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Jo C.
Jo C., Barrister
Category: Law
Satisfied Customers: 71159
Experience:  Over 5 years in practice
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Is it legal company to say their payment terms are:

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Is it legal for a company to say their payment terms are: You will get paid when the client pays us.
Thank you for your question. My name is ***** ***** I will try to help with this.
Did you agree to those terms originally?
Or have they just amended them?
Customer: replied 3 years ago.

The situation is that I am a Ltd Company (Recruitment Agency) and I have a contractor onsite at Travis. It is end of contract time and Travis wish to renew but want to renew putting an MSP (managed service provider) ie another agency between us and themselves. It is the MSP (Harvey Nash) who are trying to get us to agree to new terms ie with the payment of they will pay us when we get paid but we'll keep paying the contractor.

So this is a variation but it is a new contract in reality?
Customer: replied 3 years ago.

I guess so.

I thought there was a law against that sort of clause - especially for small businesses ?

They cannot change the payment terms in the middle of the contract but they are free to impose any kind of payment terms they like such as 30 days, 60 days, 90 days, 120 days, or when they get paid.
It's very difficult to "police" because you have no proof when they get paid for therefore if you are forced into agreeing to this I would want a long stop date whereby they will pay you after (say) 3 months whether they have been paid or not.
If they won't go for that, you undertake what unfortunately, you're going to have to turn the contract down.
There is nothing illegal in what they are doing.
I'm sorry that this is bad news for you.
Can I clarify anything for you?
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