Resource Solutions, a division of the Robert Walters group, has been accused of trying to enforce oppressive contractual terms on agencies. The contracts issued to agencies on the preferred supplier list (PSL) Resource Solutions manages for a large blue-chip client are ‘commercially impossible’, according to a director at one of the companies.

A number of companies on the first tier of the PSL are likely to refuse to sign the contracts, industry sources suggest. Agencies must accept ‘unlimited liability’ for contractors under the terms of the contract, rather than a shared arrangement between contractor and agent or agent and managing agent. ‘This is an uninsurable liability,’ one company told Professional Recruiter.

Further conditions exempt Resource Solutions from paying agencies until it is paid by its client. ‘We’d still have to pay contractors - we could be talking half a million pounds of credit here,’ claimed the source. As a subsidiary of Robert Walters, Resource Solutions is thought to be worth as little as £1600.

Most large agencies have access to legal advice, but the second tier of smaller agencies on the PSL ‘may not seek legal advice and could see this as too good an opportunity to turn down,’ said the source. ‘If a smaller agency undertook this liability it’d only take one or two claims to put it out of business.’

Resource Solutions refused to comment on the contract. ‘We are currently in discussions with a number of suppliers concerning a commercial agreement,’ said Chris Ford, legal counsel for Robert Walters. He conceded that ‘some suppliers have raised concerns about elements of the agreement’.

Andrew McNeilis, previously MD of Resource Solutions, resigned on 20 July with immediate effect ‘to pursue other interests’, the company claimed. Sources say he has already accepted another recruitment job.