Oskar,
The answer is yes!
I can absolutely empathize with the contractors that have been let go, it must be a very difficult position that they have been left in, however, as unethical as it may be the agencies are not breaking any rules, I know, I am a contractor and in my contract it says they can let me go with one months notice, however far into the contract I am. It is the risk that all contractors face, that’s why they receive more money.