Contractors free to choose umbrella company or alternative solutions

Contractors are within their rights to challenge an agency's choice of umbrella company if they wish to do so, an expert has advised.

Nigel Musgrove, a lawyer at Cousins Business Law, explains that some agencies attempt to persuade contractors to select an umbrella company from a preferred list.

However, he explained that this can only be insisted upon if it is actually written in the contract, otherwise agency workers are free to work whatever terms they wish.

Mr Musgrove explained that the law will only be required to step in if the contract contains an 'unreasonable' term which can be cited by the agency.

Any such dispute between contractor and agency would then be considered on a case-by-case basis by the court.

"I suggest you approach the agency and set out compelling reasons why you should be allowed to operate through a different organisation," he said.

"If you cannot convince them to amend the contract, you will either have to comply with their terms, or terminate the contract in accordance with its termination clauses, and then find another agency willing to agree to use one of your organisations."