Reply to: Restrictive Covenant ... more on this.

[The Agents View]

[QUOTE]

Lol all that hand wringing "The Agents View" and you're still not convincing anyone. Those of us who have been both the hirer and the hired have seen your business model from both ends and its amazing what a different perspective you get. It doesnt take much to link up the two ends and realise there isnt much proactive going on in between. Sure if you are head hunting then there is all the world of difference but this represents a very small percentage of the contracts out there.

I'm not a headhunter. But do you know what, the only difference between myself, and a headhunter, is the way in which I start a telephone call. I have no need to blow smoke up the rear end of a contractor and make them feel as if I've "hunted" them down - those days are gone as the information is freely available on LinkedIn etc.

I'm talking generally so if you are one of the very few agents who actually reads all the CVs (not just the 50% rule or the I have three so I'll stop looking) and scours the registered contractors for a match rather than relying on the auto suggestions from the job board then I commend you. You are in the absolute minority. Good agents do exist and they are like flawless diamonds, valuable and unbelievably rare. The problem isn't that agents exist, I accept this. It's that a vast majority of them wouldn't think twice about lying to your face and have actually no idea about the industry they are recruiting for. Its actually a shame for the good agents that they have to compete with the dross of the universe (although we seem to have a similar problem in IT).

Unfortunately, the industry is awash with cowboys, who think that reading a CV is the best way to assess the suitability of a contractor. Ultimately, the CV for me, is the first port of call - it's my sanity check to make sure that if I call this person, they're going to have some idea of what my client is looking to achieve, and won't result in me wasting my time - beyond that, the qualification call is the most important element. However, as much as you get the cowboy recruiters, you also get a number of cowboy contractors - people who think that contracts are permanent jobs, where they can just "pick it up as they go along". The reality is, that the use of the contract market, during times of austerity is limited to those who have been there and done it. Hit the ground running, been through this process a number of times, expert ability in XYZ are all common in client demands - now more than ever.

Do I read every CV? No - I have a cut off point, usually about 48 hours into any advert run - ultimately, I have to call time on it somewhere. As I've previously said on here - the first run through is a scan read - I will very basically check that the highest level requirements are met, and then I'll call to discuss the others - however, out of 100 applications, it's not uncommon to find that there's maybe five or six applicants who fulfill that criteria.

Answer this, who do you consider yourself to be an agent for, the client or the contractor? To be both is a conflict of interest. If the client, how can you negotiate rate on the contractors behalf, and if it is the contractor you represent why do you never seem to do so for more than one contract at a time? Next time an agent calls you ask him this question, you'd be surprised what different answers you get.

It depends on the situation. If I'm being pro-active, I work purely on behalf of the contractor. If I'm finding someone on behalf of a client, I work, in the majority for the client (in this case, additional candidates aren't as difficult to find as additional clients!) - However I think there always has to be some form of balance - I'm a firm believer that relationships matter, and that the project assistant of today, is the programme director of tomorrow - As the recruiter, if you provide a fair deal to everyone, then there's not any bad blood. I personally am quite upfront about the margin I charge. It averages at 15%, with some at 20% and some at 10% - I don't get too hung up on it, as doing that can, and does stop placements from happening, and that's no good for anyone.

What I would point out though, is that regardless of how fair I want/need/should be - ultimately, it is not the contractor who pays my bill.

Look I admit I was a bit harsh in my previous post but it came off the back of a call from yet another agent who phoned me to "check what other opportunities I am currently involved with so he can make sure he doesn't put me forward twice". Funny when you ask them what they are thinking of putting you forward for so you can tell them if you've already been involved with it they suddenly don't seem to have anything at all.

