Can Your Agency Stop Clients Poaching Staff?

Can you stop a client from hiring your best designer, recruiter or account manager, or from going around your agency and dealing with your contractor directly?

Often, yes, but only if your contract is drafted carefully. A well-written non-solicitation clause can protect your team, your client relationships and your revenue without trying to lock everyone into an unrealistic non-compete.

For small agencies, this is one of those clauses that can feel a bit awkward to raise with clients. But if you rely on talented people and hard-won relationships, it's a normal commercial protection to have in your agency contract.

Can You Use A Non-Solicitation Clause In An Agency Contract?

Yes, you can usually include a non-solicitation clause in an agency contract, as long as it's reasonable and protects a genuine business interest.

For an agency, a non-solicitation clause is commonly used to stop a client from:

• approaching your employees to work for them directly
• hiring your contractors or freelancers outside your agency
• encouraging your staff to leave your business
• bypassing your agency and dealing directly with suppliers, candidates or talent you introduced
• soliciting your other clients, where that risk genuinely exists

You might see these called client poaching clauses, no-hire clauses, non-circumvention clauses or restrictive covenants. The label matters less than what the clause actually does.

Importantly, the clause should be a targeted protection for your actual agency relationship. It might protect genuine introductions, confidential information, goodwill or services you manage. It shouldn't be used as a reciprocal or market-wide agreement with competitors not to approach or hire each other's staff.

The Competition and Markets Authority has treated no-poaching arrangements between businesses as potentially anti-competitive, including arrangements that cover freelancers and contractors. Businesses should also avoid wage fixing, sharing sensitive employment terms, or agreeing not to compete for workers. If your client is also a competitor, or the restriction goes beyond protecting the agency relationship, it's worth getting specific advice before you use it.

Say you run a small digital marketing agency. You introduce a specialist paid ads contractor to a client, manage the campaign, deal with reporting and carry the commercial risk. Three months later, the client tells you they'll be ending the retainer, then quietly offers the contractor a direct deal at a higher day rate.

Without clear contract wording, you may be left arguing about what was implied or fair. With a tailored non-solicitation clause, you have a much clearer basis to say: that introduction and relationship belonged to your agency, and the client agreed not to go around you.

What Should A Client Non-Solicitation Clause Cover?

A client non-solicitation clause should cover the people, relationships and conduct you're actually trying to protect.

In an agency client contract, the clause will often say the client must not, during the contract and for a set period afterwards, directly or indirectly solicit, employ, engage or attempt to engage certain people connected with your agency.

The key details are usually:

• Who is protected: employees, contractors, freelancers, consultants, candidates, suppliers or other contacts introduced by you.
• What conduct is restricted: soliciting, approaching, hiring, engaging, inducing someone to leave, or accepting services directly.
• How long it lasts: a defined period after the contract ends, often shorter for junior staff and longer only where justified.
• What counts as an introduction: for example, people your agency introduced, managed or made available to the client.
• What happens if it's breached: a fee, damages, an account of lost fees or another agreed remedy that isn't a penalty.

Good clause drafting matters here. If the clause tries to cover every person your agency has ever worked with, for too long, in too many situations, it becomes easier for a client to challenge.

Example Wording Concepts

Your exact wording should match your business, but a sensible clause may say the client can't hire or engage your agency's personnel who worked on the client's account, or who were introduced to the client through your agency, for a set period after the agreement ends.

For a recruitment agency, the wording may also deal with transfer fees, introduction fees and when a client hires a candidate you introduced. This area has extra rules under the Conduct of Employment Agencies and Employment Businesses Regulations 2003, so the details need special care.

Can You Stop Clients Hiring Your Employees Or Contractors?

Yes, you can often restrict a client from hiring your employees or contractors, but the clause needs to be proportionate to the risk.

