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Opting out -Regulation 32. & Professional Indemnity Insu

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    Opting out -Regulation 32. & Professional Indemnity Insu

    Hi

    I'm relatively new at running my own ltd company (just myself) and am struggling with technical jargon... my brain just shuts down

    I run a ltd company, producing graphics for web/print/video/animation/interactive cd-roms etc. I have registered with various employment agencies, and have had several contracts this way. One agency is asking me if I want to opt out under Regulation 32 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003. I have tried to research this on the internet, but there is so much technical jargon and cross-referencing, that I'm more confused than ever.

    Can anyone tell me in a nutshell, what does opting out mean? Will I lose certain rights, and what are they? What am I opting out of? Please don't tell me to read the regs - I've tried that and I'm just getting confused.

    I have also been told by this agency that I need Professional Indemnity Insurance. I don't see why, as all I do is publish information which my clients ask me to, either in print format, or on the web. Websites I have worked on display client info (as requested by client) and have (at most) basic forms which members of the public need to fill in to request more information. I generally get all clients to proof-read everything and sign it off before it goes live. Coincidentally, this agency offers their own insurance. Hmmm

    Please can anyone help?

    Thanks

    #2
    Opting out means...

    giving up all your rights under the new agency regs. These rights, amongst other things, protects all payments made for your work (makes it illegal to without payments for any reason what so ever).

    The new regs also allow you to go direct with the client without any penalties (and makes restraint of trade clauses even more toothless).

    The regs also mean that agencies MUST pay you, even if they havent been paid themselves.

    Fear not though, you can opt out now BUT before you start at a new clients site you can opt back in.

    Check out www.john.antell.name/article011.htm for a nice overview of the new regs.

    Mailman

    Comment


      #3
      Re: Opting out means...

      So basically, if I opt out, I'm giving the agency the right not to pay me, and I'm also agreeing that an agency/company can restrict where I work, and who I work for in the near futue. Yes?

      So all in all, despite what agencies are telling me, it's NOT a good thing to opt out.

      Comment


        #4
        Re: Opting out means...

        "if I opt out, I'm giving the agency the right not to pay me"

        No, it gives the agency a right to insert a reasonable clause into the contract stipulating the conditions under which the agency won't pay you. Opted in, such a clause would be void. Opt out and you have the right to negotiate such a clause out of the contract if you don't think it reasonable. But if it's not there in the first place then opting in/out makes no difference to your right to be paid for work done (and IME many agents don't have such a clause).

        "I'm also agreeing that an agency/company can restrict where I work, and who I work for in the near futue".

        Much the same. It gives the agency a right to insert a reasonable clause into the contract which you are free to negotiate (and it will only restrict you from not working for the same client for the next N months except through them, this is a long way removed from dictating who you can/can't work for). Opted in, such a restriction will only be valid if N is no longer than the regulation period. Opted in/out the only difference is the quantum, a non compete clause can still be legally valid.

        tim

        Comment


          #5
          Re: Opting out means...

          The agencies would prefer you to opt out as it means less work for them.

          You would be slightly better protected if you opted in.

          Most agencies convince contractors to opt out.

          Comment


            #6
            Re: Opting out means...

            No, it gives the agency a right to insert a reasonable clause into the contract stipulating the conditions under which the agency won't pay you. Opted in, such a clause would be void. Opt out and you have the right to negotiate such a clause out of the contract if you don't think it reasonable. But if it's not there in the first place then opting in/out makes no difference to your right to be paid for work done (and IME many agents don't have such a clause).
            This is incorrect. Penalty clauses in contracts are unenforceable, even if you opt out. I took legal advice on this before signing my new contract and got the agents to remove the clause from my contract.

            However just because a clause is unenforceable doesnt mean agents wont try it on with you. If you are opted in you just have another la4er of protection from such dodgy practices.

            Much the same. It gives the agency a right to insert a reasonable clause into the contract which you are free to negotiate (and it will only restrict you from not working for the same client for the next N months except through them, this is a long way removed from dictating who you can/can't work for). Opted in, such a restriction will only be valid if N is no longer than the regulation period. Opted in/out the only difference is the quantum, a non compete clause can still be legally valid.
            Another incorrect assumption.

            Restraint of trade clauses are unenforceable (unless you are in a multiple hundred thousand pound position...then expect a fight).

            Generally...restraint of trade clauses are so poorly written you could drive trucks through them...especially when they are non-site specific and specify that you cannot work with anyone or any other business that you may have come in to contact with during the term of your contract.

            This term is even more toothless when its a non-solicitation clause because the onus falls on the agents to prove that they have been done out of something that they consider to be rightfully theirs. They would have to prove that you went to the client looking for work when most likely the client came to you to ask you to stay on.

            All this is from experience and having to engage lawyers to deal to dodgy agents

            Regards

            Mailman

            Comment


              #7
              Re: Opting out means...

              I never said such clauses were necessarily enforceable.

              I said that they had the right to insert them in the contract and that instead of being automatically void you had the right to negotiate them out (or not) if you wished.

              And this is precisely the point.

              On these particular points, the difference between being opted in or opted out is the difference between the clause being automatically void or choosing between (a) you accepting them in the contract as reasonable (I personally have no issue with a six month non-compete clause cos if it wasn't there agents would just up their margins) (b) you negotiating them out as completely unacceptable (like the waiting until we get paid clause) (c) living with them because they aren't going to happen (just how often does someone not get a signed timesheet?) (d) reluctantly accepting them, hoping that they might not be enforceable if it happens (which the signed timesheet one probably isn't anyway).

              I see this difference as tiny and not worth bothering with, you seem to see it as an earth-shattering problem?

              And per the restraint of trade. Agreed, a restraint of trade is unenforceable. The unresolved question is, "is a restriction on not working for one stated employer (the current one), for a short period after you have left (6 months), except on the same terms as the ones that were in force when you left (i.e through the same agents, for the same rate) a restraint of trade". Legal view is that it isn't. This does not mean that all non-compete clauses are valid as many try to go much further but ISTM that one that just does the above, is enforceable and not unreasonable (for the already stated reason).

              tim

              Comment


                #8
                Re: Opting out means...

                It all depends on how the clause is worded and currently most restraint of trade clauses are so poorly written they should be on some kind of government hand out

                Even then under a non-compete clause its still up to the agents to PROVE that they have suffered a loss. They would have to prove that a business relationship existed prior to your engagement and that their IP is also being used by you. Two things that 99 out of 100 times they wont be able to prove.

                Also...you know and I know and the agents know restraint of trade clauses are unenforceable YET they continue to insist on such clauses being in contracts. The feeling I have is that they put these there as part of their scare tactics.

                Regards

                Mailman

                Comment

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