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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10916
Experience:  Solicitor with 5+ years experience
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Good morning We have been invoiced by a labour agency for

Resolved Question:

Good morning
We have been invoiced by a labour agency for some employees who left the agency and started work directly for our company, this is in breach of our contract with the agency.
We note that the agency are allowed to charge our company a reasonable fee. The terms of the contract state that the agency can charge 300 hours at the contracted rate. We do not feel that this is a reasonable amount and that the difference between the rate charges to our company and paid to the agency worker would be a reasonable fee. Please could you advise where we stand in this matter
Regards
Simon Hill
Submitted: 2 years ago.
Category: Law
Expert:  Ash replied 2 years ago.
Alex Watts :

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

Alex Watts :

If the contract said they could charge 300 hours, why did you sign it please?

Customer:

I didn't, one of our employees did unfortuanatly

Customer:

Hi Alex

Customer:

Hi Alex, I think the fact I did not sign the contract may be important here, I am the sole director of the company and only I can sign contracts for our company. The member of staff signed the contract in my absence and without my authority.

Alex Watts :

Ok - but the member of staff was working for you and on behalf of the company?

Alex Watts :

How much is the proposed fee please?

Customer:

He was working for our company but has no authority to sign contracts, this is in his contract. They may assume he has apparent authority but surely contestable.

Customer:

They have issued county court proceedings, the total sum id for £20000.00. They are claiming for four people, two of these did start for the agency and then came over to us apparently although I was not aware. We do not believe that the agency sent the other two they are claiming for as they never invoiced us for them. My two points would be that we do not recognise the contract as it has not been signed by a director of the company and that the money they are claiming is unreasonable.

Alex Watts :

Does the contract say it has to be signed by a Director?

Customer:

No it does not

Alex Watts :

Someone in your organisation though hired them, is that correct?

Customer:

Yes, somebody in our organisation hired the men for the project

Alex Watts :

Thanks. Its bad news I am afraid. If the contract did not say it had to be signed by a Director and it was signed by one of your employees. sadly your company is vicariously liable.

Alex Watts :

The law states the Company is responsible for employee wrongs.

Alex Watts :

However it will be open to you, to defend the proceedings on the basis that the fee is not reasonable.

Alex Watts :

Indeed you can claim that it amounts to a penalty.

Alex Watts :

The Court has the power to amend or delete parts of an agreement.

Alex Watts :

You need to convince the Court that this is a too high a fee and does not reflect the work done.

Alex Watts :

Indeed they would only be entitled to charge at the very most, loss of profit.

Alex Watts :

The Sale of Goods Act states that someone is entitled to a reasonable fee for reasonable work done

Alex Watts :

Clearly this is not reasonable and you can defend the claim on this basis

Alex Watts :

But from what you have said I do not think you can argue that it is not valid because it was not signed by a Director for the reasons above.

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 :

But you can defend because it is extortionate.

Alex Watts :

Can I clarify anything for you about this today please?

Customer:

No, thanks for your help. I will approach them and tell them that we will defend against their case on the basis of the costs being unreasonable. I will also offer to pay for their loss of profit on them men. Thanks again

Alex Watts :

Happy to help - do you need anything else from me today?

Customer:

No thanks. Have a nice evening

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