Progressive

[pippo]

Folks thank you all for your input /views,

The salient points I'm taking away from this are:

...

2. Ensure the terms of payment are clear in your contract and not hidden in a Master Agreement, between the Agency and Payroll company.

...

4. Don't accept / walk away from payment terms greater than 15 days, after submission of invoices, which allows Agencies to hide their financial difficulties or expose their greed.

5. Finally ensure you have legal cover in place, you never know what the cunning Accountant or unscrupulous Agency may have up their sleeves.

I couldn't agree more, especially in regards to the payment terms. I normally try and get the payment terms in writing from the agency before even going to any interview, so that if it turns out that their payment terms are greater than 15 days I will know it before having wasted time in attending the interview.

[ImNoddy]

Folks thank you all for your input /views,

The salient points I'm taking away from this are:

1. Stay clear of the S3 Group period!!!

2. Ensure the terms of payment are clear in your contract and not hidden in a Master Agreement, between the Agency and Payroll company.

3. Ensure all changes to the contract between the Agency and Payroll company which affect you are in writing and your given at minimum a months notice.

4. Don't accept / walk away from payment terms greater than 15 days, after submission of invoices, which allows Agencies to hide their financial difficulties or expose their greed.

5. Finally ensure you have legal cover in place, you never know what the cunning Accountant or unscrupulous Agency may have up their sleeves.

[r0bly0ns]

Incorrect, the "client" as far as contractor is concerned is the agency.

Suppose you are right there, once you have done your work, you have delivered to your client (agency), it's nowt to do with you if your client's client has paid or not.

I take back my original comment

[Not So Wise]

Carrying out two months work before being paid. If there is any financial difficulties at the Agency, this can be kept hidden for two months perhaps longer?

Take my word for it, in my early days of contracting I learned that it could be kept hidden for 2 months and longer, that was one of the most expensive lessons in my whole life. Since then my rule of has been never more 44 calendar days exposure (monthly invoice, 14 days to pay) with preference for 37 days (monthly invoice with 7 days to pay)

My contracts always state this in the terms, if the agency asks for 30 days on a monthly invoice i do not take the position

Clients direct I give a more leniency (but not much more) but never agencies

personally believe it's time to ensure Contracts are checked by a Contract Lawyers and checked for loop holes and unreasonable terms.

Well to be honest if one has some common sence and comprehensive reading skills they should be able to catch these types of terms even before going to a lawyer. And then it is just a matter of negociating with the agency for more resonable payment terms and and more importantly being willing to walk away if you don't get what you want.

Then again remember some old saying about people who sign contracts without consulting their lawyer and fools

Better still, steer clear of S3 Group and work with smaller Agencies who are willing to pay in 5 days of invoice submission...

One should steer clear of S3 agencys...period

The quicker more contractors stop going to them for contracts and even worse accept the crap they dole out quicker these agencies either change their tunes or go out of business

What is the problem with not getting paid until the end client pays? This is how business works.

Incorrect, the "client" as far as contractor is concerned is the agency.

Agency pays up according to contract terms with the contractor (unless contractor is stupid enough to sign a contract specifing otherwise). If the agencys client pays late/does not pay the agency, agency still owes the contractor regardless (unless, once again, contractor was stupid enough to sign a contract that states otherwise and also opted out of agency regulations)

It's the same as a manufacturer who sells a product to a retailer, retailer has x period of time to pay the manufacturer, when said period is up they have to pay the manufacturer regardless of having sold the product to a "end client" (consumer) (in some cases, new product lines, the manufacturer allows the retailer to return unsold products but this is not possible in our situation)

[malvolio]

If the Agencies are strategically moving to a position in which payment is only made when the End Client pays. This leaves the Contractor especially new ones in a awkward position.

Simple. Opt-in. Your payment cannot then be dependent on the agency's income stream - about the only thing that the Agency Regs are good for, assuming your cashflow is bad enough that it matters.

[Red 7]

Noddy,

It sounds as though your situation is compounded by the fact that your payroll co seem to be unable/unwilling to factor the payments to yourco. i.e. they're waiting for S3 to pay before processing any payments to you. Perhaps they shouldn't even be expected to factor payments; it may not be part of the service they offer.

I'm surprised that even before the recent 'change', your payments were taking 15 days from progressive>payroll>yourco. Formerly, Progressive always paid me within two or three working days. Perhaps your payroll co were hanging onto the funds themselves before passing them to you?

I'm not particularly concerned about the slightly longer delay in payments from Progressive; in general, any agency work I do is paid much more promptly than work for MyCo's other (non-agent) clients. I have one client at the moment who is dawdling over paying an invoice dated 20/5/07.

I take the view that in general, if I can receive payments within a month or so of submitting an invoice; then I'm laughing. Anyone who pays much later than that I deal with on a case by case basis. If I know the client very well and I'm confident that they will pay eventually I usually do the work. Conversely, I occasionally decline work from those who have historically been poor payers - or demand they pay a hefty deposit + stage payments for larger projects or for smaller projects to pay for the whole work in advance - I've managed this a few times when the work is urgent.

[r0bly0ns]

I'm left wandering why are we paying such large commissions to Agencies 15 to 20% I've heard of 25%.

If the Agencies are strategically moving to a position in which payment is only made when the End Client pays. This leaves the Contractor especially new ones in a awkward position.

