Vodafone and Atos suspended from Prompt Payment Code

A telco and a tech services giant feature on a 17-strong list of companies that have been suspended or removed from the Prompt Payment Code for leaving suppliers out of pocket.

Vodafone and Atos IT Services are among the 12 firms suspended for not paying their suppliers in line with the PPC, under which 95% of supplier invoices are paid within 60 days.

Both the technology-centric companies were informed before their ‘suspension,’ which is preferable to ‘removal’ and affects five other firms that declined to offer an ‘action plan.’

'Committed to making changes'

But such a plan detailing how to reflect the PPC in future has been hatched by Vodafone and Atos, showing both firms are “committed to make changes” to pay their suppliers promptly.

A spokesman for the Charted Institute of Credit Management, which administers the PPC, added: “This is the first time that suspensions/expulsions have been formally announced.”

The CICM spokesman also told ContractorUK: “The purpose of the code is to encourage best practice and it is therefore pleasing to see how some of the companies have responded positively to approaches from the PPC Compliance Board.”

'No satisfaction'

However, the institute's chief executive Philip King expressed ‘disappointment’ that some suppliers are being treated unfairly on payment practices by now-former PPC signatories.

Their names are published separately on ContractorUK today, but the five which Mr King alluded to include a logistics business, an aerospace company and an international construction firm.

He said yesterday that he took “no satisfaction” in naming the five publicly, although all are prior suspendees who either failed to offer an action plan or failed to engage with the institute.

More removals and suspensions are expected in the second phase of the CICM’s review , which is currently underway, as the 17 firms named so far were for payment practices in Q1 2019.

'Raise a complaint'

Asked yesterday what action suppliers like limited company contractors should take if their client is a PPC signatory but appears to be flouting the code, the CICM spokesman said:

“[Such] suppliers are strongly urged to… highlight poor payment practice to the PPC Board and raise a complaint that will enable…[us] to investigate.”

At the time of writing, more than 2,500 companies have signed up to the code, which has the backing of the Small Business Commissioner, Paul Uppal.

The disclosure of the 17 firms breaching the PPC follows a government pledge that from this September, firms not paying suppliers promptly could be barred from government contracts.

Editor’s Note: Related –

When your limited company isn’t paid on time

Forget 40 days, us AMS contractors actually face an 85-day wait to get paid

Contractors’ Questions: Whose payment terms dictate; mine or theirs?

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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