Employment agency / Payroll company

When employed by an agency, I work as a Ltd Co contractor (rather than as a PAYE contractor). I then use the services of a payroll company to manage my
expenses and deductions.
However, when I applied for a temporay position advertised recently, an agency told me my employment was conditional on using their payroll company, not my own.
Is it legal for an agency to impose these terms - ie. pending a job offer, demand that I contract with another party in addition to themselves?
I can't afford to turn away work, but the potential for abuse here is such that I've had to and hope this is an isolated case.
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Not if the payroll company makes a charge to you, no.
see
http://www.opsi.gov.uk/si/si2003/20033319.htm#5
tim

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tim..... wrote:

A payroll company doesn't work for free.
I think I'll continue this matter with their advertiser then.
Thanks.
[...]
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but their charge could be picked up by the agency.
tim
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It doesn't work like that.
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It used to
tim
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If it doesn't work like that and you have to pay them for the payroll services which they insist you take up then they are breaking the law.
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