Recruitment Agency and Contractor situation

[LayZ]

All,

Have a situation at work and could do with some advice. We have a developer contractor under contract with us for 4 months, coming to the end of his term. We were referred him by a agency, let's call them ABC. Currently ABC are charging £360/day, and £300/day goes to him. I want to take him on directly for a 12 month contract, where we handle the payroll etc. To me it seems like after this contract is up, ABC have no claim on what he does or does not do, and surely we are free to employ him directly?

Here's the pertinent bits from the (anonymised) contract: http://pastebin.com/TSJFLmcj

ABC are suggesting that to do this we need to pay them a one-off fee of £10k, which seems frankly ridiculous to me.

I need to keep the relationship with ABC good, but to me this demand seems OTT. We've put a lot of work their way and will continue to do so.

Virtual for any help.

[LayZ]

Ok thanks guys, just wanted to understand if this was standard practice or not.

Guess I'll have to negotiate and see how far I get. It struck me that the wording in the contract was not clear in this situation - but then legalese rarely is!

[LayZ]

Frankthered said:

£10k seems a little high, but why not just continue with the current arrangement?

If we keep the current arrangement for the next 12 months they stand to make approx. 11k in fees.