13

I've been working as a freelancer for almost 2 months, full time, for the same company. No prior freelance experience. As per the contract, they have 30-45 days to deposit the money in my account.

I sent an email with the invoice, 3 weeks ago. Got no response. I find it extremely unprofessional, and really don't want to work any further with a company that, having its own payment department, fails to answer something like "received". Also, I'm not talking about a small company.

I got plans of writing an email in 3 days (Monday) stating that, unless I get a response, I won't work more than that week.

My question is:

  • How are this situations handled? Would it be better to just wait for the last day of payment that the contract says, and then take legal actions?
  • How can I write this email, considering that, if I receive an answer through the next week, I am interested in continuing working for the company?
  • If I do get paid and continue with the company, but this happens again, how could I handle it?

Further details:

I'm not complaining about not getting paid. I find that not giving any kind of answer to an invoice mail is rather unprofessional. Adding to my discomfort, they had previously behave unprofessionally, failing to tell me how/when to do the previous steps (sending and confirming the hours I did); and how/when to send the invoice; for everything regarding hours/payment, I have always had to send them emails insisting/asking to know how the process works. Also consider that if they fail to answer the invoice, I never know if they could have a problem with the bank/invoice details in the last minute, thus breaching the contract (if they informed me in say, the 44th day).

Also:

  • for what I've been told, the client is really happy with my work
  • I talked to the person in charge of the project about this, who supposedly sent a message to the person in charge of the payment, but I don't know anything else about it.
  • I obviously have to invoice the work I've been doing this past weeks, next week (for a total of 4 weeks).

Follow up:

This behaviour has been the same for all the 4 months working with them; I send the invoices, the accounting team doesn't answer that or the other 2 emails asking for a response; 3 weeks passes, I tell that to my contact in the company, and after 10 days I get the payment. So this is indeed a company with a serious problem making their payments and having a respectful communication with their contractors.

Thanks everyone for the input.

  • 44
    They have 45 days to deposit the money in your account. You have so far provided them only 21 days. I... don't see why you are concerned at this point. I don't see why you are considering threatening to terminate the contract, despite no material breach having occurred. Could you elaborate? Maybe I'm not understanding. – ChrisInEdmonton Apr 8 '16 at 14:36
  • 59
    When you get your cell phone bill do you call up the company and let them know you got it or do you just pay by the time it's due? Why should they treat your invoice any differently than that? – Doyle Lewis Apr 8 '16 at 15:19
  • 2
    Also, if you are freelancing lots, we now have a Freelancing.SE site available in Public Beta. – Canadian Luke Apr 8 '16 at 17:06
  • 4
    It's very common for companies to not respond to invoice emails. It's rarely an indication that they aren't going to pay you. – Lindsey D Apr 8 '16 at 17:39
  • 5
    You're actually the one acting less than "professional" by inquiring before your "late" date has passed for the invoice. Makes you look a little over-eager and impatient. Nobody acknowledges receipt of an invoice... they just send a check or whatever sometime after they receive it. And, many companies will actually send payment after your "due date"... it's just how companies operate and isn't "unprofessional" really, and you should get used to this if you're going to be doing this for your income. – SnakeDoc Apr 8 '16 at 18:46
62

As per the terms of your contract, the company has 45 days to respond to your email, by paying your invoice. You have so far provided them only 21 days. It is rather unprofessional of you to hold them to a different standard than the contract specifies.

Yes, they might fail to pay you within 45 days. They might announce that on day 44, or they might not announce it at all, just fail to pay you. Hopefully that doesn't happen, but that's why you have a contract.

If you wanted different terms (for example, the company must acknowledge the invoice), you should have put this in the contract. It would be an incredibly strange clause to include, but you can more or less put anything you want in a contract, so long as the other side agrees.

Short of that, you could, in the future, try read receipts or try sending the invoice with a sentence such as "Please acknowledge receipt of this invoice" in the email body. But the company may choose to ignore your request and it would be inappropriate for you to demand this, assuming it isn't in your contract.

