Going direct

[xara]

Current contract: there's an end-client, a consultancy, an agency, and my ltd.

Because of a bust-up, the end-client refuses to work with the consultancy in future. Even if rates are lowered. They would like to work with my ltd instead and are offering to do so via a different agency that the pm knows.

My ltd has a handcuff clause with the original agency, probably exceeding the likely amount of work in prospect.

Is there anything that can be done here? I suppose everyone could keep schtumm, but if there's an IR35 investigation, or HMRC bring in some rules for greater transparency, that won't help.

[northernladuk]

We've a million postsnon here covering handcuffs and this exact situation so a quick search would have found your answer and many other discussion points worth considering.

In a nutshell the handcuff can't be invoked as there is no more work to be done here. The handcuff is there to protect the agents revenue stream. If the client won't work the consultancy doesn't need the agency who don't need you. No one is making money so no one will lose it if you go to the new setup so should be fine.

I assume you've been given notice and been told you aren't required anymore?

Not sure why you are bringing IR35 in to it but this is perfect for you as you've been binned off early helping prove you are a business. But forget IR35 for the moment.

[xara]

We've a million postsnon here covering handcuffs and this exact situation so a quick search would have found your answer and many other discussion points worth considering.

In a nutshell the handcuff can't be invoked as there is no more work to be done here. The handcuff is there to protect the agents revenue stream. If the client won't work the consultancy doesn't need the agency who don't need you. No one is making money so no one will lose it if you go to the new setup so should be fine.

I assume you've been given notice and been told you aren't required anymore?

Not sure why you are bringing IR35 in to it but this is perfect for you as you've been binned off early helping prove you are a business. But forget IR35 for the moment.

Thanks, I did have a search, and came away with the conclusion that I was a) a bit stuffed because of a handcuff clause b) possibly unstuffed because of the bust-up between the end-client and consultancy.

Is it necessary to formalise the bust-up in some way? I don't think the end-client would come out and say 'we don't want to work with consultancy x' any more; it was somewhat personal and due to some particulars of this specific deal.

The contract will be expiring but notice could also be formalised. I am just wondering if it somehow needs to be recorded/made very clear that they won't work with the consultancy.

I should add: the end-client would prefer to keep silent. But your post implies that everything should be done in the open.

[northernladuk]

You are only bothered what the agent says as that is who your contract is with. If its clear to all parties the agent can't get any more revenue form this and is ending your contract then you are fine. It's only them the handcuff is with.

[BlasterBates]

Thanks, I did have a search, and came away with the conclusion that I was a) a bit stuffed because of a handcuff clause b) possibly unstuffed because of the bust-up between the end-client and consultancy.

Is it necessary to formalise the bust-up in some way? I don't think the end-client would come out and say 'we don't want to work with consultancy x' any more; it was somewhat personal and due to some particulars of this specific deal.

The contract will be expiring but notice could also be formalised. I am just wondering if it somehow needs to be recorded/made very clear that they won't work with the consultancy.

I should add: the end-client would prefer to keep silent. But your post implies that everything should be done in the open.

I would suggest you get confirmation that your services won't be required. Once you have that you shouldn't have to worry, as it would then be clear that you are not responsible for them losing a contract.

[GhostofTarbera]

I would suggest you get confirmation that your services won't be required. Once you have that you shouldn't have to worry, as it would then be clear that you are not responsible for them losing a contract.

And hope the agent pay your final invoice when they find out


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[LondonManc]

You are only bothered what the agent says as that is who your contract is with. If its clear to all parties the agent can't get any more revenue form this and is ending your contract then you are fine. It's only them the handcuff is with.

Be careful here, you can't just give out the advice that you have on this thread.

If OP is currently Client Co - Consultancy - Agency 1 - OP Ltd and is looking at going:
Client - Agency 2 - OP Ltd, they need to be VERY careful that Agency 2 is not on Client Co's PSL. If they are, there could be an issue.

Personally, I would get the PM to check if Agency 2 are on the PSL first. If they are, then get PM to talk to OP's agent and say that they'd like to engage client direct now that they cannot via the consultancy. Only then if Agency 2 are not on the PSL can they go straight to Agency 2.

Whoever they go with, new contract, fixed rate of x per day for agency because there's no search costs involved. OP should get an extra boost on their day rate because they're cutting out the consultancy and it will still be less than Client Co were charging.

[northernladuk]

Be careful here, you can't just give out the advice that you have on this thread.

Indeed but we've done it so many times I couldn't be bothered going in the detail again.

[LondonManc]

Indeed but we've done it so many times I couldn't be bothered going in the detail again.

Key difference here is that the OP could indeed get stung by Agency 1 because they could still provide that service. One extra step to the usual "fill yer boots" answer.

[Sub]

Current contract: there's an end-client, a consultancy, an agency, and my ltd.

Because of a bust-up, the end-client refuses to work with the consultancy in future. Even if rates are lowered. They would like to work with my ltd instead and are offering to do so via a different agency that the pm knows.

My ltd has a handcuff clause with the original agency, probably exceeding the likely amount of work in prospect.

Is there anything that can be done here? I suppose everyone could keep schtumm, but if there's an IR35 investigation, or HMRC bring in some rules for greater transparency, that won't help.

Does the handcuff clause wording covering your relationship with the end-client? That would be the key.

It is not uncommon that agency contract restricting you working for a client mentioned in the contract which in your case probably be the consultancy; In this case (if end-client is not covered in your agency contract) you are fine going direct regardless if current agency is capable to supply yourself to the end-client or not.

Having said that, there is another side of the story, when consultancy may raise some sort of dispute with end-client about poaching staff etc. Been there couple of times, both times came and went without any issues.