Amazing! Phishing I can cope with - as long as it's quid pro-quo - i.e. if I've got you an interview, then I'll ask what kind of roles are going on for you elsewhere - my expected response from that is a couple of job titles at the most. At which point, I'll ask the contractor to do a deal with me - so if I can convince the client to take them on, and pay them the money they want, without any massive rate squeezes, I'd like the details of who they've seen, and for what position. Up front, honest, and simple. The notion of asking for information for nothing in return shouldn't really register in a recruiters brain. Unfortunately, there are some massive businesses out there, run by the ultimate cowboys, who think that you lot still fall for that Scr3p.

[terradev]

Yes and i'm sure you believe all that

Lol all that hand wringing "The Agents View" and you're still not convincing anyone. Those of us who have been both the hirer and the hired have seen your business model from both ends and its amazing what a different perspective you get. It doesnt take much to link up the two ends and realise there isnt much proactive going on in between. Sure if you are head hunting then there is all the world of difference but this represents a very small percentage of the contracts out there.

I'm talking generally so if you are one of the very few agents who actually reads all the CVs (not just the 50% rule or the I have three so I'll stop looking) and scours the registered contractors for a match rather than relying on the auto suggestions from the job board then I commend you. You are in the absolute minority. Good agents do exist and they are like flawless diamonds, valuable and unbelievably rare. The problem isn't that agents exist, I accept this. It's that a vast majority of them wouldn't think twice about lying to your face and have actually no idea about the industry they are recruiting for. Its actually a shame for the good agents that they have to compete with the dross of the universe (although we seem to have a similar problem in IT).

Answer this, who do you consider yourself to be an agent for, the client or the contractor? To be both is a conflict of interest. If the client, how can you negotiate rate on the contractors behalf, and if it is the contractor you represent why do you never seem to do so for more than one contract at a time? Next time an agent calls you ask him this question, you'd be surprised what different answers you get.

Look I admit I was a bit harsh in my previous post but it came off the back of a call from yet another agent who phoned me to "check what other opportunities I am currently involved with so he can make sure he doesn't put me forward twice". Funny when you ask them what they are thinking of putting you forward for so you can tell them if you've already been involved with it they suddenly don't seem to have anything at all.

[AussieDigger]

I think 12 months is a restraint of trade in any case.

But the workaround to your problem is this:

Contract yourself through someone else's company and you simply supply services to that company. Unless of course the restriction clause limits it to third parties as well ?

Alternately, get the client to change the role to make it distinctly different.

Otherwise, I would call the agent's bluff. If you've been there for 14 months then the agent has made good ££££ out of the contract and you're entitled to carry on with other roles. I can't stand agencies that do this and they just kill their chances with the client for future work. Basically they are saying that if they can't have the role then no one will. Stupid.

[The Agents View]

[QUOTE]

And this is what reinforces the delusion, all your effort and costs are in step 1 and chasing people who are busy and dont want to be hassled.

Got a better idea? You have two choices - either post it here for all to benefit from, or start your own business and make a killing. Think you can make a business work by waiting for work to come to you?

This all serves you and not the contractor or the client. All your hapless antics do is annoy everyone involved.

Well - apart from the person who secures a better contract, at a better rate for a better term....

I can get the contracts drawn up and exchanged for £100 through a fill-a-form contract service and get no sneaky clauses.

Not without the job you can't....and where do you think you're going to find the jobs??

I can place the advert on Jobserve (it doesnt take a genius you know).

I can code Visual Basic - doesn't mean I'm a programmer.

I can read through the CVs or pay one of my devs a little overtime to do it for me.

You have time to read through 150 (average response) CV's? I thought you said you were busy?

I can arrange an interview, it takes the same time on the phone to an agent as it does to a candidate, actually agents are harder to get hold of.

I'll give you that - the process of booking an interview is not all that efficient.

The demand and supply both exist independent of what you do and in your absense they would find each other like they do throughout the business world.

That's hilarious. If the agencies hadn't spent time explaining the virtues of the contract industry, the only jobs out there would be permanent jobs - with odd "consultancies" springing up to cover project based work. You actually have NO idea how important the insertion of the agency model has been, to creating a profession out of geeks like yourself.