If your client has worked closely with your account manager, designer, developer, recruiter or consultant, there's a real commercial risk that they'll try to bring that person in-house. A targeted no-poach or non-solicitation clause can help protect your investment in hiring, training and managing your team, as long as it's linked to that specific client relationship and isn't really an anti-competitive hiring arrangement.

For employees, the client-facing contract is only one part of the picture. You should also check that your employment contracts include suitable protections, such as:

• confidentiality clauses
• intellectual property clauses
• post-termination restrictions for client solicitation, where appropriate
• staff non-poaching restrictions, where appropriate
• clear notice periods and garden leave wording, if you use garden leave

Under the Employment Rights Act 1996, employees must receive a written statement of key employment terms from day one. Restrictive covenants aren't just a tick-box addition to that statement. They need to be drafted carefully and accepted as part of the employment contract.

For contractors, your contractor agreement should line up with your client contract. If your client agreement says the client can't engage a contractor directly, but your contractor agreement says nothing about direct approaches, you may still have a practical problem.

What About Recruitment Agencies?

Recruitment and staffing agencies need to be especially careful because some transfer fee clauses are regulated.

Under the Conduct of Employment Agencies and Employment Businesses Regulations 2003, if you're an employment business supplying temporary workers, you generally can't charge a transfer fee unless the hirer has had the option of an extended hire period instead. There are also timing rules. Broadly, a transfer fee won't usually be allowed if the worker is engaged after whichever is later: 8 weeks from the end of the assignment, or 14 weeks from the start of the assignment.

That doesn't mean you can't protect your introductions. It means your recruitment agency terms of business need to be drafted with those rules in mind, rather than using a generic agency clause.

Are Non-Solicitation Clauses Enforceable In England And Wales?

It depends, but a non-solicitation clause is more likely to be enforceable if it protects a legitimate business interest and goes no further than reasonably necessary.

Under the common law in England and Wales, restrictive covenants can be treated as a restraint of trade. That doesn't automatically make them invalid, but it does mean the clause will be looked at closely.

Your agency will usually have a stronger position if the clause protects things like:

• client relationships and goodwill you've built
• confidential information, strategies, pricing or campaign data
• candidate, talent or supplier relationships you introduced
• stability of your workforce
• investment in training or account knowledge

The clause is more likely to run into trouble if it goes much further than that. For example, a 24-month restriction stopping a client from hiring anyone who has ever worked for your agency, even if they never dealt with that client, may be hard to justify.

What Does Reasonable Usually Mean?

There isn't one magic number that works for every agency. Reasonableness depends on the facts at the time the contract is agreed, including the person's role, the client relationship, the type of agency and the risk you're protecting against.

That said, useful factors include:

• Duration: 3 to 6 months is often easier to justify than 12 months, but a longer period may be possible in some B2B settings if the risk supports it.
• Scope: the clause should focus on people or clients the other party actually dealt with or was introduced to.
• Activity: stopping solicitation is usually more targeted than stopping all contact or all competition.
• Seniority: restrictions on senior client-facing staff are usually easier to justify than restrictions on junior or back-office staff.
• Commercial context: business-to-business contracts often allow more room than employee restrictions, but they still need to be sensible.

If a clause is too wide, you can't assume a court will simply rewrite it into something fair. In some cases, narrow wording can be severed, but you shouldn't rely on that. It's much safer to draft the clause properly from the start.

Is A Non-Solicitation Clause Better Than A Non-Compete?

Often, yes. For small agencies, a focused non-solicitation clause is usually more practical than a broad non-compete.

A non-compete tries to stop someone from working in a competing business or doing competing work. That can be a heavy restriction, especially in employment contracts, because it affects a person's ability to earn a living.

A non-solicitation clause is usually narrower. It doesn't say your employee, contractor or client can never do similar work. It says they can't target certain relationships, people or opportunities that your agency has a legitimate interest in protecting.

For example, rather than saying a departing employee can't work for any marketing agency in London for 12 months, you might say they can't solicit clients they personally dealt with in the last 6 months of employment for 6 months after leaving. That kind of drafting is more focused on the actual risk.

