Employment agency issues – My Limited company might lose a contract. – Page 2 – Chat Forum

the00 · 2015-07-23T11:39:15Z

About 6 months ago I was in permanent employment, but was sent an email from a recruitment agency advertising a contract role for one of their ‘clients’. The role sounded a perfect fit for me, and I had thought of going contract for a while. I suspected that the client was a company that I knew, and I’d done work for them before through a previous company. So I sent off my CV to the recruitment company. They liked it, and sent it on to their ‘client’. They liked the CV and wanted to arrange an interview. At this point the day rate was discussed. I asked for X, which I wanted to use as a jumping off point. The feedback I received from the recruitment company was that the rate was too ambitious. They offered Y, which I was happy with. I went to the interview. They liked me, but said that the day rate quoted was too high. They asked if I had discussed this with the recruitment company. I confirmed that we had, and that we had agreed on Y. The client said that they were still being quoted X. I left the interview, gave feedback to the recruitment company, and was hopeful that something would get sorted. The recruitment company sent over a contract for me to review. Next I was contacted by the my interviewer, saying that they wanted to take me on, but that they had no relationship with the introducing recruitment company (despite the recruitment company claiming that they were clients), and due to their protracted purchasing system it would be hard to set this up. He asked if I had any agreement with the employment agency, and I said I had nothing signed. It was suggested that I could go through another agency, let’s say agency B. We both agreed to stop communications with recruitment company A, I got a contract through company B, and I’ve been on contract for 5 months now. Recruitment company B get a flat rate fee per day for managing my contract and paying my Limited company. However… Recruitment company A have found out that I’ve been taken on, and are now pursuing the client company for costs. In hindsight both the interviewer and I have over-simplified our relationship with recruitment company A. Although no agreements have been signed, we have used their services up to the point of interview. We have replied to emails with footers that refer to ‘terms and conditions available on request’. Recruitment company A have made two offers: • A flat fee equal to the whole value of my initial contract. Y x ~90 days. This would effectively double the cost of my initial contract to the client, as is therefore very expensive. • A rate per day worked equal to the difference between my initial day rate offer (X) , and what I now get (Y). X – Y = Z per day. For the initial contract period this is about ¼ of the first option, but this cost would be ongoing if my contract were to be renewed. This figure is about 5 times as much as recruitment company B is getting, and what the client would realistically expect to pay. So now my contract is up for renewal, and although the client is happy with my performance, the involvement of recruitment company A is a headache for them, and a worry to me. So far they have discussed the following options: 1. Accept offer 1 – very expensive, but draws a line under the issue. 2. Accept offer 2 – less expensive for the initial contract, but comparatively expensive if the contract is renewed. It is my worry that this will lead to me losing my contract. 3. Ignore recruitment company A, and let their large legal team sort it out. 4. Negotiate something between offer 1 and 2 that draws a line under the issue. I understand that I have been a bit naive to get in this situation in the first place. I was led by the client and the desire to win my first contract. The client clearly initiated the mistake in using the services of recruitment company A without a formal agreement, and then ignoring this when giving me a contract through company B. They have the financial liability, but I might lose my contract because of it. Is there anything my client can do to limit their financial liability? Is there anything I can do to make it more likely that my contract can be renewed without a financial penalty to me client? Is this employment law or contract law? Any advice?

lunge

Posts: 13513

Full Member

Something to think about, agency A were only engaged with as they got someone that agency B couldn't, someone better, the OP, that has to be worth a few quid. I think that both the company and agency A behaved a tad questionabley though not in a way that is uncommon. I also think that irrelevant if you think agent A should get s fee, agent B sure as hell shouldn't.

And as someone who has been both hirer and recruiter, on both sides of this conundrum I feel I pro am speak with a bit more knowledge on this subject than most.

Posted : 23/07/2015 9:04 pm

squin

Posts: 0

Free Member

There is no ownership of client.

Look at it another way, if they hadn't have made the introduction, the client or op would not have received benefit.

By agreeing to the interview, all concerned agreed terms - regardless of how the initial introduction was made. If this had all ended well, the client and op would have been delighted the the agency made this sort of approach.

There is no misrepresentation once they've all agreed to an interview (in this example).

Posted : 23/07/2015 9:04 pm

squin

Posts: 0

Free Member

Again, lunge is correct.

I don't totally believe that the op and the client didn't know what was happening or the implications of 'back-dooring' this contract, but let's put it down to experience. Lesson learned.

Posted : 23/07/2015 9:08 pm

lunge

Posts: 13513

Full Member

Was thinking about this last night and I think one of the big things people are forgetting is that the OP was found by Agency A and not Agency B. Those suggesting that they should just get the same person (or using an analogy of the same product) from Agency B forget that they can't, only Agency A contacted him, got him to interview, got him through the process.

This is why Agency A should get paid, they used their expertise to find a candidate, contact him and market him to a company who they knew would like him, they did this so well that they got an interview and then a placement out of it. The OP got a job he wanted at a rate he was happy with, Agency A got a fee, the client got the right man, all was well in the world.

Posted : 24/07/2015 8:31 am

Del

Posts: 8278

Full Member

Hmmm, sounds like most of the other underhand things STW's seem to encourage. Estate agent markets your house, STW'r tries to get out of it by not paying them type of thing.

except that overwhelmingly the consensus on this thread does not bear that out. 🙄

Posted : 24/07/2015 8:52 am

konabunny

Posts: 0

Free Member

this is not employment law

a contract is not only a signed piece of paper with "contract" written on it

3. Ignore recruitment company A, and let their large legal team sort it out.
4. Negotiate something between offer 1 and 2 that draws a line under the issue.

options 3) and 4) are the same thing

Posted : 24/07/2015 11:29 pm

pjm84

Posts: 0

Free Member

I would be prepared to suggest that the agency have a 99% chance of success in a court.

I would agree.

Posted : 24/07/2015 11:39 pm

PaulGillespie

Posts: 0

Free Member

OP, you're setup as a limited company? Wind it up and set up a new ltd company. Problem then stops for you and is between A and client and will be in relation to A recouping historical costs for a contract that has now ceased.

Posted : 25/07/2015 11:03 am

konabunny

Posts: 0

Free Member

that's absolutely watertight legal advice and nothing could go wrong with it

Posted : 25/07/2015 1:33 pm

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