All this carp about business development is about you VS other agents and is not contributing to the quality of either the contractor or clients experience.

Right.....so errr....when there's competition, you think the quality of service goes DOWN? You know, you should look into investing in a basic business training. But just to correct you - competition drives quality improvements - you don't win business, by being the worst - you win it by being the best.....or the best compromise of quality vs. Cost.

All this guff above is desperate self justification but it is empty and you know it and we know it. Your costs are only high due to the fact it is expensive to insert yourself into a position where you are neither needed or even wanted most the time.

Well lets be honest - this industry has survived well enough for the last 30-40 years - I suggest you take a look at whether that means we are needed or wanted. Not wanted I could accept - it's a bit like tax - nobody wants it - but my god, when it's not there, things don't half fall apart.

All that said I'll pay the commission for the convienience right up to the point that an agent start lying and cheating to further their own profits. Then i'll go elsewhere. I know enough to know potential candidates are scouring jobserve etc and don't care which agent is involved. I am not going to miss out on a stella candidate by going with another agent as the smart contract is applying to all the adverts.

Yep - At the basic, bottom level (high street agencies, etc) you're right - jobserve etc is the source of their candidate pool. However, these agencies will charge you 10-135% margin. The point at which it becomes worth more than that, is the point that an agent can get you the absolute superstar, that neither you, or anyone else can provide - and at that point, that is when you can't live without us

If you take all the effort out of the above list that relates to purely promoting yourself and your business you'll realise there is very little left. I would be more cautious about how loudly I screamed about it if I was you. I don't begrudge you your business, it fills a hole, but don't try and convince us all the desperate BD is for our benefit and not yours, we're geeks, not idiots.

Well you clearly are an idiot, if you can't see that the BD side, fulfills two criteria. Promoting our business, and opening doors for yours.

Edit : Oh and regarding the "determined that the job doesn't require what's on the spec, because their experience will see them through". What makes you think you have the technical knowledge to know if a relevent complimentary skillset that is not specific to the specification will be of interest to the client.

You're speaking to the wrong person. I'm not a technical recruiter. However, in my field, I've developed a knowledge of what is relevant and what isn't - this can be applied within the technical space if needed. HOWEVER. When a client dictates that the person they require MUST have XYZ skill set - if you haven't got it, then you're not right - it's that simple.

You are the least qualified person to make that determination. Believe it or not a numpty noob with 12 months experience in the precise skillset is a lot less desirable than a 10 year senior developer working with similiar technologies. Sure I dont want someone with no experience in that area at all but somethings are very transferable (e.g. a WPF dev for a silverlight role).

Well if you tell your recruiter that, he will help you find what you want - if you don't - then expect exactly what you've asked for.

You don't even understand the jobs you are recruiting for.

Errrr....You don't know what I recruit for? (fortunately it's not jumped up developers)

So not only are some agents over priced, arrogant and deceitful, they are pretty much the weak link in the chain too. This is probably why all the CVs I get sent through are garbage.

I suspect most of the reason you get sent garbage candidates, is because you are a garbage client.

[suewood27]

Literally speaking there is, it's the Reputation icon at the bottom left of each post which has approval or disapproval radio button options and space for some comment text.

ah .. got it, thanks (very new to this!)

[terradev]

My point exactly...

Do you have ANY idea how much work is involved in each person you place as an agent? Allow me to give you an idea.

1) Agent has to find the job. This can be a case of hammering a phone for hours, it can be networking, it can be referral, it can be relationship driven, but one method will not deliver the volume of business required to be successful - so we probably spent 50% of our time, seeking new contracts - average cost probably in the region of £50k PA Per Consultant when you take into account salaries, benefits, Business intelligence tools, networking events, advertising etc

2) Agent has to then find the candidates for the role. Costs here include advertising, spending time weeding out the imbeciles who can't read a job spec, or are determined that the job doesn't require what's on the spec, because their experience will see them through (seriously - if I say I need something, my mind is unlikely to be swayed if you don't have it - why would you think I haven't pushed back on the client to find out if specifics are essential?), Job board access (probably costs around £1000 PA, per consultant judging by our budget vs. no. of consultants) - LinkedIn, Networking, referral, chasing people who don't answer their phone.

