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Getting your fee out of the client in the present economic climate can be sometimes tricky. You have done your job, they have the candidate in place ( invoice on day one of work!) yet  7 or 14 or 28 days later ( what are your payment terms?) the proverbial cheque is still in the post. What’s the best excuse for late or non payment you have had in the last 12 months?

This can be a thorny one too and ever increasing in these tough times – you have to ask yourself if it’s a ‘can’t pay’ or ‘won’t pay’ situation. For some it will be cash flow – they are waiting on customers paying them before they have funds to pay you. You will not be at the top of that tree because you have already supplied the ‘goods’ and are unlikely to ‘withhold further shipment’. Keeping pressure on with tight time scales and good credit control systems is essential. Have a deadline to work to and stick to it.

If it is a genuine debt – no issues having been raised in terms of the quality of the service provided or the candidate – then you might want to consider a fixed fee debt collection service that will do the telephone and letter chasing for you for a fixed small fee – usually a percentage of what is recovered. At Nelsons we offer Debtco – a fixed fee service for collection and enforcement of undisputed debts in the UK and abroad. If you decide to use this sort of service, check what is being undertaken for the fixed fee and what is included or excluded – such as court fees or  process servers fees which are often payable in addition and sometimes in advance.

Beware the manufactured dispute. In recent times the ‘savvy’ Defendant to a claim for unpaid invoices has worked out that by filing some sort of defence – no matter how spurious – the debtor can buy time – and sometimes lots of it – to pay you. Such  delays do incur costs that they can ordered to pay in addition, but that makes the creditor do the running and incur the expense to start with. There are procedures that can weed this sort of claim out, but my experience has shown that such delays constructed by debtors can sometimes prove to be a bridge too far for the creditor, and debtors can get away with it if you haven’t the stomach or the deep pockets to pursue them.

Again take pragmatic commercial advice about your options – there is rarely only one way to crack a nut and a good adviser should be able to tell you what you can do, quickly efficiently and cost effectively – and almost as important, what you should not do and cannot achieve within your timescale or your budget.
 

For more information on this subject, please contact dispute resolution specialist Heather Stanford or join the debate on in our eForum on Linkedin