Sued for Damages After Contractor Ineptitude

[DodgyAgent]

We are a Permanent Recruitment Consultancy who place the odd contractor here and there.

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They are all odd

[MOH]

Hello everyone, I am looking for some reassurance here from anyone experienced in the industry.

We are a Permanent Recruitment Consultancy who place the odd contractor here and there.

We placed a candidate with a company for 2 months around Christmas time. Everything went fine and he has now left. We are now chasing the money they owe us (we have paid him up to date through his umbrella company) and they have just revealed the following:

Apparently the chap was terrible and made some serious errors when working there. So much so that he brought down their network and supposedly affected their business.

They are now refusing to pay the bill (£15Kish) and, forthermore, are going to sue us, the recruitment company, for damages.

I have not come up against this before. I assume that I will be covered in my public indemnity insurance for this, and the contractor will be as well.

Does anyone know how the claim process will work? Will they sue us then we sue him? Will the insurance companies sort it out between themselves? Will the umbrella companies be involved? Somebody somewhere will be contesting this claim of course, but I am not sure whether it will be me or someone else.

I have informed my insurers and have made an appointment with my legal advisers, but I just wondered if anyone had any experience of this. Is there any way my insurers may try to wriggle out of this one on a technicality or anything?

Any help or comments on similar scenarios would be appreciated. Are there any agency owners or senior managers out there, perhaps? Or mature contractors with legal experience?

thanks in advance

Sounds like a job for RRH's legal team!

[EternalOptimist]

LAWYERS:

Inventing legs upon which to stand since time immemorial

Yes , I suppose Heather Mills had only one leg to stand on and she still got 55m

[where did my id go?]

This happened to me once. (I was a director of the consultancy and the man on the ground that they complained about).

In our case the client were skint and under pressure and they used this technique to try and avoid paying. We eventually settled for them paying part of our bill - mainly because the client was based in Rome and we felt that the cost of fighting would be ruinous.

They signed all the timesheets, tried to stop me leaving on the last day because they wanted me to look at a fault in a part of the system that they wrote. Then came out with all sorts of crap - publishing the documentation that I wrote on their intranet became publishing their trade secrets, etc etc.

It isnt a company with operations in Wales and Italy is it ?

[Taita]

We are a Permanent Recruitment Consultancy who place the odd contractor here and there.

We placed a candidate with a company for 2 months around Christmas time. Everything went fine and he has now left. We are now chasing the money they owe us (we have paid him up to date through his umbrella company) and they have just revealed the following:

Apparently the chap was terrible and made some serious errors when working there. So much so that he brought down their network and supposedly affected their business.

They are now refusing to pay the bill (£15Kish) and, forthermore, are going to sue us, the recruitment company, for damages.

I have not come up against this before. I assume that I will be covered in my public indemnity insurance for this, and the contractor will be as well.

Does anyone know how the claim process will work? Will they sue us then we sue him? Will the insurance companies sort it out between themselves? Will the umbrella companies be involved? Somebody somewhere will be contesting this claim of course, but I am not sure whether it will be me or someone else.

I have informed my insurers and have made an appointment with my legal advisers, but I just wondered if anyone had any experience of this. Is there any way my insurers may try to wriggle out of this one on a technicality or anything?

Any help or comments on similar scenarios would be appreciated. Are there any agency owners or senior managers out there, perhaps? Or mature contractors with legal experience?

thanks in advance

1) Sounds like they are trying to avoid payment.
2) Why doesn't your contact protect you?
3) Surely it stated that the contractor was working under the client's direction and control?
4) Apart from sweeping statements what evidence have they presented?
5) What does the contractor say to all this?
6) Why not call a meeting of the three interested parties to discuss and resolve the issues?
7) At the risk of sounding rude------stick to what you know and leave contracting to the competition.
8) and finally......do the obvious; consult a lawyer!

[threaded]

Hello everyone, I am looking for some reassurance here from anyone experienced in the industry.

We are a Permanent Recruitment Consultancy who place the odd contractor here and there.

We placed a candidate with a company for 2 months around Christmas time. Everything went fine and he has now left. We are now chasing the money they owe us (we have paid him up to date through his umbrella company) and they have just revealed the following:

Apparently the chap was terrible and made some serious errors when working there. So much so that he brought down their network and supposedly affected their business.

They are now refusing to pay the bill (£15Kish) and, forthermore, are going to sue us, the recruitment company, for damages.

