Breach of contract - Late payment - Advice?

[DodgyAgent]

"I may sound like I'm being harsh on the agency"
You are not, by signing the contract with that kind delay in payment you were being overly lenient with them. Once you are placed in contract agencies basically earn their margin rates for acting as a glorified factoring agent. By giving them such leeway on paying you they have basically been getting money for nothing as they probably have the same lead time in the client paying them, which means no exposure for them.

Honestly by sounds of things, unless this a major agency (which can be notorious for "admin problems"...funny that they are always in the agencys favor though) I would say this is an agency with cash flow problems, not something you want to be dealing with if you can avoid it but if you have to deal with them then minimise your exposure to an absolute minimum (max 10 working days)

If the client is aware of the problems try to get them to give you a copy of the contract they have with the agency then bring both contracts to your own lawyer and see what he recommends (and recommend they do the same)

If there is no decent solution recommended by the lawyers then sorry to say your best option is to start looking for a new position as to continue dealing with such an agency is just asking to get burned....big time

When people set up agencies they rarely consider cash flow simply because the problem grows as the agency grows. Most are started on a shoestring and the general attitude is to "wing it". This is what I did when I started my agency.

It is possible (in fact likely) that the agency is winging it. There may be little point in trying to wind the agency up with legal action but there is no harm in you being seen to throw your toys out of the pram and place yourself amongst the "we better pay him first" contractors.

They will also probably be using factoring companies who tend to pay up front 80% of the invoice value. This is why 20% is such an important target point for agency margins. If the agency is small and it has a lot of its contractors below 20% margins then you can expect problems. Worth checking companies house and seeing if they have retained earnings as it is worth if possible checking payment terms between client and agency.

[ratewhore]

There is legislation for late payment and I have used it successfully. See http://www.payontime.co.uk/ for details.

I would say though that 30 days is standard for a B2B contract payment terms so the legislation will only benefit you if they are beyond that. If you really want to push it at 20 days then I suppose breach of contract is the way to go. I personally wouldn't bother unless they were way over the 30 days...

[MarillionFan]

I am presently on 30 days B2B.

The agency I am through has never done contract they only do perm and I provided my own contracts to them.

They also know Im not that bothered about chasing them. Every now and then they say to me, we havent been paid by the client yet and every time I say to them. Not my problem.

30 Days is 30 days.

[tim123]

Let me guess the agency.

Is it a word that goes with board?

tim

[MarillionFan]

"There is legislation for late payment and I have used it successfully"

Bollocks. You have.

[Mustang]

I have used the late payment legislation - got paid over £700 in interest!!

[DS23]

It is possible (in fact likely) that the agency is winging it. There may be little point in trying to wind the agency up with legal action but there is no harm in you being seen to throw your toys out of the pram and place yourself amongst the "we better pay him first" contractors.

good post. the late payment legislation is all well and good but it won't help if the agency becomes insolvent. if the company is struggling then the best thing to do is to make as much noise as possible. as da says - make your presence felt so that you get paid first out of whatever is left in the pot.

don't worry about your status with the agency or client - stand up for your business!

[ratewhore]

"There is legislation for late payment and I have used it successfully"

Bollocks. You have.

Yep. Penalties and interest off Alexander Mann who were crap to say the least!! Of course, you have to deal with the organ grinder and not the monkey...

[oxtailsoup]

paid

Sent an email to the agency explaining my grieviances and they made a payment into my account which I should receive today. Admin misunderstanding.

Agent isn't one of the big boys but it isn't small either.

[DS23]

good o

that's a relief for you. well, it will be when the money hits your account.

i'd keep watching each payment like a hawk.