'I was offered a position with a Client through an agency, but could not agree the rate. Meanwhile I was offered the same position through another agency at an acceptable rate - until the Client said it could not deal through the second agency because I had been introduced by the first. I declined the offer by the first - and lost the opportunity. Was the Client right?'
In general, people and companies are free to decide who they do and don't wish to deal with. There are, of course, exceptions.
A Client who allows considerations of race, sex (including marital status), or disability to unjustifiably influence his decision on whether or not to take a particular prospective contractor risks walks into a legal minefield. The 'remedy' for the 'victim' is to complain to the Industrial Tribunal. In general, these provisions apply not only to applicants for employment, but also to applicants for contract positions.
If the Client had a dominant position in the market, then it might be possible to try and argue that arbitrary discrimination between different trading parties amounted to an abuse of that dominant position, and was therefore contrary to Article 86 of the Treaty of Rome. The Client however would doubtless say that its decision was not arbitrary, but designed to avoid what it saw as the risk of liability to the first agency.
It seems to me that there are two circumstances where the Client might find itself liable to the first agency if it took you through the second:
The Client may have an existing contract with the first agency, providing eg that the Client will not take a contractor first introduced to them by the agency for a period following the introduction, other than through that agency. Whilst this would clearly be in restraint of trade, it would be enforceable if the agency could show that the provision went no further than was reasonable for the protection of the agency's legitimate commercial interests.
These interests fall into three types: business connection, trade secrets, and confidential information. Since the agency's core business is the introduction of contractors to clients, they could probably show that their business connection with contractors is such a legitimate commercial interest. They might also be able to show that the disclosure of your identity, skills and requirements to the Client was a disclosure of confidential information. If such a restriction is too broad - for example, if it sought to prevent the Client from ever taking such a contractor other than through that agency - then the term would be unenforceable. But if the period were reasonable - say three months - then the term could well stand up.
If there is no such existing contractual relationship between the Client and the first agency, then the remaining possible risk to the Client is under the law of confidentiality. Duties of confidentiality can arise independently of any contractual relationship. Briefly put, if someone receives information which is capable of being protected as confidential, and if at the time he receives it he knows that he is being given the information in confidence, then the law will require him to honour that confidence, and neither disclose nor make personal use of the information.
The agency could argue that the disclosure of your name and details was in confidence, and that the Client could not therefore legitimately make use of that information, other than by dealing with you through the agency.
Now this in my view could protect the agency if the client then decided to try and deal direct with the contractor - but I cannot see it going so far as to prevent the Client dealing with a second agency who, completely independently, introduces the same contractor.
So the conclusion I come to is that, unless there was an existing contractual relationship between the Client and the first agency as outlined above, there was no reason why the Client could not have taken you through the second agency. It is frankly ludicrous that a contractor should be prevented from dealing with the agency which offers the best terms. The Client either did not understand the legal position, or simply wanted to avoid giving offence to the first agency, or (most likely) did not want the hassle of becoming involved in a dispute, even if they were in the right. And - right or wrong - they were entitled to take that position.
The lesson for the Contractor is this: choose which agencies you register with care. There are times when it can be to your disadvantage to be registered with every agency in sight. Leave the agencies which are too greedy off your list!
12th June 1998
I'd really appreciate your feedback on this FAQ - so mail me and tell me what you think of it, if it's been useful to you, or let me know of any specific problem you have where I may be able to help.
[Return to Roger Sinclair's 'Welcome' page]
No liability is accepted for any inaccuracy in the information in these pages - see full disclaimer
© Roger Sinclair roger@egos.co.uk 1998 - All rights reserved - see full copyright details
The information on these pages is provided free and for information only, and is provided 'as is'. Whilst believed to be correct, it is in no way comprehensive. It is provided for your interest only and is not intended to be relied on as formal legal advice. The posting of information on these pages is not intended to create a lawyer-client relationship, and you should not act or rely on this information without seeking professional advice. No liability is accepted therefore for any errors, or for any losses that may be incurred if it is relied on.
You may read these pages on-line, and download them to read later, for your own personal use.
This copyright notice must appear on every page that you print from here.
You must not redistribute these pages or any part of them in any form or medium without first obtaining my consent.
You are welcome to set up links to this website from others.
[Return to Roger Sinclair's 'Welcome' page]