Agency Changes.

[Farmer jones]

Opion sought about approach to this scenario, and particularly those who have experienced it..

I'm contracting for an agncy who is being taken off the clients preffered suppliers list.

The client has another preffered agency as supplier.

My contract has around 6 months to run, (and the client already wants to re-new).

There's the usual 6 month no poaching clause in the contract my Ltd Company has with the existing (and out going agency).

I want to carry on working on the client's site, and they want me to carry on. (A case of the bean counters changing things with consulting or factoring in impacts...anyway).

I can see a number of options:

1. Job ship & sign up with new prefferd agency (but with the risk of outgoing agency trying it on with the clause).

2. Collapse existing Ltd company, start a new Ltd Company, and sign up with new preffered agency.

3. Similar as 1 & 2 but with additional layer of 3rd party provider into client.

4. Going direct maybe an option (but will require careful negotiation but doesn't really look viable).

5. Take 6 - 12 months off & come back...err no.

So any other ideas, or things I should consider ?

Cheers

FJ

[blacjac]

1.

The agency might try it on but they really don't have a leg to stand on. Those clauses are to protect the agency against loss of income from the contractor switching to work through another agent. However, as the client won't work with the agency any more there is no loss of income from the contractor working with another agency.

[kal]

1.

The agency might try it on but they really don't have a leg to stand on. Those clauses are to protect the agency against loss of income from the contractor switching to work through another agent. However, as the client won't work with the agency any more there is no loss of income from the contractor working with another agency.

WHS surely if they tried it on one could claim restraint of trade, just because a clause is in a contract it doesn't automatically make it legal...

[northernladuk]

Old agency can only hold you to a handcuff if they can prove they will lose out which they won't if the client won't deal with them. They cannot stop you working for no reason.

Shutting a company down to avoid a contract clause will not work by the way.

[DirtyDog]

1. Job ship & sign up with new prefferd agency (but with the risk of outgoing agency trying it on with the clause).

Old agency can threaten, but are unlikely to do much about it. The client would need to check their contract with the agency to see whether they may get hit for taking your company on via another route.

2. Collapse existing Ltd company, start a new Ltd Company, and sign up with new preffered agency.

Won't work.

3. Similar as 1 & 2 but with additional layer of 3rd party provider into client.

Not sure what you mean by that one.

4. Going direct maybe an option (but will require careful negotiation but doesn't really look viable).

No different from the first one - again, client needs to check their contract with the agency. Plus, if the client is bent on getting you to change agency, why wouldn't they take you direct instead at the same time?

5. Take 6 - 12 months off & come back...err no.

That would work.

So any other ideas, or things I should consider ?

Keep working via old agency. Old agency contracts with new agency. New agency contracts with client. Obviously there's now an additional link in the chain taking some money, so you'd need to either absorb those costs yourself or pass those on to the client.

[cojak]

Opion sought about approach to this scenario, and particularly those who have experienced it..

I'm contracting for an agncy who is being taken off the clients preffered suppliers list.

The client has another preffered agency as supplier.

My contract has around 6 months to run, (and the client already wants to re-new).

There's the usual 6 month no poaching clause in the contract my Ltd Company has with the existing (and out going agency).

I want to carry on working on the client's site, and they want me to carry on. (A case of the bean counters changing things with consulting or factoring in impacts...anyway).

I can see a number of options:

1. Job ship & sign up with new prefferd agency (but with the risk of outgoing agency trying it on with the clause).

2. Collapse existing Ltd company, start a new Ltd Company, and sign up with new preffered agency.

3. Similar as 1 & 2 but with additional layer of 3rd party provider into client.

4. Going direct maybe an option (but will require careful negotiation but doesn't really look viable).

5. Take 6 - 12 months off & come back...err no.

So any other ideas, or things I should consider ?

Cheers

FJ

Get the client to bully the agency to drop the claim for damages on the clause.

Worked for me.

[Boney M]

Select the agency off of the preferred suppliers list and move over.

\Thread

[craig1]

I've seen this a couple of times in the past, the preferred situation is for the client to either arrange a run-off of existing contractors until you're out the door or buy out the handcuff period. The contractor to agency contract is not the client's problem, they'll have their agency to client contract that may already have everything like this covered. For example, it's a rare agency to client contract that doesn't have terms setting out how much the client will have to pay the agency to turn a contractor into a permie, some also have end-of-service and run-off clauses.

[northernladuk]

I've seen this a couple of times in the past, the preferred situation is for the client to either arrange a run-off of existing contractors until you're out the door or buy out the handcuff period. The contractor to agency contract is not the client's problem, they'll have their agency to client contract that may already have everything like this covered. For example, it's a rare agency to client contract that doesn't have terms setting out how much the client will have to pay the agency to turn a contractor into a permie, some also have end-of-service and run-off clauses.

I would argue that the agent to contractor contract is the clients problem if he needs that guy and has work that needs doing.

[craig1]

I would argue that the agent to contractor contract is the clients problem if he needs that guy and has work that needs doing.

There is that but you'd expect that the master agent to client contract would cover that issue. Either that or the agent to client negotiations will cover it. It'd have to be a pretty negligent client that didn't have a complete agreement freeing the contractor from constraint if they agreed a handover of contractors to another agency.

Even then, the most likely scenario is run-off. Most agency to client problems are at the recruitment end rather than ongoing service end, if that's the case here then you'd think there would be few problems in allowing a run-off.

The one time I was actually involved in setting up such a run-off, we had to agree a margin freeze for the remaining contractors to allow contractors to negotiate their own rate rises with us directly at renewal leaving the agency as nothing more than an invoice processor and not allowed in the door again.