Ex boss refusing to pay - freelance contact

[BigYellowBird]

Three months ago I started a part time admin job for an entrepreneur. At the time I was offered to go on the pay roll or have a contract as a contractor/freelancer. I was persuaded to go onto a contract as “it’s easier” (yes, I know!) but didn’t spot any red flags immediately. I soon did though. A mess of many businesses, some with HMRC debt, bailiffs letters and a court action from a former partner. Admin that had been left unchecked for months (previous person I later found out was fired and a few before her). And I was effectively being asked to do two full time jobs well above my experience and grade in part time hours. Made worse by not having full training in the many bits of software I was asked to manage (so couldn’t fully) and a boss who frequently was either completely unavailable or would insist on asking to me stop what I’m doing in order to do something else, like register a new company name or find free/cheap legal advice as he wouldn’t actually hire a solicitor.

So I resigned because I felt I hadn’t had the training from the business I needed to fulfil the job. I was also being asked to do the work of two full time positions in part time hours. Essentially being set up to fail. I said this in my resignation email. It was all a mess and I also felt very uncomfortable with the way the business was (not being) run. The long version is very long and I’m not sure if it’s relevant but will add it if you ask.

Ex-boss is now refusing to pay me because I haven’t fulfilled my contract. His first reply was very accusatory, ignoring all the points I made and laying out everything in the contract I had failed to do regardless of my reasons why I couldn’t or didn’t as well as some character slurs. He offered me 40% of what I’m owed. I simply refuted his claims rather than get drawn into tit for tat and re-sent my invoices. His second reply doubled down on his first email, offering 50% of what he owes, saying this was his final offer before he files a claim against me and expects a reply by today. It feels like intimidation and bullying but maybe I'm just sensitive. I think it’s unlikely he would even seek proper legal advice (see first para). I haven’t replied yet. I would be willing to drop what he owes by 25% just to get this done but I don't mind fighting it - although only if I actually stand a chance of getting my money back.

I have noticed he is advertising my job as two part time positions now, so he has somewhat taken on board what I have said despite denying it. I have screen shots.

It feels like coming out of an abusive relationship and I don’t say that lightly as it’s something I have experienced.
Despite my reasons and there are many, many valid ones I haven't written here, what matters is where I stand legally.

Is this worth getting a solicitor for or having a half hour with someone or just going straight to small claims? Or accept/negotiate on his offer?

I have been in a phone queue to CAB for more than 2 hours. They only have 2 drop-in afternoon sessions a week and there are probably plenty of people who are more in need of their advice. I’m not even sure if this is something they can really advise on.

Help please?

I would send a letter before claim detailing all your evidence (there are templates available online) and go to small claims.

I don't know but well done for realising what a shit show it is and noping out of there. Some people would have hung on a lot longer!

I'm no expert but tbh I would go to small claims. Seems pretty straight forward. A solicitors letter has no legal weight and it costs you money. To enforce would need court action anyway as this dope isn't going to put his hand in his pocket voluntarily, so I'd just cut out the middle man.

I am writing pursuant to The Practice Directions on Pre-action Conduct and Protocols.

Despite a reminder sent to yourself my invoices xxxxxx dated xxxxx remain unpaid. From you I am claiming the full invoice amount for xxxxx including VAT. In addition there is also a claim for interest under the Late Payment of Commercial Debts (interest) Act 1988 at the statutory rate of 8.5% per annum. Interest will be claimed from the date payment fell due to the date of this letter. There will be continuing interest from the date of this letter to the date of payment. There will be a further claim for compensation pursuant to the Late Payments of Commercial Debts Regulations 2002 to the sum of £40.

Listed below are the documents in which I intend to rely on our claim to you:

(List documents that demonstrate the proof the money is owed)

I confirm that there has been a failure of compliance on behalf of your company in that you have failed to pay my invoice within a reasonable timeframe of the monies due.

I confirm that I would consider another form of Alternative Dispute Resolution such as mediation in order to avoid the need for this matter to be resolved by the courts.

Failure to make full payment of monies due will lead me to take further action for it's collection which may incur additional cost.

In closing, I would draw your attention to section 4.1 of the Practice Direction which gives the courts the power to impose sanctions on the parties if they fail to comply with the direction including failing to respond to this letter before claim. I look forward to hearing from you within the next 14 days. Should I not receive a response to my letter within this time frame, then I anticipate that court action will be commenced with no further reference to you.

Letter before action and small claims but, given what you said about HMRC, Bailiffs etc I'd not be surprised to find that, when you win, you're left without.

A man of straw cannot pay but there are plenty of others who are adept at running rings around the system.

There's always a game/candle issue with claims for money owed where the putative defendant is as slippery as an eel.

What sort of a sum are we talking about?

What were your payment terms/contract?

How much money is involved?

You first need to send your invoice as per the contract/agreed terms. So if you were suppose to invoice after 28 days and then be paid 14 days afterwards, then you need to wait those 14 days. Make sure your invoice is made out to the right party So if he's acting as an company the invoice needs to be made to that company.

After the required waiting period regardless if he argues to get out of paying, you follow up with an invoice stating payment is overdue threatening legal action or a collections service giving him a further 14 to 21 days to pay. (Depends on your initial payment terms.) Make sure the invoice itself has red writing on it saying overdue.

Then you start legal action or use a collections service. You are better of using a collections service rather than going to small claims. It is quicker. Collections services will investigate whether it is worth going after him in the first place and won't bother if the company/him have no asserts. (The collections service will take about 10%)

I've had to chase up poor payers years ago now myself, plus more recently had to do deal with some trying it on with the third parties I've worked with/through.

A common trick is for them to claim that you haven't invoiced them by the method agreed e.g. you did it via email rather than post and email in the contract/payment terms. However legally it is not an excuse for them not to pay you. (One company went into administration not paying anyone.)

Other tricks as you have alluded to is to claim you haven't done the work agreed up to the date you left. However I've always kept evidence of going to the office itself when required, and doing the work asked. (All ended up having to pay.)

Thank you so much everyone for your replies, this is so helpful. And it makes me feel a lot better too because the whole thing has been really worrying.
I'm owed around £1600 split between two invoices. The first one for most of the amount will be overdue by 30 days on Friday which I think is when I can start a claim but I will continue with the invoices for now and use your message Comefromaway, thank you.
I know his current companies pull in quite a significant amount so worth pursuing.

Funnily enough he hired a business mentor who I spoke to and realised that all the issues with the business had always been issues and will continue to be issues... He actually said "this is a total shit show". Which is when I decided to leave!