Reply to: EB regs - no opt out and direct to client

[malvolio]

Actually I think the intention is pretty clear. Quoting from the regs themselves...

Regulation 32(9) provides that limited companies and those persons whose services they supply can choose not to be covered by the provisions of these Regulations. If they do exercise the choice not to be covered by the Regulations, then both the limited company and the worker to be supplied must give notice, to the employment agency or employment business that this is the case, before they are either introduced or supplied to a hirer.

(My emphasis)

They are trying to cover the dual conditions of people like us who are intrerviewed by the client prior to being taken on, and people like traditional temps, who merely turn up on Monday morning, steno pad in had, to begin work as directed by their agency.

In other words, as far as we are concerned it is the first official contact between workseeker and client that sets the "introduction" point - and going back to the OP's original question, he cannot have opted out at the point the agency says he can, therefore he is opted in.

If this ever does go to court, it would be a valuable addition to case law to get this particular point established for once and all.

[TheFaQQer]

Don't know if this thread is still live ... but just entered this space. I signed opt-out after interview - even had a small back-and-forth about it when it happened.

It's 8 months later and negotiations on a (3rd) extension with the agent have broken down. Client is happy to take me on - but what exactly is the recourse for the agent?

Presumably I am opted-in, which limits what he can claim for "lost business"?

NB: I've tried reading the regs - makes my head spin

I would say that you are opted in. The agency will say that you are opted out, because you opted out before you were "introduced" - they tend to define introduced as being on site, working.

You'd need to leave 8 weeks gap if you are opted in, before you can go direct - this may be fine to do (both with the client and your own financial situation), but generally isn't.

If you are opted in, and go direct without leaving 8 weeks notice, then they can claim losses from you. If you are opted out and there is a restriction in the contract, then they can claim losses from you. Bear in mind that they can come after you and / or the client - just because they aren't after the client doesn't mean they will leave you alone.

If you know what their margin is (or can guess), then you can estimate what their losses would be, and might be able to come up with a settlement figure with them.

[ilgitano]

....which means....back to my original point..... that generally speaking the ever-so popular tie-in clauses seem to be put in by EB's hoping that their contractors don't know the law. I wonder how many people are duped by it and how much money the EB's make from falsely claiming loss of business when they do lose a contractor to a client.

Hmmmm....lawyers would have a field day.

Don't know if this thread is still live ... but just entered this space. I signed opt-out after interview - even had a small back-and-forth about it when it happened.

It's 8 months later and negotiations on a (3rd) extension with the agent have broken down. Client is happy to take me on - but what exactly is the recourse for the agent?

Presumably I am opted-in, which limits what he can claim for "lost business"?

NB: I've tried reading the regs - makes my head spin

[oraclesmith]

....which means....back to my original point..... that generally speaking the ever-so popular tie-in clauses seem to be put in by EB's hoping that their contractors don't know the law. I wonder how many people are duped by it and how much money the EB's make from falsely claiming loss of business when they do lose a contractor to a client.

Hmmmm....lawyers would have a field day.

[Not So Wise]

"before they are either introduced or supplied to a hirer."

"You can opt out after intro, but not after supply."

I take that "or" to be inclusive, when either one has occurred, introduced or supplied there can be no opt out.

While it might sound illogical that supply can happen before introduction it does happen (been on contracts with no interview or contact with client till the first day I arrive on site), it is even more likely when you realise that both the contractor company and and the contractor have to opt out, aka contractor company gets introduced and contractor working under that company who had no part in the negotiations does the work, aka gets supplied.

Basically unless the agency gets you to sign the opt out (for yourself and your company) before introduction to client (interview/sales pitch), you are opted in regardless of what you sign

[The Lone Gunman]

Regulation 32(9) provides that limited companies and those persons whose services they supply can choose not to be covered by the provisions of these Regulations. If they do exercise the choice not to be covered by the Regulations, then both the limited company and the worker to be supplied must give notice, to the employment agency or employment business that this is the case, before they are either introduced or supplied to a hirer.

Taken from the regs. You can opt out after intro, but not after supply. You still have to opt out though. If you have not opted out and you started the contract then you are opted in by default.

