Agency added completion payment clause negligently without client knowledge

[Status500OK]

@northernladuk thanks, there is nothing more sobering than a dose of reality - analysed in great detail. much appreciated

@WTFH damn, at that rate, I chose the wrong profession

[WordIsBond]

Legally, your case isn't very strong unless you can prove you've actually suffered loss. You say you passed on other contracts that paid better. Do you have proof of better-paying offers? If so, your loss is the lesser of two figures: 1) the expected bonus 2) the difference between what you have received and what you can prove you would have received in a different contract. The loss of a potential contract is worth nothing, but if you actually had an offer of a better contract that you turned down, I suspect a court would not be particularly approving of their behaviour. They offered and wrote into the contract something that created an expectation when there was no possibility of that expectation being fulfilled. That's simply not appropriate, but you have to be able to prove loss, and if there was no other firm contract offer, you can't prove it.

So yes, there could be a legal case here. I disagree with those who said there is no case. Whether it is worth it is another matter, I doubt it is. The cost and hassle of it probably isn't worth it.

Morally, their position is reprehensible. They made an offer with a provision which was lucrative for other contractors, therefore creating an expectation for you, but it was never going to be beneficial to you, and they knew that when they made the offer. You might tell them you are considering walking and will never work with them again after this contract.

Reading between the lines, £10K is about £1.5K / month over seven months. So if that's 15%, then the contract is somewhere around £10K / month without this completion payment? Of course £10K is significant money, but do you want to mess up a £10K / month contract over it? And it isn't £10K, it's £8K, since they've offered £2K.

If you had a firm contract offer you passed, I'd likely take it to them and say, 'This is what I passed on because of this.' They do have some room to negotiate here, they've been clearing at least £1K a month out of this contract, and I doubt they are taking less than 10%. They probably can't very well cover the full £10K, though, but you might get another £1-2K out of them if you can prove you've suffered loss. To get more than that you might have to go to court, and it won't be worth it.

If you can't prove (with evidence of another offer) that you've suffered loss, I'd just take the £2K, keep my head down, wow the client, earn a renewal, and then expect a nice increase. If asked why, you can say that you've been working below your normal rate because of an expectation of a completion payment, and you aren't willing to do that anymore. If they or the client can't come up with some more money, you are gone.

If you are mad enough, find another contract. Everybody knows you've not been treated well. The agent is going to get the blame on this one, if you aren't a jerk when leaving.

[Status500OK]

@WordIsBond many thanks for your advice and analysis of situation. As you suggested the hassle to take the agency to the court would not have been worth it.

I decided to draw a line and handed in my 4 weeks' notice and shamed them enough that they released me from non-compete clause - so the client can potentially directly contract my services.

I just may enjoy some sunshine this summer

[ComplianceLady]

But he is assuming 15% of invoice value based on what other contractors have received, the contract didn't set out a value and the client obviously didn't state a value so they haven't offered anything as part of the contrct - they offered an entirely discretionary bonus. They could have that in the standard contract without the clients being aware of it and use it for some clients and not others - it in no way sets n expectation, unless there's something beyond what's in the contract.And they are offering 2k - so they've entirely fulfilled the expectation they set out, a possible bonus at an entirely discretionary amount.

Legally, your case isn't very strong unless you can prove you've actually suffered loss. You say you passed on other contracts that paid better. Do you have proof of better-paying offers? If so, your loss is the lesser of two figures: 1) the expected bonus 2) the difference between what you have received and what you can prove you would have received in a different contract. The loss of a potential contract is worth nothing, but if you actually had an offer of a better contract that you turned down, I suspect a court would not be particularly approving of their behaviour. They offered and wrote into the contract something that created an expectation when there was no possibility of that expectation being fulfilled. That's simply not appropriate, but you have to be able to prove loss, and if there was no other firm contract offer, you can't prove it.

So yes, there could be a legal case here. I disagree with those who said there is no case. Whether it is worth it is another matter, I doubt it is. The cost and hassle of it probably isn't worth it.

Morally, their position is reprehensible. They made an offer with a provision which was lucrative for other contractors, therefore creating an expectation for you, but it was never going to be beneficial to you, and they knew that when they made the offer. You might tell them you are considering walking and will never work with them again after this contract.

Reading between the lines, £10K is about £1.5K / month over seven months. So if that's 15%, then the contract is somewhere around £10K / month without this completion payment? Of course £10K is significant money, but do you want to mess up a £10K / month contract over it? And it isn't £10K, it's £8K, since they've offered £2K.

If you had a firm contract offer you passed, I'd likely take it to them and say, 'This is what I passed on because of this.' They do have some room to negotiate here, they've been clearing at least £1K a month out of this contract, and I doubt they are taking less than 10%. They probably can't very well cover the full £10K, though, but you might get another £1-2K out of them if you can prove you've suffered loss. To get more than that you might have to go to court, and it won't be worth it.

If you can't prove (with evidence of another offer) that you've suffered loss, I'd just take the £2K, keep my head down, wow the client, earn a renewal, and then expect a nice increase. If asked why, you can say that you've been working below your normal rate because of an expectation of a completion payment, and you aren't willing to do that anymore. If they or the client can't come up with some more money, you are gone.

If you are mad enough, find another contract. Everybody knows you've not been treated well. The agent is going to get the blame on this one, if you aren't a jerk when leaving.

[WordIsBond]

it in no way sets n expectation, unless there's something beyond what's in the contract.

Admittedly, I'm reading between the lines that there is indeed 'something beyond what's in the contract.'

Like OP saying that he took this contract based on that expectation. You wouldn't do that on something completely nebulous like you've suggested. You would do that because either you've been told what can be expected or what has been done historically.

If he asks the agency and they say, 'Yes, sometimes some of our clients will do this, so it's in all our contracts. This one won't, though,' then he wouldn't have taken the contract, would he?

I think we can safely conclude that he was told the client DOES give completion bonuses. He was told they aren't guaranteed and that's why the contract wording is the way it is, but that is what they do. Otherwise, he wouldn't have taken the decisions he did.

And furthermore, the outcome makes it obvious. They don't offer £2K for nothing, or waive a non-compete unless they've got egg on their faces pretty badly. They made a right mess of it. Maybe they only offered those things because they felt a moral obligation to do something for him, or maybe they did it because they were concerned they just might be vulnerable legally. Doesn't matter much, they did it because they are acknowledging that they set an expectation.

If OP is able to go back to the client direct for six more months, the non-compete going away may turn out to be a relative win-win. It probably cost the agency nothing -- the client probably wasn't going to use them to replace him after this mess. But at least they don't have to pay out, and if he can renew direct at the same cost to the client, he'll be ok.

[pr1]

never accept the first offer

[WordIsBond]

never accept the first offer

Would you care to be Prime Minister? The position is currently vacant and has been for a couple years, even if the Tories seem not to have figured that out yet.

[pr1]

Would you care to be Prime Minister? The position is currently vacant and has been for a couple years, even if the Tories seem not to have figured that out yet.

not for £150k/y, no