  • It is typical for companies to pay when an invoice is due not before. The OP is thinking of it as a payby date while they see it as a don't pay until date. If you want to be paid more promptly reduce the time to 30 days or even mark as 'now due' but hold them to the 45 days that you have agreed. He certainly shouldn't be getting uppity after only 21 days. – JamesRyan Apr 8 '16 at 16:50
  • @JamesRyan lol "uppity". As I stated, I'm not complaining about not being paid. – RominaV Apr 8 '16 at 17:45
  • @user2819864 as other people have stated, you shouldn't expect them to acknowledge a bill except by paying it within or after the time stated unless you have expressly asked them to, that time isn't even near and you are talking about breaches of contract and ultimatums of refusing to work. If you send emails like that at the drop of a hat instead of having a reasonable casual conversation with the relevant person, companies simply won't hire you anymore. You are calling them unprofessional when the situation is born from your inexperience and kneejerk reaction. Chill out and talk more. – JamesRyan Apr 8 '16 at 20:58
  • If you are using MS outlook, you can always check the Request a Delivery Receipt and Request a Read Receipt checkboxes. The user has the option of not accepting these, but usually they'll just click OK. – Michael J. Apr 8 '16 at 21:32
  • 3
    I agree with most of this answer, but I'd add one more point. Sometimes, it's ok to re-negotiate a contract. Of course, the client can always say "no" to a renegotiation. But if your cash flow is such that you can not wait 30 to 45 days to get paid, it may be worth swallowing your pride and asking for a revision to your terms before you get started on the next set of deliverables. – Stephan Branczyk Apr 9 '16 at 3:33
21

So you sent a single email three weeks ago and are now basically going to write the company off?

People get busy. Things slip. What you should have done if you were particularly concerned:

  1. Send email
  2. Followup in a few days with a phone call to confirm
  3. Get a firm date the company will process payment by
    • If this doesn't happen for some reason talk with your business contact and ask about this
  4. Followup again if that does not happen

You should never send emails when you desire a response in a certain timeframe. Especially if you are planning on quitting if you don't!

If you must document something, send your initial email and then followup with a phone call (especially if you do not receive confirmation electronically). Keep in mind not receiving confirmation responses from invoices is fairly standard.

  • 5
    I think even steps 2 and 3 are a bit over the top. In all my years of running a business - both sending and receiving invoices, it's extremely rare to follow up an invoice with a phone call and demand a firm date for payment, when the payment terms are already specified on the invoice / contract. The normal procedure is - (1) submit invoice, (2) chase after deadline is missed. This isn't just a matter of convention - it's an unjustified waste of money for businesses to spend time confirming / chasing / being chased on invoices which aren't due yet. – Jon Bentley Apr 8 '16 at 21:10
  • 1
    @JonBentley I agree, but the OP is seemingly very interested in confirming/etc. In a general sense what you are saying is true, but considering their interest in confirming and making sure they are getting paid 2/3 seem reasonable. I'll edit to clarify what you are saying. – enderland Apr 8 '16 at 21:15
  • 2
    This is why invoicing is stressful to those new to it. You have no idea whether an email has arrived and been processed. So either confirm it, or else accept that if anything goes wrong you definitely will not be paid on time, and commonly a month late if they never see the invoice until you chase after it's already due. A freelancer with only one current client has more interest in a particular invoice (their only income) being paid on time, than a larger business with many invoices in flight, most of which will be paid. – Steve Jessop Apr 9 '16 at 11:52
  • @SteveJessop , exactly my position. Thanks for understanding. – RominaV Apr 9 '16 at 22:26
  • 2
    @user2819864 In the UK where I'm from, terminating your business relationship and hiring a lawyer the first day a payment is overdue would be seen as very strange and aggressive. In fact judges in the courts here will heavily frown on legal action that is taken with no effort to resolve it prior. The normal route would be to chase it politely, send a polite reminder, send a final reminder with a threat of legal action, and then pursue legal remedies. Usually you would wait at least 30 days before doing that, with 14 days being the recommended minimum. – Jon Bentley Apr 9 '16 at 23:06
7

"How can I write this email". Don't email! Call your contact there. Tell them you will be sending another invoice in the next week and that you want to make sure there were no issues with the first invoice you sent. Be polite, they haven't done anything wrong. They are still within their window of payment, etc.

It seems like you really just want confirmation that they got the invoice and are processing it. In the future, when you send an invoice, just call later that day or the next to make sure they got it. If you are lucky, they will catch on and start sending an immediate email response to future invoices saying they got it.

  • I like this answer the most, because it addresses the direct concern: that they actually received the invoice. Since it's very possible for it to have been caught in a spam filter, that's a reasonable concern for the first few emailed invoices. Much better to use a quick phone call to confirm receipt, then for them to not pay on time because they never saw the bill... – Bobson Apr 10 '16 at 2:36
3

EDIT: It seems you've only waited 21 of 30-45 days. So there is no outstanding payment. Not all clients acknowledge receiving an invoice. If you require such an acknowledgment, you should explicitly ask for it.