I have not come up against this before. I assume that I will be covered in my public indemnity insurance for this, and the contractor will be as well.

Does anyone know how the claim process will work? Will they sue us then we sue him? Will the insurance companies sort it out between themselves? Will the umbrella companies be involved? Somebody somewhere will be contesting this claim of course, but I am not sure whether it will be me or someone else.

I have informed my insurers and have made an appointment with my legal advisers, but I just wondered if anyone had any experience of this. Is there any way my insurers may try to wriggle out of this one on a technicality or anything?

Any help or comments on similar scenarios would be appreciated. Are there any agency owners or senior managers out there, perhaps? Or mature contractors with legal experience?

thanks in advance

Sounds like the client want to blag their way out of paying if you ask me.

Surely on his timesheets was some wording to the effect that they're signing off that these are the hours worked and that the work was satisfactory? You've not heard anything until it came time to pay the bill? They had a contract with you, so why ever not?

If no wording then you're oop the proverbial creek without the paddle. Chalk it down to experience, swallow your loss, and learn how to be a business.

If the wording is there, then go to court and apply for a winding up order against them.

This case is really that binary. All this talk of insurers is bollox.

[IH33]

So in the meantime, has the client given you any new roles to work on?

[Denny]

Hello everyone, I am looking for some reassurance here from anyone experienced in the industry.

We are a Permanent Recruitment Consultancy who place the odd contractor here and there.

We placed a candidate with a company for 2 months around Christmas time. Everything went fine and he has now left. We are now chasing the money they owe us (we have paid him up to date through his umbrella company) and they have just revealed the following:

Apparently the chap was terrible and made some serious errors when working there. So much so that he brought down their network and supposedly affected their business.

They are now refusing to pay the bill (£15Kish) and, forthermore, are going to sue us, the recruitment company, for damages.

I have not come up against this before. I assume that I will be covered in my public indemnity insurance for this, and the contractor will be as well.

Does anyone know how the claim process will work? Will they sue us then we sue him? Will the insurance companies sort it out between themselves? Will the umbrella companies be involved? Somebody somewhere will be contesting this claim of course, but I am not sure whether it will be me or someone else.

I have informed my insurers and have made an appointment with my legal advisers, but I just wondered if anyone had any experience of this. Is there any way my insurers may try to wriggle out of this one on a technicality or anything?

Any help or comments on similar scenarios would be appreciated. Are there any agency owners or senior managers out there, perhaps? Or mature contractors with legal experience?

thanks in advance

Why don't you ask your recruiter trade association for help if you belong to one. It's their job to advise you on contractor negligence. If not ask a lawyer.

Like any business, you're taking risks, so you need to be prepared for those and take the correct precautions. I'm surprised that you didn't seem to know how well this contractor was doing before you were threatened with legal action over his performance. Was it really bad or is that a client excuse to not pay you? Didn't you have a clause in your contract with the client to ensure they had a duty to inform you as soon as things went wrong with the contractor's performance, so that you could take remedial action to terminate the engagement immediately if it couldn't be remedied or get a replacement or at least find out what this contractor was playing at?

To be honest with you, I'm not at all surprised that 'agencies' like you (and you are an agency because you place permies) are in this mess. It seems commonplace for clients to use the wrong type of recruitment organisations to source for their flexible resources even when they are in fact EBs. It's a gripe that I've had for ages as most don't seem to have a clue what they are doing because they're not experienced in the vertical markets they specialise in or else they, like you, dabble in sourcing for roles requiring a specialised degree of knowledge that you clearly don't have experience of dealing with.

I hope you get it sorted, but I must say I am rather surprised you have the gumption to come on here asking for contractors advice over something that's got nothing to do with contractor issues.

Have you tried going on UKRecruit as well? They offer advice for recruiters. Why don't you check it out as you may find other recruiters who have had to deal with problems similar to what you're facing now.

[xoggoth]

Only thing I would add, always think carefully about wording of any claim to insurers. Check the conditions, ensure you say nothing that could be a get out.

[The Lone Gunman]

Try telling the client that as no payment has been made you hold the IP on all software produced by your man and that you are not licensing them to use it, or are licensing at a cost more than they owe. Get your legal bods on em to prove they aint using your stuff. Effectively stop em trading. Nightmare for em to prove they aint and if you can get a legal block on em you are laughing.
Tie em in knots.

When they say that the IP goes with the delivered product you then have em on the grounds that the product is up to scratch.

As ever: I am not qualified to give this advice.