ContractorUK readers were recommended last week that out-of-pocket agency contractors should send a formal payment request to their closing or closed recruitment company when dealing with unpaid invoices and overdue payments.
It's a sound recommendation for contractors facing late payment issues.
But the article emerged without a debt recovery template for such a formal payment request, so we're stepping in to provide this essential debt collection tool, writes Adam Home, managing director of Safe Collections.
If you need to send a formal payment request to a bust recruitment agency — or any other commercial debtor — you can use this free payment template below as a basis for an email or hard-copy postal demand letter to recover outstanding fees.
Formal payment request: must-includes for debt recovery
A formal payment demand for debt collection must include the total amount currently outstanding for payment, along with a clear deadline for receipt and an explicit statement as to the steps you will take if payment is not made by this date.
Contractors dealing with late payment from recruitment agencies may also wish to include a separate statement of account or copies of the unpaid invoices, as well as confirmation of the contractually agreed payment terms stated in the contract.
Similarly, if both entities are UK-based companies, then you can also include a reference to statutory late payment penalties and commercial debt interest charges. For the official position on debt recovery rights, check the .gov here.
Finally, if your contractor company can accept online payments, this debt collection template is an excellent time to remind your errant recruitment agency (or client) of exactly how the overdue payment may be enacted to resolve the outstanding debt.
------------------------------------------------------------------------------ [Date] Dear Sirs, Outstanding Account Value: £[XX,XXX.XX] As of today's date, we have yet to receive payment of the outstanding amount outlined above, which is now considerably beyond our contractually agreed payment terms of [xx] days. You will note that we have not yet levied any late payment or interest charges under "the Late Payment of Commercial Debts (Regulations) 2013"; however, your continued reluctance to bring this account up to date may leave us with little option. [Optional] You can make payment online here: [link] / You can make payment to our account with the following details: [xx] Please ensure payment of the full balance is received by us within the next [x] days. Failure to do so may result in us escalating this matter to our commercial debt collection partner, Safe Collections and needless to say, they will immediately apply these late payment costs and interest, along with their fee for recovery of the balance owed. [Alternative] Failure to do so may result in us escalating this matter to our commercial litigation partner for the issue of legal proceedings in respect of the balance owed, plus all applicable late payment costs, interest and associated court and legal fees. We trust this will not be necessary and look forward to receiving full payment by the stated deadline. Yours faithfully, [xx] ------------------------------------------------------------------------------
Free payment request template for bust recruitment agencies – additional notes
The above formal payment request template for recruitment agency debt recovery should give most contractors a solid base to build their late payment demand on when dealing with unpaid invoices.
Always remember when using this debt collection template, keep the tone polite and business-like in your payment request letter.
In addition, do not be tempted to indicate you are in any way in need of the funds in your formal payment demand, as some commercial debtors will use this statement against the creditor during debt recovery negotiations.
Finally, when sending your payment request to a recruitment agency, be prepared to follow through on any escalatory statement made on expiration of the deadline. This debt collection template is most effective when contractors are committed to the debt recovery process.
