Breaking the Letter Of Commitment With Recruitment Agency

[ttan775]

I applied for a permanent position with company A, BGC the recruitment agency was the third party company that helped company A to source for candidates. So I responded to a job posting on jobstreet posted by BGC, I went for the interview and was selected for the job.

So I have a contract with company A that I signed and I also have a letter of commitment with BGC that I signed.

Anyways I have started on the job with company A, but I find that the job is not suitable for me. There are a few reasons (including the agency and the company not being very truthful with the job description) but I would rather keep this post short.

Basically my contract with company A states that I only have to give them one month's notice failing which I have to compensate 1 month's salary. But my letter of commitment states that I cannot resign within 3 months, if I do I will have to compensate BGC 1 month's salary. I fully intend to serve the 1 month's notice period with company A but as the 3 months period has not passed I will still need to compensate BGC.

So what can I do about this. I really cannot hold on for the full 3 months. has anyone broken the letter of commitment with the agency after giving the required notice as per contract with the company. Did the agency make you pay? Can BGC make me pay? Will they send a lawyer's letter or send someone from a collection agency to knock on my door to serve the lawyers letter. Can they sue me in small claims court?

Any help is greatly appreciated.

(This is not legal advice. You're advised to seek formal advice if necessary).

Just offhand and purely based on what you've told us, I'd say that the recruiter's position is not strong.

The letter of commitment is just that, a letter of "commitment". They will obviously try to characterize it as a breach of contract but I really doubt it will be seen as a contract between you and BGC if this goes to court.

The real contract is between the Company A and BGC: the former is paying the latter a specified sum of money for successfully placing you with BGC; probably BGC's commission is 3 months and a % of your salary with company A.

There are many issues with making a commitment between you and BGC contingent upon the employment & salary between you and company A, which is a matter between you and company A alone. What if your negotiated salary with company A was $1 a month? What if company A was the one that wanted you to leave and gave you 1 month's notice?

My first advice is to wait out the 3 months. If that is not an option, go ahead with the resignation but threaten to go on social media if they threaten to enforce the "commitment" letter. Recruiters are highly sensitive to reputation.

Letter of commitment is not that straight forward, it means both sides have agreed on the T&C in principle and will act as if the contract has been signed until the physical contract is ready to be signed.

Technically if the agency is able to prove to the courts that they have suffered damage due to your withdrawal, the court might award them damages accordingly. It is different from letter of intent which is less stringent and subject to further negotiation and no material change in circumstances.

Having said that, the best way is to negotiate with the agency and say you are willing to serve 1 month and ask them to waive the remaining 2 month notice. At the end of the day I doubt an agency will go the legal route unless you are a senior executive who has wide business level and confidentiality implications.

[seahhqy]

I've broken a bond with BGC before. It was years ago, so im not sure how is it like now.
I was just a little admin assistant (vacation job) at Great Eastern.

I quit within 1.5months when the contract was 3 months. Nothing happened to me. And i forgot how i went about telling BGC. But yea.. my story was.. just nothing legal happened to me. Maybe because i was a mere data entry person that would be easily replaced by anyone..

Not sure about your circumstances though.

Bets are, nothing will happen to you. Just suing you will cause more than money than it is worth. The lawyers fee may easily be 2 times your salary, and That is not courting the filing cost.

I had a similar story to share and need advice.

I had signed the letter of commitment (there is a clause which states I need to pay them Liquated Damages if I did not report for work on first day or resign within 90 days) with an agency and had signed the letter of appointment with company B.
However, after submitting my resignation to company A, company A has decided to counter offer me to stay.
I am in a dilemma. If I accept this counter offer and stay on in company A, would I be breaching the letter of commitment and need to pay the agency LD which is a few thousands dollars? Or nothing will happen to me other than the agency will blacklist me?

Any advice is appreciated. Thanks!

Originally Posted by Unregistered

I had a similar story to share and need advice.

I had signed the letter of commitment (there is a clause which states I need to pay them Liquated Damages if I did not report for work on first day or resign within 90 days) with an agency and had signed the letter of appointment with company B.
However, after submitting my resignation to company A, company A has decided to counter offer me to stay.
I am in a dilemma. If I accept this counter offer and stay on in company A, would I be breaching the letter of commitment and need to pay the agency LD which is a few thousands dollars? Or nothing will happen to me other than the agency will blacklist me?

Any advice is appreciated. Thanks!

Should be letter of intent (not commitment).

Originally Posted by Unregistered

I had a similar story to share and need advice.

I had signed the letter of intent (there is a clause which states I need to pay them Liquated Damages if I did not report for work on first day or resign within 90 days) with an agency and had signed the letter of appointment with company B.
However, after submitting my resignation to company A, company A has decided to counter offer me to stay.
I am in a dilemma. If I accept this counter offer and stay on in company A, would I be breaching the letter of commitment and need to pay the agency LD which is a few thousands dollars? Or nothing will happen to me other than the agency will blacklist me?

Any advice is appreciated. Thanks!

Anybody is able to provide advice for the above issue?

Originally Posted by Unregistered

Anybody is able to provide advice for the above issue?

Hi i have a family member in almost same situation as you.may i ask how was your case settled?

My opinion is that these agreements aren't binding and are hard to enforce. Theoretically, they can either (1) start a civil lawsuit to seek damages from you, or (2) go to small claims tribunal to make a claim from you.

To do (1), the legal fees will be exorbitant compared to the monetary damages they can possibly win from you, and they may not win. You need not worry about a getting a lawyer -- you can defend against yourself should the agency be stupid enough to sue you. And then please drag the process out to make sure the only winner is their lawyer. I'm just joking -- given that all these agencies are super money-conscious, they will not even want to get a lawyer to send you a demand letter. Speaking of demand letters, all you need is to send a simple reply stating "I reject your claims" and the agency will have to pay their lawyer one more time to send another letter.

This leaves us with (2). The small claims tribunal mediates disputes that involve claims of not more than $10k. My guess is that you can still try to show that the agreement is not fair and you may even attempt to counter-claim against the agency. Never back down!