Late payment of invoices constitute breach of contract?

[Platypus]

I'm going to have to decide how to play it ....

I'll have to do some searches ...

You are owed money and you have some doubts as to their ability to pay. I'd demanding payment within 7 days NOW, then switch agency.

If you faff about you deserve what you get.

[PAH]

Thanks for the info/advice.

First time in over 10 years of contracting I've had serious issues with an agency not paying the invoices. Maybe it's a sign of the financial chaos and they're having difficulty staying afloat, getting overdrafts etc.

Found out today there's at least one other contractor on site through the same agency that's also got outstanding invoices. Not looking good.

Typical that it happened when I was moving home and didn't have access to my online banking, so was unaware of the earlier invoice not being paid, otherwise there's no way I'd have let it get as far as it has.

[Another Dodgy Agent]

Thanks for the info/advice.

First time in over 10 years of contracting I've had serious issues with an agency not paying the invoices. Maybe it's a sign of the financial chaos and they're having difficulty staying afloat, getting overdrafts etc.

Found out today there's at least one other contractor on site through the same agency that's also got outstanding invoices. Not looking good.

Typical that it happened when I was moving home and didn't have access to my online banking, so was unaware of the earlier invoice not being paid, otherwise there's no way I'd have let it get as far as it has.

Right this is one of those rare occasions when I would advise informing your client immediately. Explain that you and a.n.other are having problems getting paid. Why? Because of utmost importance to your client is that you get paid. They know that if you don't then the ramifications on your work and that of the project/programme of works will ultimately have a huge factor.

Also they can stop paying invoices from your agency (good money into bad). So the longer you leave this the longer this becomes a problem where you could lose out.

Naturally I would happily supply you with a contract (pre approved QDOS and Acountax/R35 PCG IR35 friendly contracts) and weekly payroll for a 4% margin charge to your client, but I suspect your end client will have an agent in line to "pick up" any stung contractors.

[PAH]

After having a good read through recent archives on here it's the first thing I'm going to do at work tomorrow, contact the guy in charge of the contracts at the client, just to let him know of the situation, and my concerns.

Hopefully the kick from both myself and the client will get the agent to pay up, if they're able. If they're not, then it seems (from reading the archives) the best course of action is to try to get the client to terminate their contract with the agency and allow me to work through a different agency if they don't want to entertain me going direct.

I'm aware this course will probably mean any timesheet hours and invoices relating to them will still be due to the current agency until the client/agent contract has terminated, so if they are having cash flow problems and become insolvent, there's not much chance of getting any of the money they owe, and I may have to work the notice period on those dodgy grounds.

It also could result in me having to look for another contract if the client doesn't want the hassle of potentially having my current agency chasing them on legal grounds. Oh well, I'm sure there's lots of work out there at the moment.

[Another Dodgy Agent]

After having a good read through recent archives on here it's the first thing I'm going to do at work tomorrow, contact the guy in charge of the contracts at the client, just to let him know of the situation, and my concerns.

Hopefully the kick from both myself and the client will get the agent to pay up, if they're able. If they're not, then it seems (from reading the archives) the best course of action is to try to get the client to terminate their contract with the agency and allow me to work through a different agency if they don't want to entertain me going direct.

I'm aware this course will probably mean any timesheet hours and invoices relating to them will still be due to the current agency until the client/agent contract has terminated, so if they are having cash flow problems and become insolvent, there's not much chance of getting any of the money they owe, and I may have to work the notice period on those dodgy grounds.

It also could result in me having to look for another contract if the client doesn't want the hassle of potentially having my current agency chasing them on legal grounds. Oh well, I'm sure there's lots of work out there at the moment.

Not necessarily.

Real life situ occured with my client (I wrote about this on a previous thread). We reached agreement with the client that we would "payroll the affected contractors", we also agreed with the client that they would pull curent payments to 'crap agency' and pay us instead so that we could then pay the contractor. We agreed in that we would pay the contractor in advance regardless (as they had not been paid for 3 months) and if necessary from the profit on 4% margin would eventually recoup any loss.

