Reply to: Agency payment terms degrading me from 14 to 28 days

[mailric]

just been asking same question on new post - doh. i'll delete immediately before the abuse starts!

month invoice then another 28 days seems usual, thats some time for first contract and travelling expenses etc.

oh well. credit card is going to get hammered.

[johhnysalad]

I've done a couple of projects through Pathway, completed online timesheet and invoiced Friday, approved by client online Monday, money in bank following Friday.

Sweet.

I'm on 28 days @ Pathway - not sure if this is now the norm?

[oracleslave]

A bit odd ! I hope you follow industry best practice by paying late and making constant admin errors.

I don't. It's a mates gf that owns the agency and she has proved useful in finding me stuff in the past so wouldn't do that.

[rootsnall]

I am sort of doing this but not by choice. Because the agency had difficulty in getting on the clients preferred supplier list, I invoice the cient for the full amount directly and then give the agency their piece of the pie thereafter.

I could have cut agency out altogether but figured it wasn't a bridge worth burning as they did push me in the direction of the end client initially.

A bit odd ! I hope you follow industry best practice by paying late and making constant admin errors.

[oracleslave]

Never heard of that in 10 years of contracting myself and 14 years dealing with contractors. Nor do really see anyone benefiting from such a scenario except maybe the agency as it would be more hassle for the client and probably cause cash flow issues for the contractor (clients are notorious for paying late)

Think it is a case of people confusing permie placements that kind of work like that or ways other non IT contracting sectors might work

I am sort of doing this but not by choice. Because the agency had difficulty in getting on the clients preferred supplier list, I invoice the cient for the full amount directly and then give the agency their piece of the pie thereafter.

I could have cut agency out altogether but figured it wasn't a bridge worth burning as they did push me in the direction of the end client initially.

[Not So Wise]

Could some of the older contractors on here confirm that in the good 'ol days, the end client would pay you directly and you (the contractor) would pay the agency commission from that?

I have heard it more than once.

Never heard of that in 10 years of contracting myself and 14 years dealing with contractors. Nor do really see anyone benefiting from such a scenario except maybe the agency as it would be more hassle for the client and probably cause cash flow issues for the contractor (clients are notorious for paying late)

Think it is a case of people confusing permie placements that kind of work like that or ways other non IT contracting sectors might work

[Churchill]

Could some of the older contractors on here confirm that in the good 'ol days, the end client would pay you directly and you (the contractor) would pay the agency commission from that?

I have heard it more than once.

I was a contractor for twenty years and never experienced this.

[bobhope]

Could some of the older contractors on here confirm that in the good 'ol days, the end client would pay you directly and you (the contractor) would pay the agency commission from that?

I have heard it more than once.

[richy]

Progressive 14 day payment terms

The Progressive info came from someone sat in the same office who just got renewed. The 'other S3' info was just some office contractor gossip so might be bollards.

Mate just got 14 day terms from Progressive, had to haggle a bit with them!

[chef]

yup as expected, invoice weekly, paid 30 days in advance, that 30 days is up on sunday, today being the last banking day before deadline with no money in the account and bank says there isn't anything due to come in..

writing the "errr it's in the contract, when will i receive the money" email right now... ffs.

fully expect them to pay up, other contractors around me say they always do but they always stretch the 30 days to ususally 33/35 sometimes 40 !! 40!!!!

<chef in grumpy "give me my money" mode>

[Bluebird]

Heard can invoice progressive daily, and payment apparently arrives within 28 days. but that's still quite long.. Optimum IT pays in 4 working days.

Anything more than 14 calendar days does feel like a lot of exposure. How much rate increase is it worth to cover longer payment terms? If on say £30 per hour, that's £4,800 due over those 28 days! meanwhile i'll have done another £4,800 of work in the next 4 weeks waiting for that month to clear.

as I said - the contract is between you and the agency - they can't just tell you the terms you MUST agree to them as well.

Don't forget if you walk away - they lose out as well...

If you want something badly it's always worth applying a bit of pressure to see if they back down.

Most of the time these clowns are just doing what their managers are telling them, the agency realise that if they have 500 contractors on their books - thats a lot of interest payments they are either paying out or collecting...

[richy]

Modis - just upped it to 28 days, invoice monthly.

I believe Progressive also just upped it to 28 days unless you argue, not sure on invoicing frequency.

I think all the 'S3' group might be moving to 28 days !?

Heard can invoice progressive daily, and payment apparently arrives within 28 days. but that's still quite long.. Optimum IT pays in 4 working days.

Anything more than 14 calendar days does feel like a lot of exposure. How much rate increase is it worth to cover longer payment terms? If on say £30 per hour, that's £4,800 due over those 28 days! meanwhile i'll have done another £4,800 of work in the next 4 weeks waiting for that month to clear.

[Bluebird]

Payment Terms are part of the contract, and therefore similar to other parts of the contract like Rate, Hours etc are up for discussion / agreement with the agency.

I'd ask for 14 days if thats what you want - there should be no problem in the agency doing this if they really want to.

I guess it depends on how big and faceless the agency is...

[Bright Spark]

only agency I've come across that pays quickly are hays, submit timesheet
for previous week on the monday and get paid on friday, every body else I've worked with does monthly timesheets and you get paid in 30 days after that
if your lucky .

[Not So Wise]

28/30 days is not unusual but is highly not recommended due to the exposed position it puts you in

As it has been demonstrated repeatedly over the years (with the latest case being Veritas) agencies can and do go bust and when they do you can kiss any money you are owed goodbye

Also my view is that the high agency margins throughout the length of a contract are for the provision of a factoring service, if they are not providing that (and 30 days basically means they are not) they are essentially getting money for nothing after the first 2/3 months of a contract

The max I allow any agency is 15 calender days (which on a monthly invoice translates into a max exposure of aprox 30 days work), if they refuse to agree to anything less than that I don't take the contract

My current agency have max of 7 days to pay up defined in the contract, i invoice weekly (at their request, i prefure monthly), but they normally they issue payment within 24 hours of receipt of the invoice, if not the same day