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Five late payment legal tips for subcontractors

Taylor Wessing senior counsel Natalie Pilagos gives her top legal tips for tackling late payment.

Don’t hide the problem

If there are problems, don’t try and hide them. Flag them when they happen.

This is because money may be taken off your final invoice as a result of issues discovered with your work on the project.

If you can agree solutions to problems as you go, it’s easier to manage and report this to your board. Otherwise you may find out at the end that you don’t get the large payment you were expecting and land yourself in problems.

You can also build a better relationship with the client by flagging problems and offering solutions.

Is the price right?

Make sure that the way you have priced the job is very clear.

If you can’t tell how much money has been aportioned for each aspect work you’re doing in the contract documents, you will not know how much money you are entitled to apply for for that specific item.

You should have a pricing schedule or something similar and it should be clear how much you will be paid for specific part sof your work.

Keep a record

It is important to keep a paper trail.

On any job, someone should be in charge of documents: how they are stored, where they are stored, and making sure they are up to date with everything on file.

Otherwise, it may take months for you to figure out what evidence you have.

It will also be easier to track who is accountable for problems if you are organised and keep a record.

Serve your contractual notices

It will preserve your contractual entitlements if you serve delay/loss and expense/objection notices.

Understand how your payment mechanism works

For example, if your employer has not served a pay less notice on time – or it does not explain the sum due or the basis of the calculation. You may be able to leverage off this.

Readers' comments (1)

  • To help us get somewhere useful, payment culture wise, can we stop calling subcontractors ‘subbies’?

    Unsuitable or offensive? Report this comment

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