Clause in contract

[radish2008]

Thanks for the answers everbody I will search a little more in depth in the next few days. It doesnt actually state what the fee will be or the %.

The reason I am keen to go direct, is that the workload may be a lesser the near future, the client I work for does only fixed price work, therefore anything they save on paying me is extra profit to them (its a small company). I have said to he client I am happy for them to keep the savings and I will take a further reduction in pay.

To Prozak, the agency has gotten their % from me for a year, so I would say they have done ok out of me.
Thanks again everybody

I'm normally not a fan of hand cuff clauses but in this case I'll make an exception. If you left and then returned 9 months later I'd probably say it was unenforceable but you're colluding with THEIR client to cost them money. If they have any sense they will sue and win.

They have the relationship with the client, not you. You work for the agency, not for the client.

And it doesn't matter how much money they have made out of you.

As for reducing their fees and letting them keep the extra profit I don't know where to start. You remind me of a guy I once knew who breached a permie notice clause to become a contractor - they sued him and he settled out of court for £20k.

[Lance]

I have a contract between myself and a client through an agency. One of the clauses in the contract is that I may not provide services to the client either directly or indirect for a period of 12 months after the currect contract terminates. If I do supply services to the client not through the agency, then the agency will be entitled to charge the client a fee.

Are you sure you've got that bit right?
That suggests that if you go direct the agency will come after the client not you. On that basis fill yer boots as it's not your problem.

I think you have almost certainly misquoted the clause though.

[northernladuk]

Handcuff clauses can't be too generic and all encompassing. If they are they'll fall foul of some restraint of work rule or something. 12 months is definitely too long and as someone mentioned before it is very likely it wouldn't stand up after 9 months.

The problem here is the handcuff is to protect the agencies business. The law always favours the party that can prove loss and in your situation this couldn't be clearer. It doesn't matter if the timescales or terms are a bit wooly, you would be causing the agency to lose money so it's pretty black and white. It would stand.

It wouldn't get to court though. The agency would cause such a stink the client will drop you like a stone instead of getting involved or the client and the agency can come to an agreement. Thankfully the latter happens nearly all of the time. If it's really what you want and the client also wants it it is up to them to strong arm or negotiate with the agency. You are squarely caught by the handcuff. There is no way around it from you. It's up to the client and the agency to work it out.

[Lance]

Handcuff clauses can't be too generic and all encompassing. If they are they'll fall foul of some restraint of work rule or something. 12 months is definitely too long and as someone mentioned before it is very likely it wouldn't stand up after 9 months.

This is all very good for permies but does it hold true for businesses? I’m not so sure.

[northernladuk]

This is all very good for permies but does it hold true for businesses? I’m not so sure.

Even more so for business with so much money involved as well as IP.

[NotAllThere]

...You remind me of a guy I once knew who breached a permie notice clause to become a contractor - they sued him and he settled out of court for £20k.

Really? In the UK? I'm rather skeptical because under UK law I know from experience it's quite difficult to enforce a notice period on an employee. Perhaps there was more to it than simply not giving notice.

[WordIsBond]

Well, if the penalty isn't defined in OP's contract, then it probably is to paid by the client and is defined in the client's contract with the agency. In which case, it is the client's problem.

OP, you should read this very carefully, and if it really doesn't specify the amount to be paid, and if it really does say that they will be paid a fee by the client, then it simply isn't your problem. IF, and only if, that is the case, tell the client what your contract says, and that you are glad to work for them at the rate the agent has been paying you, but it is up to them to make any arrangements with the agent that their contract requires.

You have to think about payment terms a lot more carefully when you go direct, though. Something to remember.

Some people on this forum seem to struggle with actually reading what is said and considering the possibility that the OP's contract / situation might differ somewhat from their own experience. It's not actually that strange for an agency to word contracts so that they recover from the client rather than the contractor. Clients usually have deeper pockets and are more likely to just pay up rather than try to fight it, so it makes all the sense in the world for agents to structure it that the client would pay handcuff fees.

[PurpleGorilla]

I had a 3 month clause, so waited 3 months and then hooked up direct for a bit of ad hock.

[radish2008]

Really? In the UK? I'm rather skeptical because under UK law I know from experience it's quite difficult to enforce a notice period on an employee. Perhaps there was more to it than simply not giving notice.

Yep. They got a contractor in to quote for 3 months work and put that forward as their fiscal loss. The guy settled out of court. He then went on to get sued by his next client for jumping ship.

[radish2008]

I had a 3 month clause, so waited 3 months and then hooked up direct for a bit of ad hock.

I also had a contract through Modis and then went direct - everyone was up front and I think the client ended up paying £50 a week or something for 3 months. But to agree with the point made above the contract stated it was between the client and the agency and I left them to it.