bloody client - payment now a month overdue - and there's history

[hatwoman]

this feels a bit like spidermama's complaint re rates and the BBC - because it goes deeper than then actual facts and figures so to speak.

I left a huge organisation about 6 months ago to work as a freelance consultant. part of my reason for leaving was that they utterly take for granted good people of which I'm one (might sound conceited but it's true. my boss was the one choking back tears when I told her and at my leaving do - because she knew how let down I'd been).

so, despite the fact that they pay consultants something like half what they can get elsewhere, I 've done some work for them since leaving. partly because there are aspects of this organisation I have huge respect for. I see it as semi-pro bono.

my FIRST piece of work for them...my first invoice - with (imo) generous payemnt terms of 30 days - nothing. so after about 35 days I send a very friendly email to the contact person, who I know well, she says she'll chase it up...blames another dept (she's almost certainly right in this - but now I'm external it's not particularly my concern). nothing. so, at about 45 days - another friendly email....on monday it will be 60 days and it's still not in my bank account. I know Christmas hasn't helped but, tbh, I'm furious. I suppose I should be "grateful" for the work (another big-name organisation that thinks it can call the shots) but this is so disrespectful.

so....I have another project with them...they are desperate for me to do a further 5 days on it and I know it will utterly leave them i teh shit if I back out....do I do it? do I escalate by emailing my former boss (also the boss of both the project I;ve done and the one they want me to do)?

sorry this is really long for what is part and parcel of being a freelancer but I'm so pissed off. they can;t even get a bloody accounts clerk to sign a bloody transfer of a measly 1000 quid on time.

I think the time for friendly emails has passed. Formal letter is required, and I don't think you should do that piece of work until you have been paid.

Threaten to back out unless and until you are paid for the original work and have a clear payment schedule for future work.

If you do anymore work for them make sure they know that you will be charging interest after 30 days, and write it into your terms and conditions. Do you need their business or would you have enough work without them? If you can do without the then I would email your former boss saying that you will be unable to do the extra 5 days that they need until you have been paid what you are owed.

do you mean I shouldn;t use the rather lovely line I've just thought of to my former boss - forward her all the correspondence with "at least I used to get paid for being taken for granted"

It's crap isn't it? I did some work for a new client in September, submitted my invoice at the start of Oct and got paid about 2 days before Xmas. They still haven't paid the other two invoices I have since submitted. And it's also a big company. It's very disrespectful, I agree. Seems to be down to the payments people, rather than the people I am actually doing the work for, bu not sure how one can chivvy them along.

do any of you charge interest on late payment? and if so how much do you charge? the amount of interest I would have got if it had been in my current account on time is nothing. (well 10p to be precise!)

info here on what you need to put on your invoices and the rate of interest you can charge

Argh, they're all bastards. By my standards 60 days is positively prompt, though.

I'm owed in excess of £2K by a national newspaper for some work I did in July at very short notice, blahdiblah. I was very careful to get instructions in writing before doing anything at all, but they're still not damn well paying. Am about to take them to Court, I've done all the 'if I do not receive payment in full within 14 days of the date of this letter' bollocks, so time to bring in the heavy guns. And I had a client who owes me an even larger amount of money from last October, yes, October 2007 who has now gone bankrupt. So I'll probably see only a very tiny fraction of it, if that.

I don't charge interest, because it's just too complicated. Most late payments are because invoices get lost in the system, though a proportion are clearly taking the piss. Hate em all.

I informed a regular client that I'd have to cut payment terms from 30 days to 10 days because they were always paying so late - they blamed me for not being able to accept credit cards! Apparently they'd have paid at the time of ordering if I took cards... I also started copying the financial director of the company into all my emails to the admin staff.... ever since the money has cleared into my account dead on 9 days after invoice

i used to work for a big organisation and invoicing systems are always a nightmare.

as you used to work there, do you know how their system works? did you need a PO number? are they using SAP or one of those bloody awful systems?

i would put the pressure on the person who initiated the work - they are probably the only one who can get it pushed through, ensure all is authorised and there is no missing detail/number which means it is being held up.

adding interest payments etc won't help imo...

i wouldn't do the next piece of work until you are paid for the current, that's the only ammunition you have.

oh and i would definitely reduce your payment terms from now on.
50% on commissioning
50% on completion

I usually call and speak directly to accounts. it usually works. or in your case, call the boss. A call is much more effective than an email or a letter.

hatwoman - you're making a very common mistake here, which is to make it personal. Unless there is someone at your old firm who is intentionally not paying you, then you're not dealing with people, you're dealing with a system. As it's a huge corporation they will have an accounts system that, once it has been started, can't be stopped. The key is to make sure that your invoice gets into this system.

