions) and possibly risk upsetting the client even more. Just for once, I'm with the agency on this one.

Your choice... but try and join the rest of the grown ups.

[Lucifer Box]

To bring a successful case, you have to be able to demonstrate you have suffered a financial loss. At face value, it doesn't look at though you have. The contract is still worth exactly the same.

You are wasting your time and making yourself look foolish to the agent.

[boredsenseless]

You'll probably also find that as its a bank the position was dependant and subject to references and credit checks. Without these the contract would no doubt have been voided anyway therefore as you agree these did not arrive until Tuesday the earliest start could only have been Wednesday.

If this sort of loss is going to cause you significant financial problems then you either aren't getting enough work or aren't charging enough at 600 i think the second isn't likely.

I sincerely hope you don't get ill - think of the loss your company will incur, will it sue you for lost revenue?

Grow up your running a business and therefore you have to accept that these things happen if you spit the dummy out at every slight complication then you're going to need all the money you can get your hands on to pay for the dummies you'll lose!

[DimPrawn]

Are you lot sticking up for the agency?

I like your tough stance. But reading through it and using common sense I think your claims are a bit unreasonable and your zealous "sue you" outlook rather silly.

At 600/day i'd be all smiles to everyone and milk the gravy train for as long as possible, make no waves, upset no one and invoice like crazy.

Good luck with the contract. Keeeeeeeerrrrrrchhhiiiiiiiiinggggggggg

[malvolio]

Are you lot sticking up for the agency?

God forbid! However, this time it's a variant on the enemy of my enemy is my friend... It's the contractor being silly -I wonder what he does: don't think he's some sort of manager, do you?

[insight14]

Its good of you Phil to give us both sides of the story. Sometimes when you hear a sob-story you can't help wondering how much of the "other" side isn't being told. Unfortunately in your case you've made yourself look a bit of a tit.

Just respond to the agent and have them give you a signed contract with the correct start date. Its not rocket science. Keep the client OUT of any hassle - at £600/day you want renewal after renewal.

[Phil]

Are you lot a bunch of agents in disguise?

The agent screwed up plain and simple. They gave me a contract that was clearly unworkable. I have suffered a financial loss. I missed out on two days at the beginning of the contract (and it's only good luck that it wasn't any longer). To make this up at the end, I'd need to waste two days that could be spent generating revenue for my company on another contract. If I get a load of renewals it's just putting off the problem to a later date.

Why should I pay for the agent's mistake? I had a number of offers on the table when I took this contract and if I'd known the agent hadn't been able to get their side of the contract sorted, I'd have considered one of the others. So if it's possible to sue, I will. I'm sure if I'd done something to cost them £1200, they'd be taking me to court.

[malvolio]

The agent took two days off the start and has put them on the end. Total value of the contract, which is what everyone else is working with, is unchanged. You haven't lost anything, the worst case is you have to do two days at the far end of the contract to replace the two you didn't do at the start.

FFS, you're obviously something senior and you're working in banking. On this evidence, how in God's name did you manage that?

[DimPrawn]

What it really boils down to is if you piss the agent off pursuing this matter, will it affect your relationship with the client to the extent you may not get renewed. Will you be labelled a trouble maker?

Now, if you've got a dozen other clients falling over themselves to hire you at £600+/day, no real issue, go and sue them. I don't think you'll win though.

At best you'll waste time and money. At worst you'll end up looking for work somewhere else.

Your choice, but not working a day and not being paid for it is not really a loss to you is it? Different story if you had worked the two days but the agency refused to pay.