MY BAD PAYERS’ PROCESS FOR 2024 & BEYOND
Last week I shared how I was going to get tougher in the future with bad payers or late payers around me and my business.
I shared how I’d attracted various opinions around this since making that announcement and sharing some of my experiences during 2023. Overwhelmingly people were supportive.
One theme which came up a lot was ‘naming and shaming’ there was a 50/50 split between those who thought I should name the ‘bad’ and those who thought I should not. Real arguments broke out around this which was very interesting.
However I know the law especially around libel and I have made a decision that I won’t name anyone who is a bad payer until I have a legal document proving it. For the first time, however, I’m putting that ‘promise’ into my contract and I totally accept that some people may not like that – and may decide not to work with me as a result.
However none of this should bother an ethical company which pays its bills and is willing to talk and negotiate if it hits a bad patch and has cash flow issues. Talking and communicating has to be key to success.
My new process will come into play with to deal with these types of clients – though if I can spot them early enough I won’t work them anyway!:
*Those who think they can just give notice and they’ve not bothered to read the termination clause as set out clearly in my contract.
*Those who have never raised an issue at all and then, when you ask for final payment, suddenly come up with loads of reasons they don’t want to pay you – and it’s all about me and my team. We’re not fooled folks, we know it’s really all about you.
*Those who ghost you and think by ignoring you, you will just go away and nothing will happen. I will go away myself – my credit control team will not.
*Any client who engages in insulting behaviour – in words, deeds or both – with me or any member of my freelance team. If this happens, notice will be given and the termination fee will come into play. This is rare but it does happen.
Here will be my process with the above type of clients.
*I will set out the final fee due in writing and will expect payment within seven days or agreement to a payment plan. Happy to do either.
*Non-payment will then mean I step away and my credit control partner takes over.
*Non-payment then will lead to my credit controller partner sending a Letter Before Action detailing what the additional fees will now be – these will include all outstanding invoices; termination fee if relevant; credit control fees; court fees; my additional time fee; interest as set out by the Small Business Commissioner for all outstanding invoices. There will be 14 days to settle.
*With my credit controller we will start the Small Claims Process with the courts including all additional fees as set out in the Letter Before Action. The company/person concerned will have 21 days to mount a defence or to settle. I will instruct the court to keep adding on interest.
*After 21 days, we will apply for a County Court Judgment or prepare for a court hearing whichever is relevant.
*When and if a CCJ has been issued, I will then make its contents public to act as a warning to others not to work with this person/company. I will state the matters as fact supported by a legal document to prove what I’m saying is the truth as ratified by a court. Technically CCJs are in the public domain anyway – you have to pay an admin fee to see them.
*If payment is not then made I will appoint the Sheriffs to visit the relevant premises and seize goods to cover the outstanding debt and their own fees. I will also make this process public. I will, if the debt is settled, also update and make a public statement about that.
*When I have that CCJ, I will then send it to every journalist, influencer or contact I have contacted about that person/company during our time of working together and let them have a copy for their information. I will also update them on how it’s going and if the person/company has paid – or not. What they do with that information will be up to them.
If we don’t call out this behaviour in the world of small business, there’s a group of individuals and brands who will keep on destroying small business owners across the UK. Often these are other small business owners – not just large corporations.
*And those who say to me what if someone takes you to court? I’ve had this once in 16 years and I said that I would happily go to court to defend myself. They settled with me and issued me a full apology for their behaviour weeks before the court hearing. At that point I told them the matter was closed and I did not refer to it again.
