Consultant not getting paid

[ocean view]

In addition to all of the previous advice, I recommend that you resubmit all of the unpaid invoices attached to a letter noting the dates originally submitted and the payment terms. Send this to the new parent company Accounts Payable/General Ledger department.

In my finance experience, during a corporate integration a lot of company financial records can get “mislaid” for lack of a better word. Invoices are still being mailed/emailed to the old AP department, but that team was laid off before good processes were in place to ensure a smooth transition. So invoices go into a black hole for awhile. Don’t wait for them to figure it out, help them by sending new copies. And stop working.

 

[Texas Proud]

If they really need him to complete the project then I would suggest that he contact them and change the terms of the contract...


Bill like a lawyer... ask for a retainer up front and you will work off that amount... when it is getting low ask for more money... if it does not come you do not work... You will never be behind on payment as you will never do work that you do not have money in the bank...


If it were me and I KNEW I was needed, I would suggest to them that I cannot do any more work until I am paid for all back pay...



I am also assuming that he is already 'retired' and this is just a side gig...

 

[nhcycling]

They are not fulfilling their end of the contract agreement by not paying him. If they really need him to finish the project let them know they need to pay in full by end of week all monies due or he will simply stop working.

 

[Lakewood90712]

Sell the debt to an accounts receivable collection firm.

If the company who is slow / not paying is on good financial footing, you might 80-90 cents on the dollar. If non paying company is on shaky footing financially, maybe 50 cents on the dollar.

Then raise the consulting rate on the next contract.

If the company has any reasonable internal financial controls, using a debt collector will step on some toes, and those responsible will wake up.

 

[copyright1997reloaded]

1. This kind of crap happens more often than you would think/hope.
2. Does the Net30 include a penalty for non-payment. Yes, some companies won't sign agreements like this. One alternative is to do it the other way, i.e. offer a DISCOUNT if paid within a certain term.

 

[Lakewood90712]

If the amount is well over the small claims limit, hire an atty who specializes in debt collection. They work for a reasonable cost of most atty's unless it actually goes to court. And be sure to add atty fees to the debt owed.

A " Lawyer Letter " and a few phone calls from same usually does the trick . An atty. acquaintance , semi retired, has done mostly slow / non pay business cases for the last 10 years. Says extremely rare to actually go to court. Says many flaky companies who can pay, just don't , until faced with a pending civil suit.

 

[nwsteve]

As a consultant, I found a lot of the slow pay issues are routed in administrative ineptness.
If you have not done so already, send all your invoices to the administrative asst for the head of the business activity you are doint the work. Your cover note should indicate that unless the invoices are paid and check issued by xx date, you will find it necessary to discontinue your efforts. The results of you ceasing your work will result in XX impact on the xzy project. Politely request the administrative person to immediately to bring this issue to the attention of department head (her/his boss), so this critical effort is not delayed.
I would also cc the head of the project you are working.
Also cc the Controller.

 

[Which Roger]

He’s a very patient man (much more than me) but has lost his drive to work for them. He’s very disappointed. They do need him though. He’s highly specialized and if they want the job completed they do need him. Of course, everyone is expendable but it would be more of a hardship for them to find someone to complete the project. The simple answer is to get their act together and just pay him!!The men he reports to say they’ll “look into it” and never get back to him. When “gently reminded” they say yes, they’ll look into it and again, nothing

"They do need him", and they show how much they need him by not even making an effort to find out why he's not getting paid? Something ain't right here.

 

[MichaelB]

As a consultant, I found a lot of the slow pay issues are routed in administrative ineptness.
If you have not done so already, send all your invoices to the administrative asst for the head of the business activity you are doint the work. Your cover note should indicate that unless the invoices are paid and check issued by xx date, you will find it necessary to discontinue your efforts. The results of you ceasing your work will result in XX impact on the xzy project. Politely request the administrative person to immediately to bring this issue to the attention of department head (her/his boss), so this critical effort is not delayed.
I would also cc the head of the project you are working.
Also cc the Controller.

This is good advice IMO. While bad intent may be the case, it’s probably inept administrative processing. Remember Hanson’s razor: “Never attribute to malice that which is adequately explained by incompetence”.

 

[brokrken]

Just to give a different perspective. My Megacorp has had some huge issues with payables, which all stems from an outsourcing attempt and then the sale of one of our units. We have the money and will certainly pay, but the systems are not working well, at all and everyone is feeling the pain. I can't even begin to explain the complexity of the issues and it is not just as easy telling someone to just pay it. I'm sure your husband isn't the only vendor dealing with this. I am by no way making excuses for the company, just saying, there may more going on than you realize. Your husband needs to get in contact with someone in finance and hound them until it gets resolved.