3) Speak to candidate re: Opportunity - 50% at the minimum aren't interested.

4) Prepare and pitch CV once interested, interesting person is found. Whether referenced up-front, or pitch prepared, there is always an element of cost involved in preparing the CV to go across

5) Chase client for hours on end waiting for CV feedback.

6) Arrange interview (this is the easy bit)

7) Feedback from interview ( see point 5, but double it because contractors often disappear after IV as well).

8) Negotiate price with client.

9) Negotiate cost with contractor.

10) Faff about for 2 days because contractor and client want to pay and be paid the same amount.

11) Finally make agreement, and raise paperwork.

12) Faff about for 2 days because candidate doesn't feel they need to supply "all this information".

13) finally convince candidate that information is needed else there's no contract.

14) Issue contract, manage through to start date.

15) Check in weekly/monthly to find out how things are going.


And for all that hassle, how much do we get? Oh that's right, a measly 15% of the rate we sold the client - that's less than an IT reseller - for what is a significantly harder sell.

To support me, for 1 year in my current business, costs them somewhere in the region of £100,000 all told. That's before we've made any profit at all, and before you take into account that I want a personal cut of the money I make for the business. That means, that to make a profit of say £50,000 (not unreasonable for £100,000 worth of investment) - I've got to generate somewhere around £160,000 in GP (because I want £10k in commission!) - that means I have to run at least 10 people, for the WHOLE year, working everyday, at £75 per day margin.

But...if you've got £100,000 to spare to employ someone else, or can afford to be spending time doing your own BD instead of what you actually get paid to do, you feel free.

Until then, the moment someone requests someone I've introduced to them, I'll be charging a margin thanks.

Agents do a job that you a) CAN'T do yourself, b) Wouldn't WANT to do, c) would be ineffective at and d) don't need to do. If you can, then go and do it - if you can't, then shut up moaning, get on with what you're paid to do, and think yourself lucky that you probably earn double what both the agents, and the rest of the country does.

And this is what reinforces the delusion, all your effort and costs are in step 1 and chasing people who are busy and dont want to be hassled. This all serves you and not the contractor or the client. All your hapless antics do is annoy everyone involved. I can get the contracts drawn up and exchanged for £100 through a fill-a-form contract service and get no sneaky clauses. I can place the advert on Jobserve (it doesnt take a genius you know). I can read through the CVs or pay one of my devs a little overtime to do it for me. I can arrange an interview, it takes the same time on the phone to an agent as it does to a candidate, actually agents are harder to get hold of. The demand and supply both exist independent of what you do and in your absense they would find each other like they do throughout the business world. All this carp about business development is about you VS other agents and is not contributing to the quality of either the contractor or clients experience. All this guff above is desperate self justification but it is empty and you know it and we know it. Your costs are only high due to the fact it is expensive to insert yourself into a position where you are neither needed or even wanted most the time.

All that said I'll pay the commission for the convienience right up to the point that an agent start lying and cheating to further their own profits. Then i'll go elsewhere. I know enough to know potential candidates are scouring jobserve etc and don't care which agent is involved. I am not going to miss out on a stella candidate by going with another agent as the smart contract is applying to all the adverts.

If you take all the effort out of the above list that relates to purely promoting yourself and your business you'll realise there is very little left. I would be more cautious about how loudly I screamed about it if I was you. I don't begrudge you your business, it fills a hole, but don't try and convince us all the desperate BD is for our benefit and not yours, we're geeks, not idiots.