[edit]Not sure if the OR isn't there because of the difference between an EB and an agency. Anyone?

[mashetti]

And to be honest you are most likely opted in, because even though most EB's get contractors to sign an opt out, most do this AFTER they introduced the contractor to the client (normally at the contract exchange stage), thus making the opt out invalid.

I was recently given a document by a colleague on the regulations and noticed a slight variation on this rule that is always mentioned i.e. that the opt out is invalid if you have already been introduced to the client.

It said something along the lines of "you must opt out before being introduced to the client OR before being supplied to the client".

Now in my world of logic this OR that is tacked on the end would catch most people assuming it means before you actually get on site for the client. Anyone else seen a similar thing? I have the doc at work so will check exact wording and verify source...

[Not So Wise]

Clause is invalid if you are opted in
Clause is valid if you are opted out

And to be honest you are most likely opted in, because even though most EB's get contractors to sign an opt out, most do this AFTER they introduced the contractor to the client (normally at the contract exchange stage), thus making the opt out invalid.

[oraclesmith]

Did you opt out of EB ? If not, then that clause is illegal and unenforceable, in my opinion. It implies that there can be a 12 month tie-in once you end a 12 month contract, or a 6 month one for a 6 month contract.

There should be no such tie-in in your contract with the EB and only one which replicates the 14week/8 week criteria in the regs for the contract between the EB and the client.

Any EB's here want to comment ?

[The Lone Gunman]

Isn't that the same thing as contractors are hired by the client?

See my answer just prior. I had completely missed something.

[The Lone Gunman]

This is what it says in my ltdco's contract:

The Supplier[My Co] and the Representative[Me] shall not
3.1 during the Contract Term or thereafter for a period equivalent to the period of this agreement (but not being less than 3 months nor more than 12 months) either directly or indirectly (whether under a contract of services or contract for services or through any third party) provide similar consultancy services to the Client or End User except by contract through the Company;

If you are opted in then that para is void if not actualy illegal.

[Bluebird]

This is what it says in my ltdco's contract:

The Supplier[My Co] and the Representative[Me] shall not
3.1 during the Contract Term or thereafter for a period equivalent to the period of this agreement (but not being less than 3 months nor more than 12 months) either directly or indirectly (whether under a contract of services or contract for services or through any third party) provide similar consultancy services to the Client or End User except by contract through the Company;

[The Lone Gunman]

See reg 10. This is about the EB-client relationship and the charges they can make to the client. They CAN make charges, but they are limited in scope and don't apply at all (as far as I can ascertain) after 8 weeks has passed since the end of the contract. So those terms which said that you can't work direct for client inside 12 months unless you pay our cut (or in the EB-client contract which say if you engage contractor within 12 months you must pay our cut), are illegal. In my opinion.

I read it again. You are right. Obviously, this is my opinion and as ever I am not qualified to offer that opinion.
I must have read these regs a dozen times and that bit has always passed me by.

[oraclesmith]

The regs do not actualy stop this though do they.
There appears to be nothing in there that states the agent can not charge the client should they keep a work seeker on.

I agree that it would be odd, but all the regs say is that the agent can not limit the work seeker. Leaves the goal wide open on limiting the client.

See reg 10. This is about the EB-client relationship and the charges they can make to the client. They CAN make charges, but they are limited in scope and don't apply at all (as far as I can ascertain) after 8 weeks has passed since the end of the contract. So those terms which said that you can't work direct for client inside 12 months unless you pay our cut (or in the EB-client contract which say if you engage contractor within 12 months you must pay our cut), are illegal. In my opinion.

[oraclesmith]

I'm not sure it would be legal to sidestep the law by overriding contract terms between EB and client. Otherwise, the new regulations would be pointless. I expect EBs are simply lying to clients hoping to get away with this kind of thing.

I think you're right. From what I've read, it's not illegal for the EB to enforce some kind of charge on the client if it's reasonable and it's within the criteria laid out in reg 10. However, it is almost certainly a pointer to a dodgy EB if they have retention criteria in the contract the contractor signs. In the regs it seems the client always pays any charge, not the workseeker. It means that contractors can approach old clients after a couple of months of the end of the contract.

So.... has anyone got a recent contract that has the old 12 month clause still in it?