'My contract was terminated without notice after the first month, when the Client found one of its permanent employees was available and wanted to put him on the project instead of me.'
I've read your contact. It's between the agency and your company, and provides that your company will 'carry out the Services by providing the services of such competent personnel as shall be required by the Client…efficiently to carry out such services', for a 6 month period. You are named in the schedule under the heading 'Personnel'. 'The Services' are defined in the schedule as 'Test analyst'.
The agency had the express right to terminate the contract without notice if 'there shall be serious misconduct or any breach or series of breaches of this agreement by the subcontractor or its Personnel', or otherwise on 4 weeks written notice.
One month into the contract, the team had not yet started testing. You had been asked to write two preliminary reports, but were told not to present the second report because it had not yet been reviewed. The Client then told you that your services were no longer required, claiming that your background and qualifications did not match up with the implementation plan; that they were unhappy with your accomplishments; and that you were not a PC guru and had spent some time making calls to agencies whilst on the job.
You heard nothing from the agency until some weeks later, when they wrote and said that the client had served immediate notice on them to terminate, giving the reasons as lack of confidence in your abilities, productivity much lower than expected, lack of PC skills slowing down other team members, communication problems leading to need to repeat instructions and work not being carried out as expected, and excessive amount of time calling other agencies.
The agency claims that they were entitled to terminate for your 'serious misconduct' and/or breach of the agreement, by failing to provide 'competent personnel'.
Has the contract terminated?
The contract was between your company and the agency. You were told by the client that it no longer required your services. Any discussions with the agency on the subject occurred later, and they did not put anything in writing until much later.
You accepted the Client's instruction to leave the site and not return - not that you had much choice! By doing so, it seems to me that you accepted the contract had been terminated. It seems clear that the agency knew what was happening. I think it is clear that it was understood by all that the contract was at an end. You would not be required (or permitted) to provide any further services.
Was the termination lawful, or in breach of contract?
Here, we have to look at what was said to you at the time, and at what was later put in writing to you - making due allowances for the fact that something raised for the first time at a later date may be less credible!
The agency could have terminated the contract without notice in the event of 'serious misconduct or any breach… by the subcontractor or its Personnel'.
Failure to provide 'competent Personnel' would be such a breach. This should be judged against the services which your company had contracted to provide - those of a 'test analyst'.
Whether your 'background and qualifications' matched their implementation plan is in my view irrelevant - the agency saw your CV before offering you the contract. They got what they bargained for. If they later decide they want something different, that's their problem.
Saying that the client was unhappy with your accomplishments, or lacked confidence (a very woolly claim, easy to make, but what does it mean?) does not stand up to me, given that they did not even look at a substantial part of your work, telling you to withhold presenting it because it had not been reviewed. In any case, it wasn't a term of the contract that the Client would be happy with your accomplishments, or would have confidence in you. So no breach here.
Communications problems work both ways. The person communicating information has a responsibility to see that the attempt to communicate has been successful. PC skills, for a mainframe person, engaged as a test analyst might well be thought to be a minor issue. Likewise productivity, given that the 'test analysis' hadn't even begun.
All we are left with then is the question of the phone calls. This really is a question of degree. I can't see that a couple of 5 minute calls in a day would be enough to amount to a breach justifying immediate termination. 2 hours a day on the other hand might be.
It seems to me that the agency probably did not have sufficient grounds to justify termination without notice. Their liability for damages is limited to what they would have been liable for, had they terminated the contract lawfully at that point - ie, on 4 weeks notice.
You would have to give credit for anything else you earned during that 4 week period, and to show that you had made efforts to try and find a replacement contract as soon as reasonably practicable.
If they don't pay you, you should seriously consider taking legal action against them in the County Court.
26th 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.
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