Eg: Carrying out two months work before being paid.

We do not pay anything to the Agency, the end client does.

The margin the client pays the agency has nothing to do with your rate, that is a payment to the Agency from the client for their services. You agree a rate with the agency, they agree a rate with the client. If you are not happy with your rate then you should not have agreed to it.
The client knows they are paying the agency more than you get, and they know this is to pay for the services of the agency, you are kidding yourself if you think the end client would pay the same amount to you if there was no agency involved.



What is the problem with not getting paid until the end client pays? This is how business works.

[ImNoddy]

Red, this is not just an Progressive issue, my understanding from my Payroll company is the same change as taken place to Huxley and Computer Futures (S3 Group)

Whilst I have been contracting for X number of years and have built up a comfortable position, unlike yourself I didn't receive a email or any notification of payment change.

In previous contracts, I had the luxury of being paid in 5 days after submitting my invoice, this was previously 15 days with Progressive and now 25 days. Whilst a cunning Accountant as found a loop hole which is currently being utilised.

I'm left wandering why are we paying such large commissions to Agencies 15 to 20% I've heard of 25%. Lets face the facts the End client will normally pay in 30 days agencies can easily afford to pay upfront with such large commissions from the contractor, if they are borrowing to fund payment the interest rate is approx 7%. The Payroll Companies only receive a small amount for their work. Surely there motivation can't be driven by cash alone?

If the Agencies are strategically moving to a position in which payment is only made when the End Client pays. This leaves the Contractor especially new ones in a awkward position.

Eg: Carrying out two months work before being paid. If there is any financial difficulties at the Agency, this can be kept hidden for two months perhaps longer? Having finished a contract waiting up to a month maybe longer before payment.

I would not be surprised to find we are on a crest of a wave, I personally believe it's time to ensure Contracts are checked by a Contract Lawyers and checked for loop holes and unreasonable terms.

Better still, steer clear of S3 Group and work with smaller Agencies who are willing to pay in 5 days of invoice submission...

[Red 7]

I have a contract with Progressive. My understanding is that my contract with Progressive has always stated that BACS payments will be made from Progressive to MyCo within 14 days of receipt of a client-authorised invoice.

The change you're referring to, is that until recently, Progressive generally paid within a couple of days of receiving an invoice (from the goodness of their hearts, so to speak) but now they are using the full 14 days to pay. The contract or terms haven't changed, Progressive are just keeping the wedge in their account a bit longer than they were before, but they are still operating well within the existing terms of the contract.

I expect some bright spark realised how much interest/cashflow they were losing out on using the prior payment method. She probably got a hell of a promotion from it too.

What was shoddy though was the way the news was broken. basically an email saying "as from tomorrow the situation you have been used to for the last X months has changed and we won't be paying your co again for a fortnight." I did initially wonder if they were having financial problems... especially when I called and was told that my contact, the public sector contracts manager, had gone 'travelling' for an undisclosed period of time. (Yup, that's right, he left )

In practice, they seem to be paying on average 10 or 11 calendar days after receipt of invoice, so it looks as though they are factoring in the 3 day BACS transfer time into their 'new' 14 day payment regime.

What this really boils down to though is that you should have enough wiggle-room in your cashflow to not be squeezed by these little blips. If being payed 8 or so days later than you were before is causing you problems, you should probably think about keeping more fluidity in the bank acc. IMHO of course.

[sathyaram_s]

In theory, the payroll company should have told you about the changes. But, I'm not surprised they didn't. The agency and the payroll company will be in very friendly terms.

What you can do in this stage is dependent on your terms of agreement you signed with the payroll company. If they are obliged to confirm with you about any changes to the contract, then you have an upper hand. Otherwise, I'm not sure ..

So, what are the changes ? Is it really impacting you ? Or are you just not happy ?



Whatever change it is, make sure you get a copy of it from your payroll provider - especially if it has to do something with payment frequency ... If the payment frequency has changed from week to month, then send your timesheets only on a monthly basis and not on a weekly basis ...

1. My contract is with a Payroll company.
2. The Agency as a contract with the Payroll company.
3. My contract is linked into the Payroll and the Agencies contract.

Which is where the change as taken place, do I not need to be informed offically when the change affects me the most?

[malvolio]

1. My contract is with a Payroll company.
2. The Agency as a contract with the Payroll company.
3. My contract is linked into the Payroll and the Agencies contract.

Which is where the change as taken place, do I not need to be informed offically when the change affects me the most?

Well you didn't mention that minor detail so we kind of assumed a more normal arrangement. However you presumably have a contract of some kind with the payroll company defining when and how you get paid: if they are going to be driven by the agency, exactly what value do they add to the whole process? I suggest you tell them you want your money as before and let them worry about how to do it.

[ImNoddy]

1. My contract is with a Payroll company.
2. The Agency as a contract with the Payroll company.
3. My contract is linked into the Payroll and the Agencies contract.

Which is where the change as taken place, do I not need to be informed offically when the change affects me the most?

[sathyaram_s]

Contracts can be amended on mutual agreement and cannot be forced ...

What are the changes you are talking about ?

As anyone had there contract changed and payment date shifted without any notice?

[malvolio]

No - and nor have you unless you agreed to it in writing. That's why they're called "Contracts"...

[ImNoddy]

As anyone had there contract changed and payment date shifted without any notice?