Reply to: Second Tier Supplier Verbally Offering Contract but Stalling on Day Rate

[northernladuk]

I understand but in this situation the client is actually the agent i.e my client is sub- agent, their client is the agent and the agent's client is the end client. So they're both getting a sizeable chunk in margin from my day rate. Are you saying that there's still a chance that I could renew direct with agency 2 (not sub- agent) anyway? I've now opted out by the way....

It's possible but very much depends on the situation. If you are trying to cut out agent 2 purely to save on their margin then absolutely not. The handcuff is there to protect their revenue stream and any loss incurred by them will mean the handcuff is slam dunk. Even opted in the agent is going to fight tooth and claw for their money and is likely to kick up such a stink they'll scupper the whole deal first.

The wiggle room comes where the other party cannot prove they are losing anything. You can't restrict workers just because you've had your nose put out of joint. It just won't stand up in court.

But as I said, the best way out is negotiation. Agent 2 might fold on the handcuff to keep agent 1 happy and protect a bigger revenue stream. This has happened a lot on here but only Agent to Client. I would have thought agent to agent is a very tenuous relationship.

Who knows, but opt in is not your golden bullet.

Perversely enough you've already been introduced to the client so an Opt in afterwards is questionably not valid anyway. I'd be willing to bet if it really came down to the nitty gritty you'd find you are technically opted in, but the agent won't agree. That's the stupid thing about this whole legislation. Agents just don't know how it works. They will argue it's 'before supply' but I am sure this is only for when the contractor is already known to a client already. A new contractor would come under the 'introduction' heading.

[ziggystardust]

And again. No handcuff situation on here has been resolved by being opted in. A 12 month handcuff isn't enforceable anyway but regards of your status the agency is likely to cause a fuss and the client won't want to get it to a legal fight so likely you'll just get dropped anyway.
Often when a client is through an agency its very unlikely they'll deal direct even if your agency goes bump. They'll just fina another agent. If your client doesn't deal direct with contractors then opt in isn't really helping.

I understand but in this situation the client is actually the agent i.e my client is sub- agent, their client is the agent and the agent's client is the end client. So they're both getting a sizeable chunk in margin from my day rate. Are you saying that there's still a chance that I could renew direct with agency 2 (not sub- agent) anyway? I've now opted out by the way....

[BlasterBates]

I agree with nothernladuk, the opt in is not worth risking a contract. I think you will lose the contract by creating a lot of hassle between the agency and the client. A contract that doesn't explicitly mention opting in isn't necessarily opted in, it could be an expensive legal challenge. A contractor not under the direction and control of the client isn't covered by the regulations.

[northernladuk]

And just to say, all the above and what you are hoping for hinges on the agency understanding the legislation and being willing to apply it correctly and I can almost guarantee they won't do either.

[northernladuk]

There are many many threads on here about the effectiveness of being opted in but in summary.

For me firstly it's the concern about the risk of non-payment i.e if opted out they don't have to pay me if I don't have a completed timesheet or if the end client doesn't pay them. The agency is very small (c30 staff) and, although I was initially dealing with just the recruitment consultant who contacted me about the gig, all further communications were with their MD, one of the owners of the agency, which seems rather over the top... the MD getting involved with individual gigs. It raises questions.. does the company have cash flow problems? Will they pay me on time?

To date I haven't seen a single non payment thread that has been resolved by flashing the opt in card for a start. Also, the concerns you raise are bigger than opt in. Sounds like you are worried the agent is going to have cash flow issues or go bump. Opt in won't help you here. It will only cover getting paid with no timesheet which will just be your last invoice if there is a dispute. If the agency can't or just won't pay you you'll have to go legal. Being opted in is far from a magic bullet to getting paid.

Secondly there is the restriction clause... after contract completion I am not able to engage directly with the client for 12 months. Ideally I'd like the opportunity to deal directly with the preferred supplier or end client if renewed instead of through the sub- agent so that I don't have that extra "middle man" to deal with and the extra margin they'd take on my day rate. Not sure how I'd do that though as the contract is still with the preferred supplier, not sub-agent.... they're just getting the fee for finding me.

And again. No handcuff situation on here has been resolved by being opted in. A 12 month handcuff isn't enforceable anyway but regards of your status the agency is likely to cause a fuss and the client won't want to get it to a legal fight so likely you'll just get dropped anyway.
Often when a client is through an agency its very unlikely they'll deal direct even if your agency goes bump. They'll just fina another agent. If your client doesn't deal direct with contractors then opt in isn't really helping. Lots to be discussed about handcuffs but the bottom line is nearly every handcuff situation is dealt with through negotiation.

I agree, opting in could increase the work of the agency and effectively increase the time it takes to onboard me, as I'd have more hoops to jump through, particularly with the bank. At the moment their method of onboarding is more of a 'fast-track approach' to get me started in about half the time as I'm urgently needed.

It would also increase the financial risk to the agent as they may have to pay you if the client doesn't pay and also risks losing their revenue stream with no handcuff and it sounds from what you say there is no way a small agency can work like that.

I'd think very careful before making a fuss over opt in in this situation.

[ziggystardust]

Do you fully understand the Legislation? Is there anything there that means so much you'll push back on the agent?

