Opt out of Conduct of employment agencies 2003 act?

[SueEllen]

Kess there is absolutely no need for the agency to have two different contracts for opted-in and out contractors.

All a clause needs to state is that if the contractor is opted-out this clause applies. It tends to only apply to 2-3 clauses in the contract.

I have had agency contracts taken apart by different lawyers, and also have agencies who contracts have been properly written for them by lawyers.

[Kess]

Hi SueEllen,

I agree that there is no need for different contracts, but unfortunately this agency (one of the big ones) does. I've compared the two contract versions and there are two key differences:

1. As anticipated, the opt-out contract has the following paragraph tying me to the agency:

The Company and the Consultant will not either during the Project Period or thereafter for a period equivalent to the period of supply under these terms of engagement (but not less than three months nor more than 12 months) either directly or indirectly (whether under a contract of service or a contract for service or through any third party) provide the Services provided (or substantially the same as those provided) under these terms of engagement to the Client (or the Client's customer) except by contract through [the agency] or by the Company paying to [the agency] a fee of 25% of the total remuneration agreed to be paid for the services by the Client (or the Client's customer) for the relevant period of supply (but not exceeding 12 months).

Not opting out avoids this restriction.

2. This clause in the opt-in version is more worrying:

The Company agrees that the Consultant is an agency worker as governed by the Agency Workers Regulations 2010 ("Regulations") and is entitled to the same basic employment and working conditions ("Conditions") that the Client may provide to a comparable employee of the Client performing a same or similar role, as defined under the Regulations.

I don't want nor expect to be treated like a normal employee, and that wording about entitlement etc. sounds like an IR35 trap. Any thoughts?

[Ticktock]

I don't want nor expect to be treated like a normal employee, and that wording about entitlement etc. sounds like an IR35 trap. Any thoughts?

Yes. They're trying it on. Do not accept it. I'd be getting to the stage where I'd think of telling the agency that if they are not able to provide a simple contract that does not force you to opt out without becoming an employee then they obviously are not experienced enough in the Contract industry to be able to properly manage the business relationship and they can go shove it.

EDIT: And there's always that temptation to contact the client, telling them that the agency is not able to produce a contract, so unfortunately you won't be able to work with them...

[malvolio]

Yes. They're trying it on. Do not accept it. I'd be getting to the stage where I'd think of telling the agency that if they are not able to provide a simple contract that does not force you to opt out without becoming an employee then they obviously are not experienced enough in the Contract industry to be able to properly manage the business relationship and they can go shove it.

EDIT: And there's always that temptation to contact the client, telling them that the agency is not able to produce a contract, so unfortunately you won't be able to work with them...

Agreed. They are deliberately conflating the Agency Regs with the Agency Workers ones, which demonstrates either total ignorance of or contempt for the laws that govern their business. That clause has no legal basis and should be struck out in its entirety. Personally my response would be along the lines of "What kind of a f***ing cowboy outfit are you?" followed by a swift exit.


Actually, who are they - I know some people who would appreciate a good laugh...

[Kess]

I think it's clear the agency is trying it on by the fact they just sent me the opt-out contract with no discussion etc.; most people would probably just sign. (I guess it could be argued that the opt-out is invalid anyway because it's supposed to be exercised before the introduction to the client, not at the end of the interview/offer process).

I might name them once things are all sorted. This is a good long-term contract at a good rate with a good client (and, alas, this agency is the only one they work through) so I don't want to rock the boat too much yet...

[malvolio]

I might name them once things are all sorted. This is a good long-term contract at a good rate with a good client (and, alas, this agency is the only one they work through) so I don't want to rock the boat too much yet...

Your call of course. However I might by now be considering mentioning to the client that their preferred agency is seriously damaging your chances of starting by insisting on unworkable and unreasonable clauses in their contract.


However there is a further thought: it is more than possible that your potential client's Human Remains team don't understand the laws (or the agency has told them a load of old cobblers) and have demanded the agency uses these clauses...


So strike out that clause and see what they say. Whatever happens, you are not opted out anyway.

[Kess]

Well, comparing the two contracts again it's hard to escape the conclusion that the opt-in version has been maliciously worded to be as IR35-unfriendly as possible (e.g. by citing that irrelevant AWR stuff about being an agency worker entitled to the same stuff as an employee).

I'm sorry to say I'll probably chicken out and do the opt-out version rather than stir things up any further.

[malvolio]

Well, comparing the two contracts again it's hard to escape the conclusion that the opt-in version has been maliciously worded to be as IR35-unfriendly as possible (e.g. by citing that irrelevant AWR stuff about being an agency worker entitled to the same stuff as an employee).

I'm sorry to say I'll probably chicken out and do the opt-out version rather than stir things up any further.

Good answer. If you ever get to the point where it matters, BIS will agree that you won't be opted out anyway...


And you can stick them with a £50k fine by making the opt out a condition of your contract if they make a fuss...

[Wanderer]

I'm sorry to say I'll probably chicken out and do the opt-out version rather than stir things up any further.

No, don't do that. There is no reason why the Agency Conduct Regulations opt out should be linked to the Agency Worker Regulations. Just ask them to strike the AWR clause out of the contract or better still, get it reviewed and ask the reviewer to negotiate it for you.

Also, report this to the PCG (doesn't matter if you are a member or not) as it was their own goal that caused this problem and they are in denial about agencies abusing the opt out.

[Kess]

No, don't do that.

Sorry, I've just chickened out and gone ahead and signed the opt-out version of the contract.

However, I did have a discussion with a lady in the agency's "contractor care" department about the differences between the two contracts. She all but admitted that their opt-out contract was worded to be IR35-friendly while the opt-in version wasn't. (She was also well aware that signing the opt-out declaration after I'd been introduced to the client probably rendered it invalid! Oh, and apparently I'm the first contractor who's ever asked her about not opting out, if you can believe that.)

The saga has left a bad taste and, now I happen to have copies of the two contract versions, I could forward them to the PCG as an example of the kind of tactics being employed by agencies.