Reply to: When does a contract end?

[TheFaQQer]

But the agency made no attempt to find out where the contract had been assigned to, or the new bank details and just carried on paying the old company, saying they had to until they recieved a termination of contract notice from the old umbrella company.

But I dont understand why the agency had this liability to the old umbrella company as they had ceased trading and assigned the contract elsewhere.

It's not as straightforward as just saying "pay him instead of us", which is what you imply the umbrella has done. The agency has a contract with the umbrella, which is what they work to.

Having one individual at the umbrella send an email which gives a new company name isn't enough to warrant breaking the contract, in my opinion.

Sounds to me like the umbrella cocked it up and you're caught in the middle.

[LisaContractorUmbrella]

But the agency made no attempt to find out where the contract had been assigned to, or the new bank details and just carried on paying the old company, saying they had to until they recieved a termination of contract notice from the old umbrella company.

But I dont understand why the agency had this liability to the old umbrella company as they had ceased trading and assigned the contract elsewhere.

Without seeing the notice that was sent out I wouldn't like to say - if you could PM it too me I may be able to make a bit more sense of the situation.

[mulberryblue]

But the agency made no attempt to find out where the contract had been assigned to, or the new bank details and just carried on paying the old company, saying they had to until they recieved a termination of contract notice from the old umbrella company.

But I dont understand why the agency had this liability to the old umbrella company as they had ceased trading and assigned the contract elsewhere.

[LisaContractorUmbrella]

It sounds as though the company has 'phoenixed' and as they have assigned all employees to the new company it should be the new company that the agency is paying and then the new umbrella company will be able to pay you.

[mulberryblue]

The umbrella company sent out a general email to all contractors and agencies stating they had ceased trading on 4th January and assigned all existing contracts to xyz company. This notification was not sent out until 21st January but then no invoices for January were due by that date. ( I have a copy of the email) Their website also showed the same information.

Their bank accounts weren't frozen as they still needed to process payments for November / december when they were still trading.

[LisaContractorUmbrella]

If the umbrella company had ceased trading one would assume that their business bank accounts would be closed and therefore any funds paid in would bounce back to the originator. You said in an earlier post that the umbrella had notified the agency - was this in writing and have you seen the correspondence?

[mulberryblue]

But if the company states they have ceased trading how can the agency automatically pay the umbrella for services provided after the date they state they have ceased trading?

Doesn't this imply the umbrella company are still trading trading if the agency is paying for a service provided after the ceased trading date?

[LisaContractorUmbrella]

But doesn't the contract cease on the date the company ceases trading?

That would depend on the contract between the umbrella company and the agency - some of them have a clause which stipulates that the contract is automatically terminated should either business become insolvent, goes into liquidation or administration or is subject to a winding up order.

[mulberryblue]

But doesn't the contract cease on the date the company ceases trading?

[TheFaQQer]

The umbrella notified the agency they had ceased trading and later also sent a contract termination to the agency. But the termination notice was not sent until a month after they ceased trading and showed they were terminating the contract from the ceased trading date a month previously. The agency wont accept the termination because it shows a date of termination prior to when they received the notice!

That sounds reasonable - you cannot retrospectively terminate the contract! Otherwise, there would be nothing to stop an agency waiting until you have finished the work and then retrospectively terminating it after one day and pocketing the cash!!

The agency has to take the termination date from when they received the notice and no earlier. The people you need to go after are your employers in this situation.

[mulberryblue]

The agency cannot break the contract with the umbrella just based on your say-so, which is why they are sticking to it and paying the party that they have a contract with.

The umbrella notified the agency they had ceased trading and later also sent a contract termination to the agency. But the termination notice was not sent until a month after they ceased trading and showed they were terminating the contract from the ceased trading date a month previously. The agency wont accept the termination because it shows a date of termination prior to when they received the notice!

[TheFaQQer]

No the umbrella company. But the agency wont accept the ceased trading date as the contract termination date and insist on paying the now deceased umbrella company for services provided by the contractor after the ceased trading date.

The umbrella company is not in administration nor liquidation but has disappeared.

Your contract is a contract of employment with the umbrella. There is then a business to business contract between the umbrella and the agency. There is then a business to business contract between the agency and the client.

If your employer has disappeared, then you have all sorts of problems - not least how are you going to get ANY money out of them? You need to track down exactly what has happened here - if they have disappeared but not gone into administration, then I'm unclear about what has happened to them!!

The agency cannot break the contract with the umbrella just based on your say-so, which is why they are sticking to it and paying the party that they have a contract with.

Sounds like you need to resign from the umbrella company and then get yourself setup elsewhere so that the agency can pay you. Looks like any more work (and possibly any past work) that you did for the umbrella has gone into their pockets.

[mulberryblue]

[QUOTE=Scrag Meister;1304223]Agency gone belly up?
QUOTE]

No the umbrella company. But the agency wont accept the ceased trading date as the contract termination date and insist on paying the now deceased umbrella company for services provided by the contractor after the ceased trading date.

The umbrella company is not in administration nor liquidation but has disappeared.

[SimonMac]

The service was still supplied to company B as the contractor providing the service (which allowed company A to fulfill the contract with company B) was not aware until later, that company A had ceased trading earlier in the month. Company A say they were no longer interested in the contract due to having ceased trading (not in liquidation or administration just for business reasons). Should company B still pay company A for the service provided by the contractor after they had ceased trading although Company A did not invoice for the money and couldn't reconcile the payment as they had no information as to what service the contractor had provided?

Compnay B SHOULD NOT PAY anything to Company A, if they do this will just go to the liquidators and the contractor would only be entitiled to a share as per all other creditors that Company A owe money too (after HMRC have had their money first IIRC)

[Scrag Meister]

Agency gone belly up?

Very confusing thread.

If this is the case, I would be very tempted to speak to the client to draw up a new contract if they will.

Cos once the money goes from the client ot the agent it'll disappear in the admin/liquidation ether, and you'll probably never see it.