For me firstly it's the concern about the risk of non-payment i.e if opted out they don't have to pay me if I don't have a completed timesheet or if the end client doesn't pay them. The agency is very small (c30 staff) and, although I was initially dealing with just the recruitment consultant who contacted me about the gig, all further communications were with their MD, one of the owners of the agency, which seems rather over the top... the MD getting involved with individual gigs. It raises questions.. does the company have cash flow problems? Will they pay me on time?

Secondly there is the restriction clause... after contract completion I am not able to engage directly with the client for 12 months. Ideally I'd like the opportunity to deal directly with the preferred supplier or end client if renewed instead of through the sub- agent so that I don't have that extra "middle man" to deal with and the extra margin they'd take on my day rate. Not sure how I'd do that though as the contract is still with the preferred supplier, not sub-agent.... they're just getting the fee for finding me.

I agree, opting in could increase the work of the agency and effectively increase the time it takes to onboard me, as I'd have more hoops to jump through, particularly with the bank. At the moment their method of onboarding is more of a 'fast-track approach' to get me started in about half the time as I'm urgently needed.

[northernladuk]

Do you fully understand the Legislation? Is there anything there that means so much you'll push back on the agent?
If you are that eager to opt in then by all means ask but I wouldn't risk a gig for it.

The agency is well within their rights to not deal with Opt in contractors because of the extra responsibilities.

What does the opt in/out status have to do with it being a small agency?

[ziggystardust]

At last... got a verbal offer followed up by an email to progress checks etc. However I noticed on the "standard" contract the compliance team sent was with opt-out terms when I never chose to opt out.

When I replied requesting that the opt-in terms be sent the response was that they don't have opt-in terms written because all of their contractors opt out - he would have to ask their Operations Manager and if I decided to, also inform the end client. He also asked what my reasons were for wanting to opt in.

I have a feeling that they're going to say the end client will not want to go ahead if I don't opt out when it shouldn't matter? How should I handle this and would opting in mean a lengthier screening process? I was going to respond with the statement that what other contractors do is their business and I don't feel I need to be giving reasons but I'm also wary of risking losing the gig. My concern is their payment terms are monthly and the agency is small. I've never dealt with them before and I've already been knocked back when I tried to negotiate down the payment terms from 1 month invoicing and a 10 day pay term..

[ziggystardust]

[GhostofTarbera]

Or the agent has a friend they would like to get in, so waiting for you to take other job and then tell client you are not gone


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[ziggystardust]

I haven't formally accepted and the rate has not been formally confirmed. I was forwarded at one rate, then, after my interview, the agent said he would push for a higher rate. Since then, it has been the agent confirming that the preferred supplier agency would like to make me an offer but he hasn't received all the details yet but it's likely to be 6 months. I don't know what kind of sketchy email that was... an email that says 'hey, we'd like to offer the candidate a contract. We think it'll probably be 6 months but we haven't decided how much the day rate is definitely going to be yet. Will let you know!'? In all my previous experience the agency has offered me verbally, stated the day rate there and then. Is this just stalling tactics from the sub- agent? I told them I'd hear back from the pretend other interview today so are they just waiting on whether I say I have or have not got it to then decide whether to flex the day rate? We're talking 10s of £££ here so not huge, but I maybe playing a risky game here...

[BrilloPad]

It's normal for it to take some time, the contract will have to be signed off by several managers some of whom might be out of the office. If you asked for more it will take even longer.

Be patient and continue looking.

Indeed. Reminds me of recent gig. Just needed one more signature. I did not know it was a new joiner from another bank. Who immediately put a lid on contractors - starting with my contract. I turned down another gig for that - God what an idiot!

Or my PIMCO interview. 15 interviews including at 11pm at night with the SF office. Just one rubber stamping interview with board member. Of course, that went South. Luckily for that one I still had a job so nothing lost.

Isn't a gig in the hand worth 100 in the bush?

[BlasterBates]

It's normal for it to take some time, the contract will have to be signed off by several managers some of whom might be out of the office. If you asked for more it will take even longer.

Be patient and continue looking.

[ziggystardust]

Is it a big client? Are they more likely to be on a fixed rate card? If so then your negotiation is limited to take a cut from the agents rate. Try and get confirmation in writing if the agents are on fixed rate commission.

It's a Banking client so yes, they are big and I believe that they have a fixed rate card. I'm not sure how I can bypass this sub agent or if that's even possible? Communications do seem to be taking a long time just in terms of getting written or verbal clarity on an offer...

[northernladuk]

The client can't make you an offer. You have no contractual relationship with them if agents are involved. They can pick you as their first choice but offers must come from the agents.

Is it a big client? Are they more likely to be on a fixed rate card? If so then your negotiation is limited to take a cut from the agents rate. Try and get confirmation in writing if the agents are on fixed rate commission. If they are then they won't move on their numbers. It will be down to the client paying more which isn't likely (but not impossible). If the agents are in an agreed chain there is very little chance of you playing them off against each other.

I've been in a similar position with a preferred agent using sub agents. UKAR I think it was. Very messy and complicated. Try and stick with the main agent if you can so there isn't another body in the chain. I believe in my situation the rates were the same regardless of agent so no idea how that worked.