Edit : Oh and regarding the "determined that the job doesn't require what's on the spec, because their experience will see them through". What makes you think you have the technical knowledge to know if a relevent complimentary skillset that is not specific to the specification will be of interest to the client. You are the least qualified person to make that determination. Believe it or not a numpty noob with 12 months experience in the precise skillset is a lot less desirable than a 10 year senior developer working with similiar technologies. Sure I dont want someone with no experience in that area at all but somethings are very transferable (e.g. a WPF dev for a silverlight role). You don't even understand the jobs you are recruiting for. So not only are some agents over priced, arrogant and deceitful, they are pretty much the weak link in the chain too. This is probably why all the CVs I get sent through are garbage.

[TykeMerc]

I wish there was a 'like' or 'agree' button! Thanks to you both, exactly what I was trying to say.

Literally speaking there is, it's the Reputation icon at the bottom left of each post which has approval or disapproval radio button options and space for some comment text.

[eek]

I think the solution is not to have opted out so I would spend some time arguing the point that the opt out is invalid.

Getting a solicitor's letter stating that fact should solve the issue quickly.

[The Agents View]

Plus - whoever it is who Neg repped me, stating "learn to write in english" might want to consider:

a) A trip to Specsavers.
b) Using Capitals at the start of a sentence, and the name of our country.
c) Use of a full-stop.

Oh the irony.

[The Agents View]

Cut the agent off the contractors gravy train? This is what gets me about agents, they are surely delusional. The contractor is working 8 hours a day every day, the agent probably puts in 5 mins a week after its all setup, so who's the one riding the gravy train? Its not the agents skills that fulfil the need. This idea that a small introduction and a little paperwork entitles an agent to an eternity of commission needs a reality check. The barmy days of bottomless budgets are over. Convienience will give way to cost efficiency and if agents don't change their tune employers will go direct. Lets face it, given the three parties involved, only the agent is optional.

Do you have ANY idea how much work is involved in each person you place as an agent? Allow me to give you an idea.

1) Agent has to find the job. This can be a case of hammering a phone for hours, it can be networking, it can be referral, it can be relationship driven, but one method will not deliver the volume of business required to be successful - so we probably spent 50% of our time, seeking new contracts - average cost probably in the region of £50k PA Per Consultant when you take into account salaries, benefits, Business intelligence tools, networking events, advertising etc

2) Agent has to then find the candidates for the role. Costs here include advertising, spending time weeding out the imbeciles who can't read a job spec, or are determined that the job doesn't require what's on the spec, because their experience will see them through (seriously - if I say I need something, my mind is unlikely to be swayed if you don't have it - why would you think I haven't pushed back on the client to find out if specifics are essential?), Job board access (probably costs around £1000 PA, per consultant judging by our budget vs. no. of consultants) - LinkedIn, Networking, referral, chasing people who don't answer their phone.

3) Speak to candidate re: Opportunity - 50% at the minimum aren't interested.

4) Prepare and pitch CV once interested, interesting person is found. Whether referenced up-front, or pitch prepared, there is always an element of cost involved in preparing the CV to go across

5) Chase client for hours on end waiting for CV feedback.

6) Arrange interview (this is the easy bit)

7) Feedback from interview ( see point 5, but double it because contractors often disappear after IV as well).

8) Negotiate price with client.

9) Negotiate cost with contractor.

10) Faff about for 2 days because contractor and client want to pay and be paid the same amount.

11) Finally make agreement, and raise paperwork.

12) Faff about for 2 days because candidate doesn't feel they need to supply "all this information".

13) finally convince candidate that information is needed else there's no contract.

14) Issue contract, manage through to start date.

15) Check in weekly/monthly to find out how things are going.


And for all that hassle, how much do we get? Oh that's right, a measly 15% of the rate we sold the client - that's less than an IT reseller - for what is a significantly harder sell.

To support me, for 1 year in my current business, costs them somewhere in the region of £100,000 all told. That's before we've made any profit at all, and before you take into account that I want a personal cut of the money I make for the business. That means, that to make a profit of say £50,000 (not unreasonable for £100,000 worth of investment) - I've got to generate somewhere around £160,000 in GP (because I want £10k in commission!) - that means I have to run at least 10 people, for the WHOLE year, working everyday, at £75 per day margin.