 

[REWahoo]

As a consultant, I found a lot of the slow pay issues are routed in administrative ineptness.
If you have not done so already, send all your invoices to the administrative asst for the head of the business activity you are doint the work. Your cover note should indicate that unless the invoices are paid and check issued by xx date, you will find it necessary to discontinue your efforts. The results of you ceasing your work will result in XX impact on the xzy project. Politely request the administrative person to immediately to bring this issue to the attention of department head (her/his boss), so this critical effort is not delayed.
I would also cc the head of the project you are working.
Also cc the Controller.

+2

If the check doesn't show up by your xx date, then it will be time to stop work and lawyer up.

 

[Cobra9777]

...In my finance experience, during a corporate integration a lot of company financial records can get “mislaid” for lack of a better word. Invoices are still being mailed/emailed to the old AP department, but that team was laid off before good processes were in place to ensure a smooth transition. So invoices go into a black hole for awhile. Don’t wait for them to figure it out, help them by sending new copies. And stop working.

Just to give a different perspective. My Megacorp has had some huge issues with payables, which all stems from an outsourcing attempt and then the sale of one of our units. We have the money and will certainly pay, but the systems are not working well, at all and everyone is feeling the pain. I can't even begin to explain the complexity of the issues and it is not just as easy telling someone to just pay it. I'm sure your husband isn't the only vendor dealing with this. I am by no way making excuses for the company, just saying, there may more going on than you realize. Your husband needs to get in contact with someone in finance and hound them until it gets resolved.

Since the company was just acquired by a foreign company, I'm reasonably sure the quotes above explain what's going on. At Megacorp, every time we acquired a foreign company, the first thing that went haywire was procurement and payables. Result was that vendors didn't get paid on time until people were trained on new systems, processes, and policies. Most common problem was vendors submitting invoices to the old company name with the old PO number. The system is carefully designed not to pay until everything matches up perfectly.

He needs to find a contact in procurement and/or finance and make some noise. Small vendors like individual contractors are likely low on the priority list. So your goal is to move up the list of issues being worked. I highly doubt it's a case of intentionally not paying.

 

[MarieIG]

Step 1: Track down the department that pays the vendors and get their contact information;

Step 2: Prepare a past-due notice with copies of all previously submitted invoices (copy the head of the team with which are working); DO THIS TOMORROW

Step 3: Advise the (accounts payable) department that as of (next week) you will no longer do any work on the project until all past invoices are made current (copy the head of the team);

Step 4: Confirm receipt that your documentation has been received and processed;

Step 5: Do not do any more work, attend any more phone meetings, etc. until paid. The head of the team can be so advised - in a non-threatening, courteous but firm matter (would he like not to be paid for his job?)

Step 6: After you are paid, confirm procedure for submission and -payment of bills;

You can always lawyer-up later - but most likely this is due to incompetence not a deliberate intent not to pay. Lawyering up will most likely get you paid, but a large chuck will go to the lawyer and that would probably irrevocably end the business relationship. Selling to a collection agency, is at best, pennies on the dollar.

AS A CAVEAT; this is not a substitute for legal advise, rather suggestions for consideration: not having read the PSA, and not knowing if there are any clauses/ conditions precedent which would preclude the viability of the suggested courses of action.

 

[Carol1862]

I wanted to give a follow up. He got paid yesterday! Not sure what the hold up/problem actually was, but last week he told the contact person on his team that he was sending a letter of resignation at end of week (per his PSA requirements). Things started to escalate at that point. He is an integral part of the project and it would set it back considerably if he resigned. Plus, he’s liked and respected by the team. Unfortunately, no one knew exactly who to contact to make this happen. Now, let’s hope this doesn’t happen when his next payment is due!

Thank you for your very helpful suggestions.

 

[gretah]

I would point out to your husband that it is very unprofessional on his part to be treated like dirt. He is allowing this to happen. He is a professional. When he is not paid, he stops work.

Like Eleanor Roosevelt said "No one can make you feel inferior without your consent."


I knew an attorney who owned a small firm. He was known for allowing clients to pay him several months late and sometimes not at all. Who has confidence in an attorney who is a wuss? Who has confidence in a professional who allows his work to be treated as if it has no value?

 

[RunningBum]

I would point out to your husband that it is very unprofessional on his part to be treated like dirt. He is allowing this to happen. He is a professional. When he is not paid, he stops work.

meh, it was a special situation with the new owners taking over. He probably let it go too far, and the mysterious new process probably wasn't all that hard to find once he motivated them to actually try, but I wouldn't be too hard on him. A professional is also flexible, to a point.

 

[Teacher Terry]

Yes in my consulting work I don’t get paid until the counselor does which means I wait 2-3 months. I totally understand and it’s not a problem. I think RB has it right.

