Contractors' Questions: How to claim money owed?

Contractor's Question: I am owed quite a big sum of money by a recruitment agency. I have the purchase orders to show and they were pleased with the work, but they are four months overdue paying and ignoring my emails/letters.

I'm sending them a letter to ask for a final payment within two weeks before starting court proceedings. However as I need to pay £70 to start the case on the HMCS Money Claim website, what happens if they then pay me the day after I do this? Do I lose the £70? And is advisable to proceed in the avenue I've chosen to get my money?

Expert's Answer: I would recommend sending them a final notice letter giving them 14 days to make payment failing which you will issue proceedings. You should also add on interest for the amount outstanding.

You are certainly taking the appropriate action. Unfortunately some agencies/clients of contractors might need to be 'prodded,' in order to force their hand into paying. As for Money Claim Online, once you submit the claim it will be issued i.e. sent to the agency.

Your claim will effectively be for the money you are owed from the agency (with interest added) and also the costs i.e. the £70.00. So even if the agency pay up what they owe you the next day, the claim will still cover the £70.00 costs. Whether you choose to pursue the £70.00 is up to you. It is likely to be more hassle than it is worth and I would imagine pursuing them for this would destroy any chance of future work from them.

The expert was Ben Evans, of the internet and e-commerce team at Lawdit Solicitors.

Wednesday 10th Feb 2010