But...if you've got £100,000 to spare to employ someone else, or can afford to be spending time doing your own BD instead of what you actually get paid to do, you feel free.

Until then, the moment someone requests someone I've introduced to them, I'll be charging a margin thanks.

Agents do a job that you a) CAN'T do yourself, b) Wouldn't WANT to do, c) would be ineffective at and d) don't need to do. If you can, then go and do it - if you can't, then shut up moaning, get on with what you're paid to do, and think yourself lucky that you probably earn double what both the agents, and the rest of the country does.

[Wanderer]

Then as I say, the client is the one with the problem here. I still need food and water on the table, but if I don't have any money because my wife has spent it all, then I can't walk into a supermarket and either help myself, or demand that the stock is sold to me at cost price - its the same thing.

Let's be clear here - I don't begrudge the agent's their living and for all we complain about them they are a necessary part of us doing business. It's the way they do business that I don't like.

Name me one business reason why the agency shouldn't enforce this clause - not from your perspective, but from theres.

From an agent's perspective there is absolutely no reason why they shouldn't enforce the restraint of trade clause. The problem is that the whole agency business model is rotten to the core. The government even legislated against this very business practice that agencies hold so dear. Doesn't that make agents wonder if they are doing business in a pretty dirty way?

I don't say that the agent shouldn't be paid, just that there should be a restriction on how long they can enforce this restraint of trade against workers. Indeed there is now a restriction enshrined in law but stupidly the PCG negotiated an opt out to this which allows them to signing their rights away, a massive own goal for the PCG in my opinion.

4, Go back to the annalogy of a supermarket. They won't sell you an item at cost, just because your wife says that the shopping budget is a bit tight this month - it's the same thing - you want something, you have to pay for it - negotiate by all means, but have more ammunition than "oooh moneys a bit tight".

Yes, let's take the supermarket analogy. An agent introduces a potato grower to a supermarket. For as long as that grower is selling spuds to the supermarket, the agent gets 10p a bag. Further more, if the grower makes a deal with any other part of the supermarket's business then they have to pay a fee to the agent too. This could go on for years and the agent still takes their money. Let's see some of the restrictions and how wide ranging they are:

This is how the contract reads .....
7 PROTECTION OF ABC’S BUSINESS
7.1 The Service Provider shall not alone or jointly with another or others in any capacity and whether or not for its benefit and whether directly or indirectly:
7.1.1 either during the term of this Agreement or for a period of twelve calendar months after the date of termination or expiry of this Agreement:
7.1.1.1 enter into (or approach with a view to entering into) a similar contract of service or for services with:
(a) the Client; or
(b) any member of the Client’s Group; or
(c) any other person for whom, or with whom, the Service Provider and/or the Consultant had material contact

5, The OP SIGNED THE CONTRACT - there's no "unreasonable" clauses in there - THE CONTRACT IS SIGNED, AND THEREFORE AGREED - it's not like they've changed it and not told the OP - that's the contract!!

The enforceability of the restraint of trade in the contract is a matter for the courts to decide.

And yes, it's the contractor's decision to opt out or not opt out and that's true but basing a core part of the business model on people signing away their statutory rights is a filthy dirty business to be in. I know agents don't give a tulip about that, but this is why so many people hate them.

Why don't agents take an introduction fee to cover their expected income and then a small percentage to cover the costs of factoring the payments and be done with it. Forget this dirty business where the fees are hidden and profits depend on how much they can take from the contractor and the client. I'll tell you why they don't because they are a greedy bunch and they don't care that it's a dirty business.

Yeah I'm gonna get -ve repped for that and I know we should hate the game not the players but agents are the ones who can change it if they want to.... But they won't so there we are.

