How An Independent Contractor Can Collect on Half-Paid or Late-Paid Bills from Clients?
December 5, 2004 7:53 PM   Subscribe

CollectionsFilter: I am an independent contractor. I work with small, emerging technology companies. Recently, one company paid me late, the other has not paid me in full - how do I collect?

I am getting legal and collections advice, and am evaluating my options. In the future, I'll be more diligent about accepting 'interesting' work only after doing a full credit report and getting references. Independent MetaMembers - how have you solved collections issues in the past? Share your stories and solutions, TIA
posted by anonymous to Law & Government (4 answers total)
I assume you've got a laywer? They'd be a good person to ask, even if it's just on an 'advice' basis because they have deadbeats as well.

If the company who you did work for has money, then send them to collections. If they don't have money, take them to small claims court and get a lein put against their assets or future earnings.
posted by SpecialK at 12:39 AM on December 6, 2004

Phone them. A lot. Your post isn't clear whether you expect them to just receive an invoice, and then stump up on time. I agree that this should be the case, but it generally isn't. I would recommend ringing their accounts payable two weeks before your credit terms end to check progress, then just keep chasing it every week after it comes due. Many companies in the sector you work are pretty bad at paying bills on time, but don't underestimate the general level of incompetence at admin level - invoices do get lost in transit, get forgotten about in a pile of paperwork on the authorising party's desk and so on. Just keep on top of chasing them and you'll close the bulk of them down reasonably quickly.

Another option you could pursue if you really don't have the time or inclination to do this, is to use a factoring agency, who will invoice your business and collect funds due in return for a fee. Personally I'd just chase them myself.
posted by bifter at 4:09 AM on December 6, 2004

In the old days, I'd been known to just go to their place and sit in the lobby until someone handed me a check. I had lots of time on my hands back then.....

These days, if someone goes more than 30 days past due without a valid, trustworthy reason, I just turn 'em over to these guys. Its cheap, and they do get results. I figure life's to short for me to be wasting my time working as an amateur collection agent.
posted by spilon at 7:22 AM on December 6, 2004

The one time I was worried that a client was going to default on an invoice (they were already a month overdue, and something about them just rubbed me the wrong way), I looked into collections agencies (like Dun & Bradstreet, as spilon mentions) and sent the client a nastygram saying that they'd better pay up or I'd refer the bill to one. That got prompt payment.
posted by adamrice at 9:32 AM on December 6, 2004

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