Finance Recruitment Terms of Business UK | FCA-Sector Agency Contract
Finance recruitment agencies face a specific risk that generic terms of business simply do not address: placing candidates into FCA-regulated roles without proper contractual protection exposes the agency to liability for misrepresentation, fee disputes, and compliance failures. A dedicated finance recruitment terms of business sets out the agency's obligations, candidate warranty requirements, fee structures, and what happens when a placed candidate leaves during the rebate period. Under the Conduct of Employment Agencies and Employment Businesses Regulations 2003, agencies must provide written terms before supplying workers. Late payment protections under the Late Payment of Commercial Debts Act 1998 should also be included to protect agency fees. Whether you place interim finance directors, compliance officers, or FCA-authorised advisers, the right contract protects your revenue and your reputation. Generate yours now.
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Key clauses in a Contract
FCA Suitability Warranty
This clause requires the client to confirm that the role being filled requires FCA authorisation or registration, and that the client accepts responsibility for verifying a candidate's FCA status on the Financial Services Register before appointment. Without this, an agency can be exposed to negligence claims if a placed candidate lacks the necessary permissions under the Financial Services and Markets Act 2000.
Fee and Rebate Schedule
This clause defines the placement fee as a percentage of the candidate's total remuneration package and sets out a sliding-scale rebate if the candidate leaves within an agreed period, typically eight to twelve weeks. It also triggers statutory interest and debt recovery compensation under the Late Payment of Commercial Debts Act 1998 if the client fails to pay the invoice within the agreed terms.
Candidate Introduction Ownership
This clause establishes that once a candidate has been introduced to a client, the agency retains the right to its fee if that client engages the candidate directly within twelve months, even outside the original role. This protection is essential in finance recruitment where clients frequently approach shortlisted candidates through LinkedIn or other channels after the formal process has ended.
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Generate free →Frequently asked questions
Do finance recruitment agencies need separate terms of business for contract and permanent placements?
Yes. Under the Conduct of Employment Agencies and Employment Businesses Regulations 2003, agencies operating as an employment agency for permanent placements and as an employment business for temporary or contract workers are subject to different regulatory requirements. Separate terms should be used because the fee structures, obligations to the work-seeker, and client protections differ significantly between the two models.
Can a finance recruitment agency charge a fee if the client hires the candidate after rejecting them initially?
Yes, provided the terms of business include a clearly drafted introduction fee clause that covers any engagement within a defined period, typically six to twelve months from the date of introduction. Courts have upheld such clauses where the introduction was the effective cause of the eventual engagement, even if the hire came through a separate route. The clause must be clear and must have been accepted by the client before the introduction took place.
What should finance recruitment terms of business say about IR35 and off-payroll workers?
Where a finance agency supplies contractors to medium or large private sector clients, the client is responsible for conducting the IR35 status determination under Chapter 10 of the Income Tax (Earnings and Pensions) Act 2003, as amended by the 2021 off-payroll working rules. The terms of business should include a clause requiring the client to provide a Status Determination Statement before the engagement begins and indemnifying the agency against any HMRC liability arising from an incorrect determination made by the client.
The information on this page is for general informational purposes only and does not constitute legal advice. Contracto generates AI-assisted contract templates — they are not a substitute for advice from a qualified solicitor. For high-value or complex engagements, always seek independent legal review.