Folks, another sad story from a contractor who opted out from the agency regulations. Not the first nor will it be the last. Don't sign the opt out unless you are SURE you know what you are doing.

[suewood27]

From the agencies perspective they're prevented from getting further work and earning opportunities in the future because of a client restriction on external hires via agencies. It would make far better business sense for them to step aside in this case (as they won't be asked to fill the role anyway) and gain a feather in their cap by being cooperative. That feather may pay off when the clients restriction is lifted.
Either way they won't earn a bean from this opportunity, the only plus the agency can gain is client goodwill, by blocking the client and contractor they just annoy both and risk being dropped from the client PSL.

Cut the agent off the contractors gravy train? This is what gets me about agents, they are surely delusional. The contractor is working 8 hours a day every day, the agent probably puts in 5 mins a week after its all setup, so who's the one riding the gravy train? Its not the agents skills that fulfil the need. This idea that a small introduction and a little paperwork entitles an agent to an eternity of commission needs a reality check. The barmy days of bottomless budgets are over. Convienience will give way to cost efficiency and if agents don't change their tune employers will go direct. Lets face it, given the three parties involved, only the agent is optional.

I wish there was a 'like' or 'agree' button! Thanks to you both, exactly what I was trying to say.

[terradev]

Delusional

So let me get this straight.

Agent introduces you to their client.

As a result of introduction, and your good work, you secure additional contract.

You want to take 100% of this revenue, and cut the agent off of your gravy train?

Cut the agent off the contractors gravy train? This is what gets me about agents, they are surely delusional. The contractor is working 8 hours a day every day, the agent probably puts in 5 mins a week after its all setup, so who's the one riding the gravy train? Its not the agents skills that fulfil the need. This idea that a small introduction and a little paperwork entitles an agent to an eternity of commission needs a reality check. The barmy days of bottomless budgets are over. Convienience will give way to cost efficiency and if agents don't change their tune employers will go direct. Lets face it, given the three parties involved, only the agent is optional.

[The Agents View]

From the agencies perspective they're prevented from getting further work and earning opportunities in the future because of a client restriction on external hires via agencies. It would make far better business sense for them to step aside in this case (as they won't be asked to fill the role anyway) and gain a feather in their cap by being cooperative. That feather may pay off when the clients restriction is lifted.
Either way they won't earn a bean from this opportunity, the only plus the agency can gain is client goodwill, by blocking the client and contractor they just annoy both and risk being dropped from the client PSL.

1, There's ALWAYS a way past a PSL - it's a PREFERRED suppliers list, not an exclusive.
2, Point taken re: goodwill, and this IS important, but in equal measures, so is standing up for your business. Which one will stand you in good stead? well that's a close call - if you roll over, the individuals will expect you to do it again and again - if you don't, you're obstructive.
3, The agent should be earning from this - there's no two ways about it. If the client can't engage the resource, then they can't have the contractor - it really is that simple.
4, Go back to the annalogy of a supermarket. They won't sell you an item at cost, just because your wife says that the shopping budget is a bit tight this month - it's the same thing - you want something, you have to pay for it - negotiate by all means, but have more ammunition than "oooh moneys a bit tight".
5, The OP SIGNED THE CONTRACT - there's no "unreasonable" clauses in there - THE CONTRACT IS SIGNED, AND THEREFORE AGREED - it's not like they've changed it and not told the OP - that's the contract!!

[TykeMerc]

Name me one business reason why the agency shouldn't enforce this clause - not from your perspective, but from theres.

From the agencies perspective they're prevented from getting further work and earning opportunities in the future because of a client restriction on external hires via agencies. It would make far better business sense for them to step aside in this case (as they won't be asked to fill the role anyway) and gain a feather in their cap by being cooperative. That feather may pay off when the clients restriction is lifted.
Either way they won't earn a bean from this opportunity, the only plus the agency can gain is client goodwill, by blocking the client and contractor they just annoy both and risk being dropped from the client PSL.