You have an advantage here, though, in that as you worked for the organisation, you should know how the system works.

The person who you invoiced will be responsible for signing off your invoice and then passing on to the accounts department for payment.

TBH, your 30 days are unlikely to be taken much notice of as the company will have their own time frames that they operate within. Many organisations pay at the end of the month after the month in which your invoice was received - so you could have to wait up to 60 days in some instances.

The critical things to do are:

1. make sure that the invoice has been signed off/aproved
2. make sure that the accounts department has received it, and that is has been entered on to the system. Unless this has happened you will not be getting paid!

Also be aware that they will have to set you up as a new supplier on the system, and this in itself can take time, which would also delay your payment.

The best thing that you can do is to make a friend of the person in accounts payable, to find out the status of your invoice. When you have this information you will be in a much better position to decide what to do next.

As well as finding out the status of your invoice, make sure that you also find out (if you don't already know) how their system works - i.e. once they have received an invoice how long does it take to process through to payment. Then you will know how best to invoice your next job.

Don't turn down the chance of more work - the person commissioning you almost certainly will have nothing to do with the 'late' payment (unless they have forgotten to pass your invoice on/deliberately not passed your invoice on). You will undermine your chances of further work if you do this. Unless this person can specifically influence payment of your invoices once in the system (which is very unlikely), you need to leave the issue of payment alone and deal only with the issue of more work.

And when you do the next piece of work, the best advice I can give you is to make sure that you phone the accounts department about a week after you have submitted your invoice to establish whether or not it is in the system. If not, then you can contact whoever is responsible for signing it off and ask them to make sure it's been passed on.

Sorry this is so long, but it is based on 10 years' worth of dealing with different companies and their assorted payment systems!

And good luck with future work/payments.

When I worked as a freelance, I found that repeatedly sending formal statements often worked. Some larger companies have a system where the invoice only gets paid on receipt of a statement. Bloody annoying though...

This is the single biggest issue which makes me lose sleep at night, and luckily have only had one incident in 7 years but already clients are delaying payment now as a result of economy so will only get worse. 30 days now regularly 45 with some of them, but these are clients I have had for years so I know their VAT cycle and when the delays likely to happen!

I would refuse to do the further work unless payment received too. It's the biggest stick you have at the moment. At the same time you need to get a written undertaking about future payment of invoices just so everyone clear on what's expected.

...and the stuff claus said. always invoice at the end of the month, not the beginning if you can.

it is difficult this Hatwoman. I too work for the Editorials (and the bbc ) and am always gobsmacked if I'm paid on 30 days. 60-90 has become so common now.
The difficulty is in this current climate if you make too much of a fuss you risk losing them as a client altogether.
If I have no joy with accounts I always email the project manager/boss saying...any chance you can chase this for me bla bla. It usually works.

I would think very carefully about threatening not to do the next job, as it isn't those people you're threatening it's the system - and those you're threatening are also likely to have limited influence over the system.

It also jeopardises your chances of future work. To be brutally honest, no matter how good you are there's probably someone else who could do the job instead of you.

The best approach if you're going to take this tack is to accept the commission, undertake the work but then delay delivery of the report/presentation/results (whatever it is that you do!) until payment has been made.

interesting thoughts...thanks all. I've got to go out now but will post some responses later.

my initial thought is that I realise I'm dealing with a system - but it's a system that has been put in place by and is run by people (albeit not the project managers I'm dealing with). and in this case, imo, the system has been willfully neglected - as have many other things to do with managing people. time and time again these things have been put right at the bottom of the pile. it's symptomatic of a deep malaise within the organisation and that is why I feel so sad. the organisation is its people and yet they are very neglected and it makes me very sad. tb perfectly honest I'm not even that bothered about the money but it's one of the many things that makes me want to shake certain people by the scruffs of their necks.

If you perform regular work for one client, get into the habit of sending a monthly statement, showing what has been paid and what is still outstanding. I've done it with all my clients and it usually does the trick.

Don't forget to state your payment terms on all your invoices. Also, add the amount of interest that you will be charging once the payment period has expired without payment.

You're a business not a charity. I lost just over £9K through being too trusting with a client when I first became self-employed. I've now found that being more business-like with clients - but not bolshy - gains you respect.