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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10915
Experience:  Solicitor with 5+ years experience
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I own a recruitment business. I have a dispute with a client

Resolved Question:

I own a recruitment business. I have a dispute with a client and they have drawn up an agreement. There are elements of the agreement which I don't think are enforceable in law. The key terms of the agreement include:
For the period of 3 years from the date of this agreement, my business/related parties agree:
(A) not to approach or in any way contact any employee or director of my client in relation to any potential employment or engagement with any alternative employers or organisations irrespective of whether my company would be entitled to a fee as a result of such referral or not; and
(B) my company shall not accept any instruction from any existing employee or director of my client and shall refuse to introduce the individual to any alternative organisations or recommend the individual to the alternative organisation, irrespective of whether my company would have been entitled to a fee as a result of referring the employee or director to the alternative employee or organisation; and
(c) not to introduce, include in any executive search or otherwise recommend any employee or director of my client for any roles or employment with any other organisation irrespective of whether my business would be entitled to any fee as a result if the recommendation.
As I understand it, this agreement prevents me from approaching my clients staff about alternative career opportunities/submitting them to alternative employers. If my clients staff approach me, can I place them or must I refuse to work with them? I can agree not to poach their staff but I do not control their staff approaching me. If I refuse to put their staff forward to alternative employers (when approached) it may be seen as discrimination/a breach of their human rights so is this legally enforceable? Please provide clarification
Submitted: 1 year ago.
Category: Law
Expert:  Ash replied 1 year ago.
Alex Watts :

Hello my name is ***** ***** I will help you with this.

Alex Watts :

Please confirm this is a business to business contract?

Customer: Correct alex
Alex Watts :

Ok. In short its not letting you contact anyone from the Company to work for anyone else, not accept direct instructions or include of those existing employees in current executive searches - all for 3 years.

Customer: What if their staff contact me?
Alex Watts :

You can't stop that.

Alex Watts :

It says not to approach or contact an employee

Customer: i know I can't stop that or control it but if their staff do contact me of apply to our vacancies, can I put them forward to an alternative employer?
Alex Watts :

No I do not think so. Clause C would apply to that

Alex Watts :

However what you may want to consider adding is something to do with industry sector.

Alex Watts :

So if its within the same industry no, but different industry yes

Customer: what if one of their employees brings action against me for refusing to put them forward to a vacancy?
Alex Watts :

If that happens then you have a defence under the contract and indeed could counter sue this client who wants this agreement

Customer: Thank you. The agreement effectively prevents their staff working with me/being appointed by me to alternative employers. Is there any loophole around this?
Alex Watts :

Either not to sign or add a different industry sector clause.

Alex Watts :

It does seem a harsh deal but depends on how much you want to work with this client

Alex Watts :

Can I clarify anything for you about this today please?

Customer: If I do appoint their staff into an alternative employer, what are the consequences?
Alex Watts :

Potentially they could sue you for breach of contract. What exactly their losses will be I dont know.

Alex Watts :

I can't see how they can quantify it

Customer: Is there a legal loophole that could be used which would allow me to appoint their staff by virtue of it not been included in their agreement?
Alex Watts :

I dont think so, clause A is fairly tight. You can't stop people contact you though

Customer: But I could be penalised if I appoint them to another role right? Is there anything a candidate approaching me could do that would facilitate me appointing them to an alternative employer?
Alex Watts :

I am sorry if this is not the answer you want and certainly not the one I want to give you, but I have a duty to be honest.

Alex Watts :

If they approach you, that is nothing you can do about that and you can't be penalised

Alex Watts :

However if you then place them elsewhere, that could be an issue because of clause C

Customer: Is there anything you can recommend I include to mitigate my risk please?
Alex Watts :

Dont sign the contract

Alex Watts :

Or restrict it to this industry sector.

Alex Watts :

If they want to go to different sectors I dont think this should be restricted.

Customer: So I should stipulate it applies specifically to the sector in which my client undertakes work?
Alex Watts :

I would do so, that would be the only thing that could help in this situation

Customer: Or equally I could stipulate it applies to the role a professional is undertaking I.e. If an alternative employer engaged them in a totally different role, this could also work, right?
Alex Watts :

Yes that could too if the client is agreeable to that

Customer: ok, thank you for your advice, you've been very helpful
Alex Watts :

If this does answer your question could I ask you to rate my answer before you go today, the button should be at the bottom of the screen

Alex Watts :

If you need more help please click reply

Customer: Can you email me a transcript of this dialogue please?
Alex Watts :

Once you rate the format of the chat changes so you can print it out or come back to it

Ash, Solicitor
Category: Law
Satisfied Customers: 10915
Experience: Solicitor with 5+ years experience
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