Interested in more careers-related content? Check out our new weekly Work Life newsletter. Sent every Monday afternoon.
THE QUESTION
I work as a contractor for a big company through an agency that pays my salary. The issue is that the payments are often delayed, by as much as two or three months. I literally have to beg for the payment and it is very stressful. If I quit, I fear I will lose those months of my salary altogether, so I am stuck in this vicious cycle. What should I do?
THE FIRST ANSWER
Alia Besharat, associate, Ogletree Deakins International LLP, Toronto
Since you are being paid through the agency which placed you with the company, your recourse, if any, would be against the agency and not necessarily against the company that is using your services.
My advice would first be to contact the agency directly, in writing, to demand payment of the outstanding invoices. It is also recommended to ask them to provide a timeline as to when exactly the payment can be expected. Your demand should be in writing in order to keep a paper trail of the communications should they need to be relied upon. The invoices attached to the demand for payment should be as specific as possible in terms of the dates the invoices were issued, the services rendered and the payment due dates.
In the event the agency does not respond or make payments, I recommend that you take it a step further by providing a date or deadline by which they must pay the outstanding invoices before you seek legal recourse. In the event they miss the deadline provided, you can hire a lawyer to bring a claim for breach of contract and payment of the outstanding invoices in court.
This can be costly and time-consuming, however, this can be avoided by having a well-documented and formal contractor agreement between yourself and the company or agency. The contract should identify what happens in the event an invoice does not get paid on time. Lastly, if you do take legal action, you will need to do so within two years of the non-payment so that you are within your limitation period.
THE SECOND ANSWER
George Huang, managing partner, Skyline Legal Group LLP, Calgary
Assuming you are an independent contractor and not a dependent contractor, standard contract law would apply to your contract. Remember that your contract is still with the big company, and an agent pays you on behalf of your client. You will need to go back to your contract terms and review what are the terms of payment.
Assuming you have the standard 30 days to pay, you should be able to charge interest on any delayed payments over the 30-day grace period. The question becomes whether you will want to get into an argument with the delayed payments and result in the big company terminating your contract.
Assuming the big company is reasonable, you will need to tell them that its payment agency is causing payment delays and that you will charge interest if it continues to occur past the grace period. The main risk for unpaid work is that the big company refuses to pay it, but that would open the big company up to breach of contract or unjust enrichment given the work has been completed.
If you are a dependent contractor, then employment law may apply, which may entitle you to go to your provincial employment standards office for unpaid wages.
Given so much depends on the terms of the contract and whether you are a dependent or independent contractor, you should consult a lawyer to give you advice tailored to your situation.
Have a question for our experts? Send an e-mail to NineToFive@globeandmail.com with ‘Nine to Five’ in the subject line. Emails without the correct subject line may not be answered.