Your handling of the situation is basically correct.

The fact that the client department appreciates your work should be used/exploited further by you.

Tell them that you unfortunately are not getting through to the payments department, which is a shame as you enjoy working for them, but obviously need to be paid.

It is always preferable when you can have the client handle company-internal problems such as this; it's much more difficult to be alone against an opaque and silent corporate entity.

Monday I would tell the department you work for that you need payment by the end of the week - or you won't show up next Monday. Remember to add that you would much prefer just to get paid and continue working - but need to draw the line now. Anyone reasonable would understand - and if they really do appreciate the work, they will even fight your battle.

  • 5
    The invoice isn't even due yet. Turning around and saying "I need you to pay this invoice early or I'm not working for you any more." is probably not a good way to continue to receive business from that company. I don't think anybody reasonable is going to understand. If they were overdue, sure, but that's not the case. – Anthony Grist Apr 9 '16 at 13:39
  • @AnthonyGrist I didn't want them to pay earlier!!!! please read the question again. I just wanted to know they received the invoice and that it was correct, and hopefuly an estimated payment date. – RominaV Apr 9 '16 at 22:30
  • @user2819864 Read this answer again. I was commenting on it, not your question, and it very much mentions being paid by the end of the week (i.e. early). – Anthony Grist Apr 9 '16 at 22:45
3

ChrisInEdmonton gave a very appropriate answer in regards to the company being within bounds of your stated contract. If the terms originally agreed upon do not fit your current business model then you should renegotiate when you have opportunity.


That said, I wanted to shift the viewpoint of this issue which I think may give you insight into the other company's perspective. I would disagree that the company you are doing business with is being irresponsible. On the contrary, I see this as a sound business practice to wait until the last minute to pay what is due.

There is a concept in Finance called the Time Value of Money which states that it is better to have money now than later as money owned now can be invested for greater profit. In any medium to large business model, it is quite rare that a corporation will simply let their money sit in a checking account collecting no interest. Usually there exists a Treasury Department whose job it is (among other tasks) to reinvest capital in short-term (but risk-averse) financial instruments which will safely accrue interest while those monies are not in use. In a large enough corporation with the right instruments, sometimes these "idle dollars" can actually make the company thousands of dollars in profit over just a couple of days.

While your individual invoice might be small enough that the company is not going to win the lottery by delaying your payment a few weeks, it is important to note that a smart corporate billing department probably has a system in place where they wait until the last week of a bill's due date before letting go of the money. Over a large enough pool of bills, this will save them real dollars over a given time frame. Conversely, the Accounts Receivable department will have a similar motivation to get paid as soon as possible (just like you are trying to do).

So it is really a universal good business practice... you should always try and collect your payments as quickly as you can while delaying your bills as long as possible. To this end, adding stipulations in your contracts that support these goals is an absolute must. I've seen a variety of "tricks" to accomplish this including "carrots" such as offering small discounts to a bill for items paid within the first 15 days to "sticks" like including progressive financial penalties for bills not paid after 45, 60 and 90 days.

3

Tricky situation: There could be a few different things going on

  1. Administrative hiccup or incompetence (most likely)
  2. Intentional delay (happened to a friend of mine, they basically said "so sue us" )
  3. Budget or accounting problems (there is no bucket to pay you from)
  4. Something more nefarious (they intentionally cheating you)
  5. Any combination of the above

Ideally you manage this without damaging the relationship (at least not right away). Your best shot is to work through the hiring manager to the person who benefits most from your work. Initially, stay positive and constructive. Something like

Hi, I really like working for you guys, but I haven't been paid yet for the last xxx weeks. I'm sure it's just a paperwork problem but it would be great if we could address it. The kids got to eat and if I don't have any payment by YYY date, I see no other option but to stop working for you and find another source of income. I really don't want this to happen, so I appreciate any help you can provide

That approach has worked well for me in the past.

  • 1
    That kind of mail would be appropriate only after 30 days. Before, it'll absolutely not be appropriate. – cst1992 Apr 9 '16 at 12:21
0

It is very possible when you sent the email, especially if the subject line contained "Invoice" or "Receive" and/or the invoice was in an older Microsoft Office document type, that it was rejected as possibly containing malware by their email service. Very serious forms of ransom-ware are being sent in emails purporting to be "Invoices" using old Microsoft Office document types. Many email services error conservatively and block almost anything fitting the description, including email containing valid invoices.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.