Contract - Early Termination

[expat]

.....
As contractors, we negotiate a higher rate for our services than a permie. We do this to compensate for:
- sick leave;
- holiday pay;
- training;
- being rogered by the taxman;
- the increased risk of early termination.

.....

The compensation is in your rate; you have already had it.

.....

The thing to do now is be really nice to the client. Dish out business cards and say "Thank you for letting me help you. ....."

THREE nuggets of contractor wisdom in one post. Are you sure you're earning your name, Dick?

1. Your rate has to be higher than a salary, to compensate for the items listed, not to mention employer's NIC. It's a business deal, those are the extra things the employer/client is getting (and you are giving up) in that deal. It comes at a price.

2. If you are not getting a high enough rate to compensate for it, then you didn't realise the value of what you were offering: your rate is too low.

3. The only way you'll make more money out of them now is another contract. Don't throw away the chance of that in a fit of pique, at least not without appreciating that that too comes at a cost.

[Pickle2]

I understand that you always have to have a notice period built in but i've been used to honouring my contract and expect the other side to as well. If i'd been told at the start it was 1 months work then rolling week to week after that, I would have perceived the contract

You are getting it all arse about face. The 3 months is the contract maximumn length, not the minimum. As long as they dont kick you offsite with less than a weeks notice, they are EXACTLY honouring the contract.

Sorry if thats not the news you want, but you really need to understand better the terms of business you are operating too if this sort of thing comes as a shock.

[BrilloPad]

Hi
I have just started what i thought was a 6 month contract. The client originally offered a 3 month contract, which I turned down. They then changed it to 6 months, which I agreed to and have since signed a contract with the agency for 6 months.

However, on starting the contract the client has informed me that it is a 3 month contract and then they will either renegotiate the contract or have me go permanent after this time. I don't want to go permanent as the wages would be a lot lower than what I was on in the job that I left. I only accepted the contract because it was 6 months.

I guess there is nothing that I can do as they could get rid of me next week if they wanted to anyway.

If the agency mislead me into thinking that the contract was 6 months when it was only 3 is there anything I can do?

You could go to court claiming that the agent is a lieing cheating slime-ball. But they will say "they are behaving as expected".

[Not So Wise]

If the client had no intension of going the full length of the contract when they signed there would be some legal recourse, but you would need hard documented proof of this and honestly it would not be worth the hassle

[pmeswani]

Hi
I have just started what i thought was a 6 month contract. The client originally offered a 3 month contract, which I turned down. They then changed it to 6 months, which I agreed to and have since signed a contract with the agency for 6 months.

However, on starting the contract the client has informed me that it is a 3 month contract and then they will either renegotiate the contract or have me go permanent after this time. I don't want to go permanent as the wages would be a lot lower than what I was on in the job that I left. I only accepted the contract because it was 6 months.

I guess there is nothing that I can do as they could get rid of me next week if they wanted to anyway.

If the agency mislead me into thinking that the contract was 6 months when it was only 3 is there anything I can do?

Get the client to put it in writing. Print it off and send it to the agency by post asking them to explain why they offered you a 6 month contract when you have been informed it will be a 3 month contract. If you cannot resolve your issue with the agency, seek legal advice and if necessary sue for being in breach of contract. Tell the client of the situation (if appropriate) so that they won't deal with the agency again.

Just out of interest, does the contract offer you the choice of terminating the contract or is it client side only?

[sammy]

thanks for your reply.
it says this in the contract, which i think means that i can terminate if they breached the contract, but i can't terminate it just because I don't want to work there anymore.

Notwithstanding the provisions of Sub-clause (a) hereof, either party may terminate this Agreement forthwith:-

(i) Should the other fail to rectify any breach of this Agreement within 14 days after being given written notice of such breach; or
(ii) Should the other party become insolvent or bankrupt or enter into liquidation; or
(iii) Should either party become unable to perform the Agreement because of an event of ‘force majeure’.

[Lewis]

Get the client to put it in writing. Print it off and send it to the agency by post asking them to explain why they offered you a 6 month contract when you have been informed it will be a 3 month contract. If you cannot resolve your issue with the agency, seek legal advice and if necessary sue for being in breach of contract. Tell the client of the situation (if appropriate) so that they won't deal with the agency again.

Just out of interest, does the contract offer you the choice of terminating the contract or is it client side only?

This is what contracting is like. Just move on. People get given notice here all the time. Often work load is given as a reason but in actual fact the client is not happy with work and/or personality of the contractor but it is easier to say there is no more work or priorities have changed. Also people chose to leave here often. The bank doesn't say "Why did you agree to a 6 month contract and then leave after 3? We're going to seek legal advice". They wish them well and that is it. The contract length means nothing. You can only be guaranteed your notice period.

Legal action will get nowhere and just cause stress all round. Just go and get another contract and forget about it.

[pmeswani]

This is what contracting is like. Just move on. People get given notice here all the time. Often work load is given as a reason but in actual fact the client is not happy with work and/or personality of the contractor but it is easier to say there is no more work or priorities have changed. Also people chose to leave here often. The bank doesn't say "Why did you agree to a 6 month contract and then leave after 3? We're going to seek legal advice". They wish them well and that is it. The contract length means nothing. You can only be guaranteed your notice period.

Legal action will get nowhere and just cause stress all round. Just go and get another contract and forget about it.

I agree with what you are saying in most parts. However, the agency has misrepresented the client here. I know one can leave and move on and the notice period is the only thing is guaranteed... but you wouldn't buy a Merc only to have delivered a Del-Boy Robin Reliant and say "I'll live with it". For all we know, the original poster may have turned down a longer term contract in favour of the one he is in now under false pretence (sp?) from the agency. I suppose taking legal action will not change the circumstances of the fact that the contractor will only be able to carry out 3 months maximum, but the agency has acted inappropriately (and possibly illegally).

[BrilloPad]

I agree with what you are saying in most parts. However, the agency has misrepresented the client here. I know one can leave and move on and the notice period is the only thing is guaranteed... but you wouldn't buy a Merc only to have delivered a Del-Boy Robin Reliant and say "I'll live with it". For all we know, the original poster may have turned down a longer term contract in favour of the one he is in now under false pretence (sp?) from the agency. I suppose taking legal action will not change the circumstances of the fact that the contractor will only be able to carry out 3 months maximum, but the agency has acted inappropriately (and possibly illegally).

but the contract stated Robin Reliant! as contractors we are assumed to have taken legal advice - we are not talking consumer law here.

Sometimes I agree with Mal that certain contractors give the rest of us a bad name.

[The Lone Gunman]

This subject winds me up and some of us are at odds on what out response should be.

I base my rate on a number of things, term of contract being one of them. I am cheaper for a 12 monther than a 6, 6 than a 3 and so on down to being very expensive for 1 day. Much of this is based on set up costs and expected losses on rent and travel.

I think it is reasonable to require some sort of compensation clause for early termination, but that gets us into MOO problems with IR35.