 

[SumDay]

I wanted to give a follow up. He got paid yesterday! Not sure what the hold up/problem actually was, but last week he told the contact person on his team that he was sending a letter of resignation at end of week (per his PSA requirements). Things started to escalate at that point. He is an integral part of the project and it would set it back considerably if he resigned. Plus, he’s liked and respected by the team. Unfortunately, no one knew exactly who to contact to make this happen. Now, let’s hope this doesn’t happen when his next payment is due!

Thank you for your very helpful suggestions.

DH had consulting gigs like this for the past 10 years, and it seems there was a huge turnover in their accounting & HR departments. He wouldn't get paid for weeks, would raise holy h*ll and then he'd get a big fat huge check. My beef was I had to beg for 1099's at tax time and no one ever knew who to send me to for help. VERY frustrating.

Glad your DH finally got his $$$!

 

[ecowtent]

I would point out to your husband that it is very unprofessional on his part to be treated like dirt. He is allowing this to happen. He is a professional. When he is not paid, he stops work.

Like Eleanor Roosevelt said "No one can make you feel inferior without your consent."


I knew an attorney who owned a small firm. He was known for allowing clients to pay him several months late and sometimes not at all. Who has confidence in an attorney who is a wuss? Who has confidence in a professional who allows his work to be treated as if it has no value?

Gretah-I truly don't understand why you would post this comment. It isn't helpful in any way. Think to yourself-Would you make this comment if you sat across from Carol in conversation?



I don't post often so that should say how much this comment took me aback.Wow-just wow.

 

[Sunset]

I wanted to give a follow up. He got paid yesterday! Not sure what the hold up/problem actually was, but last week he told the contact person on his team that he was sending a letter of resignation at end of week (per his PSA requirements). Things started to escalate at that point. He is an integral part of the project and it would set it back considerably if he resigned. Plus, he’s liked and respected by the team. Unfortunately, no one knew exactly who to contact to make this happen. Now, let’s hope this doesn’t happen when his next payment is due!

Thank you for your very helpful suggestions.

Thank-You for the follow-up to let us know this good news !
Here is hoping that now someone knows who to send the payment to, that it continues smoothly.

 

[ivinsfan]

I would point out to your husband that it is very unprofessional on his part to be treated like dirt. He is allowing this to happen. He is a professional. When he is not paid, he stops work.

Like Eleanor Roosevelt said "No one can make you feel inferior without your consent."


I knew an attorney who owned a small firm. He was known for allowing clients to pay him several months late and sometimes not at all. Who has confidence in an attorney who is a wuss? Who has confidence in a professional who allows his work to be treated as if it has no value?

Did you read this whole thread or just the first post and then decide to post this zinger?

 

[target2019]

With regard to non-payment, it is essential to include something in your contract that addresses the situation. One thing that may help in the future is to add a discount for prompt payment. Most bean counters love a bargain.

If the situation is simply invoice being neglected due to poor management practices, you just have to increase your profile so folks know your contribution.

I do remember when years of prompt payment problems arose when the tall good-lucking manager rode into town, and he neatly piled all paper in one pile on his desk. Somewhere in that stack were my invoices!

 

[Sunset]

With regard to non-payment, it is essential to include something in your contract that addresses the situation. One thing that may help in the future is to add a discount for prompt payment. Most bean counters love a bargain.
...

I would prefer a late fee charge, because offering a discount basically means reducing your wage.
People will say to counter reducing your wage, just charge x% more, but that could mean you miss out on some contracts as you charge too much.

Better to keep the expected fee real, and charge for late payments.
The nice thing about a late fee, is it could get expensive, like credit cards do, 3% extra charge every 30 days on outstanding balance.

 

[target2019]

I would prefer a late fee charge, because offering a discount basically means reducing your wage.
People will say to counter reducing your wage, just charge x% more, but that could mean you miss out on some contracts as you charge too much.

Better to keep the expected fee real, and charge for late payments.
The nice thing about a late fee, is it could get expensive, like credit cards do, 3% extra charge every 30 days on outstanding balance.

I've had success with the discount. I also keep my hourly fee higher in order to keep bargain shoppers at a distance. With a higher fee I can also easily offer a discount, or negotiate a lower fee. If you start low, it usually means things go lower, in my experience. Whatever works is appropriate for the consultant.

 

[Z3Dreamer]

A look from the corporate side. I do not know the facts in OP's case. 2 main causes of complaints in my world. 1 ) Manager does not turn in the invoice so there is nothing to pay. Then saves face by turning it in a few days after it is due. 2) Contractor has "net30" on their invoices or no terms. No terms defaults to 30. Then they threaten stoppage unless they leave with a check.

It is amazing how many people put "net 30" but really expect "net 3".

And this idea of no one knowing how to get anything paid. It is a managers job to manage. Part of that is getting your people paid. Corporate made it as easy as possible and we educated new managers. In a merger did the new team forget to communicate new process? It is possible but..

Thank you for allowing me to vent for years of managers and vendors blaming me for their lack of attention.