Frankly, the agency is wrong. Employer's NIC is the liability of the employer. If you are an employee of the agency, then they are responsible for the Employer NIC.
If you operated though your own limited company, provided you were IR35 compliant, you could limit your salary so as to pay no employee NIC or employer NIC and draw income in the form of dividends which are not liable to NIC.
The agency doesn't want the responsibility of being an employer. They should be honest and say that the day rate for employees is less than for those who operate through their own limited company.
I hope this helps but let em know if you have any further questions.
Hi.I'm just following up to find out if my answer helped or if you have any further questions.