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Ben Jones
Ben Jones, UK Lawyer
Category: Employment Law
Satisfied Customers: 47367
Experience:  Qualified Employment Solicitor - Please start your question with 'For Ben Jones'
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Hi, I am a computer software developer. I work through an

Resolved Question:

Hi,
I am a computer software developer. I work through an agency with a consultancy under contract.
My agency placed me with the consultancy in October 2011 to work for an end client.
The contract was renewed every 3 to 9 months to make a continuous period of work up till 31 December 2013.
My agency informed me in December that a renewal was being offered up to the end of June 2014. By January we were still waiting for the paperwork to confirm the contract extension.
The consultancy were keen for me to continue working for them, but the agency were renegotiating the terms of the contract, which the consultancy did not agree with.
I continued working on site through January into February without a contract. The consultancy assured me that I would be paid, but be patient. The agency kept blaming the consultancy for not replying to their enquiries.
The project was nearing completion, and the consultancy asked me to move to a different project in Germany.
The consultancy want me to continue working with them, but do not want to do any more business with the agency. The agency have asked another company to bill on their behalf, which the consultancy do not want to pay.
My original contract with the agency has a clause preventing me from working with the consultancy or the end client direct without the permission of the agency for a period of 1 year.
In the meanwhile I have paid hotel bills and flights, without any invoices being settled on my behalf.
It seems the agency have been intransigent in renegotiating terms with the consultancy.
I should say that there are several others contracted by the consultancy through the same agency, but my contract was the only one that has fallen due for renewal so far.
Is there any way that I can take up the offer by the consultancy to continue working with them direct?
Thanks
Tony
Submitted: 3 years ago.
Category: Employment Law
Expert:  Ben Jones replied 3 years ago.

Ben Jones :

Hello, my name is XXXXX XXXXX it is my pleasure to assist you with your question today. are the agency asking for a finders fee

Customer:

No they are trying to continue to bill through a third party company

Ben Jones :

OK thank you, XXXXX XXXXX it with me. I need to look up a few things and then get my advice ready. I will post back on here when done. There is no need to wait and you will receive an email when I have responded.

Customer:

OK thank you

Ben Jones :

Many thanks for your patience. Employment agencies have traditionally been eager to protect the revenue they get from supplying temporary workers to end user clients. They normally do so by including certain "restrictive covenants" or clauses within their contracts to either prevent a contractor from taking up direct employment with an end user, usually for the duration of the contract plus an extended period after termination, or which imposes a substantial fee if they do. The civil courts have on many occasions deliberated whether such "restrictive covenants" are fair and reasonable and there is still no single definitive answer.


 


Under UK and EU legislation there have been attempts to allow workers to seek employment wherever they choose, without restriction, thus removing any restraint of trade prohibitions. There are still times, however, when the agency could try and enforce such a restriction and that is when they can show that their legitimate business interests may be affected. There are three areas where the agency might have such interests and these are confidential information, trade secrets and business connections.


 


It is the last one that would be most relevant where the agency may claim that you are infringing on its business connections by going to work directly with the client, bypassing the agency.


 


Whilst restrictive covenants are mainly used as a scare tactic by companies, if an employee has acted in breach of a covenant and the employer is intent on pursuing the matter further they can do so. The following are potential outcomes if the employer takes legal action:



  • Obtain an interim injunction preventing the employee from doing certain things that would make them in breach of the restrictive covenant

  • Seek compensation for damages that have directly resulted from the breach of the covenants


 


As you can see there are no hard and fast rules on restrictive covenants. Whether a specific restriction is enforceable will always depend on the individual circumstances, the interest being protected and whether it has been reasonably drafted. The above principles are what the courts will consider when deciding whether a restriction is going to be legally enforceable. It should give you a good idea of what to look for in your situation and decide what the chances of this being pursued further are.

Customer:

Thanks Ben,

Customer:

That states the problem exactly, and it appears that the interpretation of the law is ambiguous. I have sent all parties an email stating that, as I have not been paid by the agency within the 30 days promised in the expired contract (it is now 45 days and counting), I shall consider them in breach of the contract unless I am paid in full by Friday next week.

Ben Jones :

You may certainly use that non-payment as an argument they have acted in breach of contract and then try to state that the contract then becomes void, taking the restrictions with it at the same time

Customer:

OK Ben, thanks you for your help.

Ben Jones :

You are most welcome, all the best

Customer:

Thank you, XXXXX XXXXX

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