Clients imposing agency terms – problem solved

Unsurprisingly many hirers have reviewed their contractor engagement policies since inception of the new IR35 rules in April this year. This review has in many cases extended not only to making decisions about whether or not to hire a company contractor but also to the general terms on which they are prepared to work with recruitment agencies altogether, bearing in mind risks and additional obligations arising from hiring non company contractors or umbrella workers. The result has been the issue by hirers of new sets of terms coupled with, in some cases, a refusal by hirers to continue working to terms provided by the agencies themselves.

“This adds further burden on agencies who, whilst comfortable working to their own terms, must now accept clients terms. These will always be designed to protect the client so introducing an entirely new risk area. Signing up to terms that may contain onerous provisions can seriously impact on fees entitlement, liability and, thus, profitability. Any set of terms may contain hidden provisions that could result in loss. A good degree of expertise is therefore required to properly vet these terms” says Ravi Murphy.

Ravi continued “whilst some agencies have in house support in this area, an independent review from employment and recruitment law experts can provide greater comfort. Not only will these experts be able to identify many of the ruses that are commonplace in the sector, but can provide detailed reports on problem areas with proposed options for change and further negotiation, such as the contract review service provided by my business Lawspeed. One set of terms mistakenly agreed can cost an agency months if not years of work.”

Ravi also warned about relying on confirmation of acceptability by insurance providers. “Some insurance companies ask to see client contracts before accepting them for cover. Care must be taken here because confirmation of acceptability to the insurance company is entirely different from confirmation that a contract does not contain risks the agency should be concerned about. Confirmation from an insurance provider will usually only extend to whether the terms of the policy cover the related risk, without reference to risks that may not be covered at all, or other matters such as fee protection.

Lawspeed provides ‘virtual in house’ legal expertise to help agencies overcome this and a host of other problems. “With 24 years of exposure to marketplace activity in the recruitment sector, we are well placed to spot the traps and pitfalls in client issued terms and provide solutions where possible (negotiations allowed). Backed by £3m professional indemnity insurance, we provide a rapid, cost effective and accurate turnaround (as our name indicates!), so putting our clients in the best position to respond to client requests quickly and effectively.”

With a range of other services also available, including a new and unique contract management platform, Lawspeed provides a complete contract and compliance support solution to any agency.

Ravi concluded “Problem solved. Call us on 01273 236236 and see what peace of mind we can bring to you.”

About the author

Ravi Murphy is a Director of Lawspeed, and joined the company in 2000 after many years working with a Lloyds insurance broker and achieving her legal and business qualifications.