Go Direct | Can you dump your agency and go direct?

Direct Contracting for IT Contractors
Direct Contracting for IT Contractors

Go Direct Contracting

With the Agency Workers Regulations (AWR) in effect for limited company contractors, we asked an expert whether IT contractors could then simply dump their agency and go direct. Here are their answers.

Go Direct Questions

1) As regards contractors who have current IT contracts, when it comes to their renewal time, are they free to talk to their clients about going direct and cutting out the agency?

2) It has been suggested that IT contractors can opt out, take a contract through the agency, and then opt out after they have started work. Is this correct? If so, it would mean that they could go direct at the end of their contracts.

Go Direct Answer

The client / agency contract resolves both of the questions.

If the Agency has terms with the client to say that the taking on of any contractor is subject to a fee or alternatively a new contract under the current terms, then this is allowable.

It does not matter what contract the supplier has as there cannot be any restrictions in the agency/supplier contract. However, they will not get the offer of a place by the client without a charge on the client.

Can Go Direct

If the agency has only got a restrictive clause in their agreement with their client and not a continued supply clause (due to apathy), then if the contractor has not signed an opt out, it does appear that they could go direct!

Again if someone opts out, then back in whilst in the contract as long as the agency  client contract has a continued supply and a placement fee alternative, they will be restricted in going direct by an allowed fee to the agency by the client.


ITContractor is not responsible for these opinions and you should take legal advice before taking any action.

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