So on the basis that your client wishes to retain you, if you have a good agency in place then you should realise most if not all of your money.

Now please vote for me on the other thread!

[PAH]

There's definately another agency being used by the client, so hopefully if it gets that far, the client and other agency will be willing to do what you suggest.

First steps I'm going to take, step one is already in motion:

1. Give the agency an ultimatum to pay outstanding invoice(s) with a near future deadline, after which I'll assume they are unable to pay unless they can give me a good enough reason for me not to assume that, such as paying the damn invoices!

2. Give my bosses here a heads up of the situation, so maybe they'll also apply pressure on the agency from their end, or at least be aware there's a risk of me (and any other contractors on site that I can find using the same agency and experiencing similar issues) not being available to continue their project(s) in the very near future if the matter's not resolved.

Then if payment is still not worthcoming, investigate the possibility of the client cancelling their existing contract and putting me through another agency (or direct).

Also maybe book some holiday with the client with immediate effect and start looking for another contract. That way at least I'm not working for nothing, and the client will become aware that I won't be returning unless a satisfactory solution is found.

It's the whole not wanting to piss off the client, but also don't want to be working for nothing (if that's what is actually happening and has been for the last couple of months) that I'm most wary off. Losing the money I should have received so far is also a worry, but it's going forward I'm most keen to sort out (the agency will either pay or not pay depending on the reason they haven't so far), so I'm not exposing myself to a bigger bad debt if that's what I'm facing.

[ASB]

I'm aware this course will probably mean any timesheet hours and invoices relating to them will still be due to the current agency until the client/agent contract has terminated, so if they are having cash flow problems and become insolvent, there's not much chance of getting any of the money they owe, and I may have to work the notice period on those dodgy grounds.

To the first point yes. The work you have done is as asset of the current agency. If it so happens they go down the tubes the IP will take no messing (they are in big trouble if they do). They will expect to collect the outstanding invoices from the client, they will expect to invoice for all work beyond there to the point of contract termination (often automatically triggered by insolvency).

Unfortunately of course the work you have done (whether invoiced or not) just makes you an unsecured creditor - so you will get whatever all the other unsecured creditors get. Often zip.

However, do check your contract. It does normally contain a clause revoking it in the event of anybody's insolvency. Also they are not going to be able to force you to work the notice etc anyway (but that might not stop them trying). You fiduciary duty as a directory would suggest that if you worked the notice period you are doing it in the knowledge you will not get paid. This is clearly something your shareholders would have a complaint about. If you refused to work the notice if the IP tried to make you there is very little chance they would have any success in the ensuing case for breach of contract they bought against you.

[PAH]

Yeah it all sounds like it could get messy if it comes to that.

Agent reckons one of the invoices should have been paid today, so hopefully the situation isn't as grave as it could be.

However I can't get into my online banking to check if it's just another stalling tactic as it's "temporarily unavailable due to technical reasons, please try later".

Until I see cleared funds in my account I'm not celebrating it being resolved just yet, they may still be experiencing cashflow issues that mean my other outstanding invoice and any work I'm currently doing may go unpaid. Trying to keep a positive outlook though.

[NotAllThere]

..."temporarily unavailable due to technical reasons, please try later"...

Conspiracy!

[Another Dodgy Agent]

Yeah it all sounds like it could get messy if it comes to that.

Agent reckons one of the invoices should have been paid today, so hopefully the situation isn't as grave as it could be.

However I can't get into my online banking to check if it's just another stalling tactic as it's "temporarily unavailable due to technical reasons, please try later".

Until I see cleared funds in my account I'm not celebrating it being resolved just yet, they may still be experiencing cashflow issues that mean my other outstanding invoice and any work I'm currently doing may go unpaid. Trying to keep a positive outlook though.

Nothing wrong with positive outlook! But you are responsible for credit control for your Ltd Co. As I tell our Credit Control person, 9am tomorrow morning get on the phone and chase those invoice payments. You need to be the same. Check your business account in the morning. If nothing in, then straight on the phone to the agent.