The UK Government has previously consulted on limiting non-compete clauses in employment contracts, including a proposed 3-month cap, but a general statutory cap hasn't become the everyday rule for all employment contracts. The safest approach is still to avoid relying on broad non-competes where a more targeted restriction would do the job.

What Other Agency Client Contract Terms Help Protect You?

A non-solicitation clause helps, but it shouldn't do all the heavy lifting on its own.

Your agency client contract should work as a practical safety net for how you sell, deliver and get paid for your services. Alongside a non-solicitation clause, you may want terms covering:

• Scope of services: what you're responsible for, what is out of scope and how extra work is approved.
• Fees and payment: retainers, project fees, expenses, late payment consequences and when invoices are due.
• Introductions and commission: when an introduction fee, placement fee or success fee is triggered.
• Intellectual property: who owns creative work, campaign assets, copy, designs, code or strategy documents, and when ownership transfers.
• Confidentiality: how both sides protect business plans, pricing, candidate details, briefs and trade secrets.
• Data protection: who is controller or processor under the UK GDPR and Data Protection Act 2018, and how personal data is handled.
• Termination: how either side can end the agreement, what notice is needed and what happens to unpaid fees.
• Liability limits: sensible caps and exclusions that reflect the value and risk of the work.

Templates often miss the commercial details that matter for agencies, especially if you use contractors, work under a retainer agreement or make introductions that could be valuable later. Your contract works best when it reflects how your agency actually makes money.

Liquidated Damages And Introduction Fees

You might want the contract to say the client must pay a fixed fee if they hire your employee or contractor, or if they engage a candidate you introduced.

That can work, but the amount needs care. Under English contract law, a clause may be challenged as a penalty if the amount is out of all proportion to your legitimate interest in enforcing the contract. A fee that reflects likely recruitment costs, lost margin or the value of an introduction is usually easier to defend than an arbitrary figure designed to punish the client.

Common Drafting Mistakes To Avoid

The biggest mistake is using a clause that's so broad it looks protective on paper but becomes hard to rely on when you actually need it.

Watch out for these common issues:

• Covering too many people: restricting all employees, contractors and contacts, even if they never interacted with the client.
• Using an excessive time period: choosing 12 or 24 months without a clear commercial reason.
• Forgetting indirect approaches: leaving a gap where the client uses a related company, recruiter or consultant to make the approach.
• Missing contractors: protecting employees but not freelancers, consultants or associates who deliver the work.
• Not matching documents: having a client contract, employment contract and contractor agreement that all say different things.
• Using penalty-style fees: setting a fixed amount that doesn't connect to your likely loss or legitimate business interest.
• Using a no-poach clause too broadly: agreeing with competitors, or near competitors, not to hire or approach each other's people.
• Sharing sensitive employment terms: discussing wages, rates, benefits or hiring plans with other businesses in a way that could raise competition law concerns.
• Forgetting data protection: sharing candidate, employee or contractor details without clear UK GDPR roles and handling rules.

You don't need a frightening contract to protect your agency. You need one that's clear, fair and commercially realistic.

Key Takeaways

• Non-solicitation clauses can help stop clients poaching your staff, contractors, candidates or key relationships.
• In England and Wales, these clauses are more likely to work if they're reasonable and protect a genuine business interest.
• The clause should be targeted to genuine agency introductions, confidential information or client relationships, not a broad no-poach agreement with competitors.
• A targeted non-solicitation clause is often safer and more useful than a broad non-compete.
• Your client contract, employment contracts and contractor agreements should fit together, especially if your agency relies on freelancers or introductions.
• Recruitment agencies need extra care because transfer fees and temp-to-perm arrangements are regulated.

If you'd like help with agency client contracts, non-solicitation clauses, contractor agreements or employment contract restrictions, you can reach us at 08081347754 or team@sprintlaw.co.uk for a free, no-obligations chat.