Agency restricting permanent employment offer

Short answer

No. A recruitment agency cannot lawfully stop you, the worker, from accepting a permanent job with the company (the hirer) where it placed you. Any restriction on your freedom to take up work directly with the client falls foul of the rules governing employment businesses. The real legal question is not whether you can take the job, but whether the agency can charge the hirer a fee, or require an extended hire period, when the client takes you on. That is a matter between the agency and the company, not between the agency and you.

The legal framework

The position is governed by the Conduct of Employment Agencies and Employment Businesses Regulations 2003, particularly Regulation 6 and Regulation 10.

Regulation 6 prohibits an employment business from subjecting a work-seeker to any detriment, and from making the provision of services conditional, in a way that stops or deters you from taking up permanent employment. In practical terms, an agency cannot penalise you or refuse to supply you because you want to go permanent with the client.

Regulation 10 deals with what the agency can charge the hirer, not what it can do to you. It allows an employment business to charge a “temp-to-perm” transfer fee to the client in certain circumstances, but crucially the contract must give the hirer the alternative option of an extended period of hire instead of paying a fee. If the contract does not offer that alternative, the fee is unenforceable against the hirer.

So the constraint sits on the client, who may face a fee or an extended assignment, and on the agency, whose ability to charge is limited. It does not give the agency any right to block you.

When the agency can charge the company a fee

Based on the current GOV.UK guidance, an employment business can only charge the hirer a transfer fee if all of the following apply:

1. The contract with the hirer gives them the option to extend your assignment instead of paying a fee.

2. The hirer does not take that option to extend the assignment.

3. The hirer gives you a permanent job within the relevant time limit, which is less than 8 weeks after the end of your assignment, or less than 14 weeks after it started, whichever is later.

If you had more than one assignment with the same client and there was a gap of more than 42 days between them, the later assignment is treated as a fresh first assignment for these purposes. After the relevant period has passed, the agency can no longer charge a transfer fee at all, and the client can simply take you on.

What this means in practice

You are free to accept the permanent role. Any clause in the agency’s terms that purports to prohibit you personally from working directly for the client, or that threatens you with a penalty for doing so, is not enforceable against you as a temporary work-seeker under the Conduct Regulations. Restrictive covenants of that kind bind the client’s contract, not your right to earn a living.

The most likely real-world friction is that the client may hesitate because the agency is claiming a transfer fee. Points worth checking are whether the agency’s contract with the client actually offered the extended-hire alternative, because if it did not, the fee is unenforceable; whether the relevant 8 or 14 week window still applies, because if enough time has passed the agency loses the right to charge; and whether you personally ever “opted out” of the Regulations, noting that the opt-out relates mainly to Regulation 32 payment provisions and does not entitle the agency to block a permanent move.

Missing facts that could change the answer

The precise outcome depends on several things you have not yet said. It matters what your own contract with the agency says, and whether you were engaged as a temporary worker supplied by an employment business or introduced as a permanent candidate by an employment agency, because the fee rules differ. It matters when your assignment started and ended, how long you have been placed, and whether the client’s contract with the agency offered the extended-hire option. If you can share the relevant clauses of both your agreement and, if you have sight of it, the client’s terms, the analysis can be made more precise.

Practical next steps

1. Read your agency agreement and note any clause said to prevent you going permanent or imposing a penalty on you.

2. Ask the client whether the agency is asserting a transfer fee, and if so, whether the agency’s contract offered the extended-hire alternative required by Regulation 10.

3. Work out the dates of your assignment to see whether the 8 or 14 week window has expired, in which case no fee is payable.

4. If the agency is threatening or pressuring you personally, you can raise a complaint with the Employment Agency Standards Inspectorate, which enforces the Conduct Regulations, and you can seek support from ACAS or Citizens Advice.

5. Keep everything in writing, and confirm any agreement about your move to permanent employment by email so there is a clear record.

In short, the agency’s leverage is directed at the company through a possible fee, not at your right to accept the job. Provided the client is willing to resolve any fee question with the agency, you are entitled to take the permanent role.