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I wk @ local facility of National Company, ? pay indpnt contrator- Michigan Michigan

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  • I wk @ local facility of National Company, ? pay indpnt contrator- Michigan Michigan

    I provide a part time service to a local facility that is owned by a national company. Their corporate offices are in California. I bill them via a paper invoice given to the local person. My checks come from the national company.
    I was told they do not issue a check until 30 days after the last hour billed on an invoice. Additionally that they only accept monthly invoices.
    What laws are they subject to abide by?

    Their "rules" mean on any given invoice for the first day [billed] I wait 59 day's to be paid; the last day [on that same invoice] I wait 31 days for payment.
    To further exacerbate the situation there is no consistency in their payments.

    Currently I am waiting for a check to cover hours worked 89-59 days ago.
    This is a company that is traded on the NYC, not a small organization in any way.

    Other than this problem I truly enjoy working there and do not want to
    endanger my job or create ill will.
    Please advise and thank you.

  • #2
    To answer your specific question, the payment terms should be defined in the contract. If they are in breach of that clause, your only recourse as an IC is to sue. Wage and hour laws do not apply to independent contractors.

    Having said that, the bigger elephant in the room is whether you meet the criteria to legally be classified as an independent contractor.
    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.


    • #3
      Basically they are setting up their own cash flow rules to suit their budget, and they are probably treating you the same as all of their vendors. If you have a signed contract that specifies payment on a different time frame, then you should absolutely point that out to your client, and hold firm.

      If they tell you "these are the new terms" then you have the right to find a new client.


      • #4
        I had read up about employee status and agree that I'm in "no mans land" here. I tend to think I don't qualify as an IC although I'm paid like one. While there is no direct signed contract between this company and myself, there is a non-profit organization that has a contract with them, which is how I then get hired or placed. Sounds loose when I type it out! I'm normally a black and white, with understanding kind of person. I am well paid for what I do and again the local management are nice and I enjoy them. But since nice don't pay the bills....................


        • #5
          Not my area of expertise. Although Accounts Payable generally reports to me, and I am generally on the other side of what you discuss. And I have worked for one employer who played these sorts of games, so I can give you the general rules, which you will not like.
          - Federal law (such as it is) is the Uniform Commercial Code (UCC). That law suggests that net 30 is "reasonable". Key word is "suggests".
          - States have local versions of the UCC. Your state is not my state and I have no idea what MI thinks about this. I can say I am in CA, and CA would be less then helpful to you in your position. There is assumption that standard terms are net 30 unless the contract says otherwise. Smart customers (not employers since you are not an employee) spell out contract terms that they can handle. The absence of the contract tends to make the net-30 the default (although I still do not know MI rules).
          - Assuming that the default in MI is indeed net 30, assuming that you have no formal contract (bad on you), and assuming that MI actually cares about anything of this stuff in the first place, then basically your "recourse" is to take your customer to court and ask for interest or late charges on the payments, probably say 1%-1.5% on any payments more then 30 days late. Now again, I DO NOT KNOW MI RULES. But this is route that UCC suggests and most states more or less follow UCC.
          - I can say that I worked for one company in the 1980s that was very slow to pay, vendors would send demand letters for late charges, interest fees, even sent those out to collections. To my knowledge, we never paid any of those fees. Ever. No one took us to court that I heard of. If we lost, I would have seen the payment, and I did not. Worse case is certain vendors would cut us off. I am not saying that if we had been taken to court, that we would not have lost. We likely would have. I will say that any tendency I might have had to be impressed by angry people on the phone making threats was lost on that job. My boss on the job was a major jerk, but he was not wrong on the risk/reward aspects of paying people late. His "golden" rule was that people who are going to take you to court, do not talk about it, they actually do it. And they most certainly do not send receivables out to "collections". He considered collections to be a "barking dog that never bites". That if the other person was going to take you to court, involving a collection agency (in state anyhow) just means giving away part of recovery for no reason. That you sent things out to collection when you had no intention of going to court, just in case the other guy was dumb enough to get bluffed.
          "Reality is that which, when you stop believing in it, doesn't go away".
          Philip K. **** (1928-1982)


          • #6
            DAW it's people like you that take the time ( a lot in this case ) to share what you know, with the intent it will help, that make such a nice difference in my day thank you very much.
            I tend to think I am without any formal recourse, but I do have one thing that is worth a lot.......I am very much liked by everyone and have made this part of their business grow. I'll continue to ask after the check in a pathetic attempt to get a multi-billion dollar company to shake loose a few measly hundred dollars. Thankfully this is not paying my house payment or feeding my kids.


            • #7
              One last point. Shake the tree all you want. Might work. Might not. But this assumes that the people you are talking to actually have any control over when payments gets made. I did not in the job in the 1980s. I might have been the so-called Accounts Payable Manager, and I had as many as 6 people reporting to me, but I did not control cash. If very senior management did not want to make to AP payments this week/month, we did not, other then to vendors such as utilities. People who could turn off things. Very often the people who answer the phones and issue the checks have no authority what-so-ever over when payments are made, no matter how loudly they get yelled out by third parties. I generally did not know until the day we scheduled checks (weekly) just how much money (if any) I would have to make payments for that week.

              Probably not what you want to hear.

              I made the point later in my career of only working for employers who actually had enough money to avoid such things.
              "Reality is that which, when you stop believing in it, doesn't go away".
              Philip K. **** (1928-1982)


              • #8
                That's the truth. I went from that type of employment to this. I've always been blessed with good income and benefits. I'm seeing the world from a different vantage point. It's good for all of us to experience what the other guy goes through. Humbles you for sure. Thankfully I am working because I want to not because I have too.