Rollover contract - is there anything I can do?

[Bex1775]

Hi, the company I work for has used an online HR company for some time. The original contract was signed 5 years ago this December. Since I began here (11 months ago) I've had cause to use them for an ongoing HR issue, but the service provided by them has been terrible. I've been passed to different members in their call centre (HR specialists) and not felt that there's been any continuation. This has led to bad/incomplete advice being given and left us in a mess. Due to this we decided we didn't want to continue with the service, and I approached them to find out cancellation procedure. I have been told we needed to give 6 months notice, which would have been June 21st. As we hadn't, we have been automatically signed up for 5 more years, and they refuse to release us, even if we offer to pay a penalty for early release. I've gone over the paperwork and no mention is made of the rollover in any of the introductory paperwork. The only mention is a tiny disclaimer on a digitally signed form which was signed by one of our directors and their sales rep.
Is there anything I can do to get us out of this? We are stuck paying nearly £200 a month for a terrible service we have no faith in any more.
The contract was signed when the now director was trading as a sole trader, although recent annual invoices have been made to the ltd company.
We are a small business, only 10 employees (this includes 3 directors)
I have complained about the service and one of their reps is meeting me tomorrow to go through in more detail (I only found out about the rollover yesterday, hence insisted we meet) hence thought I'd see if anyone has been in a similar situation, or if there might be any argument I can make that would get us out of this situation.
Thank you so much for reading.

 

[Newchodge]

There may be some mileage in it being a contract with the sole trader, not the ltd company, so the ltd is not liable. That leaves the sole trader being taken to court, which may help as it may be arguable that b2C rules apply and the rolling 5 year contract is unfair.

Have you formally complained about their gross incometence? If you have you may have grounds to claim you are entitled to cancel because they are in breach of their obligations.

 

[Newchodge]

Why have recent invoices been made to the ltd company? Was the contract transferred formally? There was a recent thread about PHS rolling contract. Have a look at that and perhaps contact the poster.

 

[Newchodge]

Have a look here https://www.ukbusinessforums.co.uk/...rphilly-contract-dispute.400121/#post-2951480

 

[Bex1775]

Hi and thank you for the replies, and the link to the thread, which I've just read through. I don't believe there was any formal handover to the ltd company, so that will definitely be a question I will ask.
I wasn't sure how that might work though, as we've obviously carried on paying and using their services. Is it worth trying to argue that the ltd company isn't bound by the rollover aspect of this contract?

I'm aiming to initiate the complaint with their representative tomorrow as it was my initial angle; that we can't continue using a company we no longer have faith in, hoping that they might agree to releasing us.

What tends to happen in cases like this, if we refuse to pay? I'm assuming they would take the company or the original director (who was sole trader) to court. Is there anything else I can read on the subject?

Thank you all again, much appreciated, and I will keep looking at this thread for any more comments.

 

[obscure]

I don't believe there was any formal handover to the ltd company, so that will definitely be a question I will ask.
I wasn't sure how that might work though, as we've obviously carried on paying and using their services. Is it worth trying to argue that the ltd company isn't bound by the rollover aspect of this contract?

I doubt that will work because you clearly have accepted the contract by using the service and making the payments.

What tends to happen in cases like this, if we refuse to pay? I'm assuming they would take the company or the original director (who was sole trader) to court. Is there anything else I can read on the subject?

Either nothing or you get sued. Generally, if you want to get out of a contract you need to show that...
a. It doesn't apply, or
b. They breached it.

Given that you formed a b2b contract a. is out so b. would be your best option. Simply stopping payment doesn't get you out of a contract it just puts you in breach and makes it easier for them to sue you for the full amount.

 

[Bex1775]

Hi again.
I've just had the meeting with the client manager from our HR company. He has taken on board my complaint and assures me he will escalate it. He did mention that if we can prove they have breached their contract then we will be able to walk away and not become tied in for another 5 years.
However, I have searched their website for any kind of terms and conditions, there are none, and he has told me there are none as yet (the company is not new)
He can provide no paperwork at all beyond what I have here (which is a schedule of payments with a copy of the client agreement attached) I was really surprised at this, as it doesn't state anywhere what we can expect from them, it just lists the details of service they provide. Is it really likely that nothing exists which details what level of service we should expect or what to do if we need to complain?
The client manager has asked that I don't email with my complaint as yet (I need to email it to him) but wait for his findings. I feel totally bemused at the moment.
Thank you for reading, and any thoughts would be welcome!

 

[obscure]

He can provide no paperwork at all beyond what I have here (which is a schedule of payments with a copy of the client agreement attached) I was really surprised at this, as it doesn't state anywhere what we can expect from them, it just lists the details of service they provide.

How can be it a surprise? You signed a contract with them 5 years ago - did you not go to their website (and screen grab a copy of any T&C) as part of your research into a company you were about to enter into a legally binding 5 year relationship with? What about the copy of the contract from 5 years ago - the details of service provided in that are what apply to your current contract so those are what you should rely on.... or did you actually sign a contract that had no details of the service they would provide (or worse yet just not bother to read it)?

 

[Bex1775]

Hi Dan, well as I thought I'd said, I wasn't working for the company when the contract was signed. Scrutinising contracts etc is something I always do, but obviously not everyone is like this. There are no terms and conditions on their website. I feel incredibly frustrated by the whole situation and desperately trying to find a way out, but there is none. Thanks for your helpful input

 

[Chris Ashdown]

Make full notes of your concerns about their service with dates and brief details

Go to a commercial solicitor and ask there advice as to your options and if the details you have provided are significant enough to be a breach of contract

As what happens if you stop paying and they take you to court and will the court award the full amount for the contract length or a lesser amount

 

[Root 66 Woodshop]

I don't get it... How can they bind you to a 5 year contract when there are no Term's and conditions?

Surely the contractual agreement should be backed up by their Terms & conditions otherwise they couldn't possibly force anyone to stay in a contract...

The client manager will probably be going back to head office, expressing the issue i.e. no terms and conditions and they'll be drumming some up as we speak...

personally, I'd be emailing them straight away with a cancellation email with immediate effect due to unfair trading as there are no T&C's to contest nor a termination clause.

What are they going to do? point you to T&C's that don't exist telling you you must give 6 months notice? nah... doubt it

 

[Newchodge]

(which is a schedule of payments with a copy of the client agreement attached)

Does that clearly state that there will ne a renewal for 5 years unless.....?

 

[Root 66 Woodshop]

A website doesn't need to have T&C's by law it's just good practice.

 

[Chris Ashdown]

If you have a contract B2B for a service and you stop paying for the contact before the end

1. Can the courts claim the fully amount of the contract
2. Can the court make allowances for the non use and therefor no work for the claimant

I understand on a lease the landlord can only charge whats outstanding up to when a new person takes out a lease on your old building, they also have to make a effort to get a new tenant

 

[STDFR33]

1. Can the court make allowances for the non use and therefor no work for the claimant

If you enter a mobile contract and do not use it, you still have access to the service. You would still be bound to the length of the contract.

I don't see how this would be any different.

 

[obscure]

If you have a contract B2B for a service and you stop paying for the contact before the end

1. Can the courts claim the fully amount of the contract

Yes

1. Can the court make allowances for the non use and therefor no work for the claimant

Why would they? They aren't working because the client breached the contract and refused to pay.