The monthly payment admin keeps slipping
Applications go out late, notices get missed, and every month the cycle costs us money or sleep.
Updated: . By Jack Butler-Kettle, Construction Claims Consultant.
What's happening?
Every month the same jobs come round: measure, value, apply, check what comes back and chase the money. When that competes with site work, a hand-off gets missed. Then nobody is sure which figure or which notice counts.
Each subcontract has its own rules. Dates, recipients, required documents and sign-off can differ from job to job. A routine that worked on one contract does not prove the next one works the same way.
Left alone, it costs real money. A late application can push a month's work into the next cycle. A late notice from your main contractor goes unchecked and is paid as if it were valid.
The solution
Map each contract's application date, due date, notice windows and final date for payment from the signed subcontract. Give every date a named person, a deputy and a reminder a few working days ahead. Decide in advance what happens when information arrives late or a deadline cannot be met.
Underpayment Prevention builds that diary with your team, proves it on a live cycle and hands it over. Every notice that comes back is logged against its window the day it arrives. If a slipped cycle has already cost money, Underpayment Claim checks it and recovers what the contract supports.
Example
Illustrative example. The scenario and figures are invented.
The facts
A fit-out subcontractor applies monthly on seven contracts. Three have amended payment periods and two have different application dates. The commercial manager keeps them all in memory.
What happens
- One month, the application on the largest job goes out 2 days late. The subcontract values it at the next application date, so £46,000 of work waits a month longer for payment.
- On another job a Payment Notice arrives a day after its window closed. Nobody checks, so a figure £3,800 below the application is paid as if the notice had been in time.
- All seven contracts are mapped into one diary: each application date, due date, notice window and final date for payment, with a named person and a deputy.
- Each application is built and sent from the same record. Every notice that comes back is logged against its window on the day it arrives.
The outcome
For the next three cycles every application goes out on its date, on every contract. The next late notice is caught the day it lands, not paid as if it were valid.