Parents not paid!

[KatieFS]

Don't you just hate it when parents don't pay on time. I ask for monies to be in my account by bank transfer if poss by 1st of month. 3 out of my 7 parents haven't paid. It's an occasional problem, but most months 1 or 2 are a few days late. Which then means all my debuts come out regardless and I'm immediately over drawn and then paying bank charges and affecting my credit rating.
I don't have a late payment charge or anything like that (yet) but maybe I should!???
What do you do? I hate having to ask for money...

[~Grasshopper~]

I would send a letter to all parents, i would put a £10 per day late payment fee in place and tell them you will have to change to advance payment if it keeps happening. All my parents know they have to pay me by the last working day of each week and since i started my late payment policy 2 have been paying in advance and no one is ever late xx

[clareelizabeth1]

You have to get tough explain why you need them to pay on time and late payment fee is a wonderful incentive for parents to pay.

[AgentTink]

I with a old set of parents got fed up chasing for money, so one month I advised them that from next month I would introduce late charges of £5 per day. I said if I had introduced already here is the charges they would have paid over the last few months. I then spoke to them about when their pay day was, which was on the 27th of everymonth and advised them to set up a standing order on that date. They were never late again and I never had to discuss fees with them.

Also to save yourself getting charges is there any direct debits you can move. Most companies will let you jig some of the dates around so that at least if your late being paid it might not impact you too much.

[shortstuff]

I would suggest you move your dd's to a week later. This allows for the odd hiccup. I agree parents should pay on time but you are always better having a buffer for yourself just in case.

[The Juggler]

i agree, time to lay down the law. Move your dd's as suggested to give time for the odd hiccup but then tell parents it's embarrassing to have to ask them for money and chase it. You hate using late fees but you feel you have no choice as you are incurring bank charges, and please can they ensure money is in your bank (no cheques) on the day it is supposed to be.:thumbsup:

[KatieFS]

Well we have loads of debits going out on 1st so don't think it's realistic to move all those. I expect people to pay me on time. If they can't manage 1st if month maybe ill put it back to allow them more days. Ill advise parents of the difficulty I'm having, start txt alert then if doesnt change will bring in late payment charge and pull payment date forward a few dats
Thanks for your replies. I've seen a few other similar threads so know I'm not alone! X

[bunyip]

Well we have loads of debits going out on 1st so don't think it's realistic to move all those. I expect people to pay me on time. If they can't manage 1st if month maybe ill put it back to allow them more days. Ill advise parents of the difficulty I'm having, start txt alert then if doesnt change will bring in late payment charge and pull payment date forward a few dats
Thanks for your replies. I've seen a few other similar threads so know I'm not alone! X

No offense meant, but...........

These late-paying parents are deliberately pushing agreed contractual boundaries. If their children were pushing boundaries, would you be putting your foot down (politely but firmly) or moving those boundaries to accommodate the children's behaviour? Hmmm? So why treat the parents any different?

Changing the payment date to accommodate bad-payers does not strike me as sending the correct message. If anything, it says exactly the opposite. To put it bluntly, since they're currently st1ff1ng you, why are you prepared to bend over backwards just that little bit further?

If you expect people to pay on time, then your actions should reflect that expectation. Why on Earth do you think you need to tell parents you're having difficulties (as if they'd care?) :huh: And no CM should have to explain their personal/financial circumstances in order to persuade a client to fulfil their contractual obligations. Your personal finances should be, well..... personal. Go ahead and tell them: as far as they're concerned, that's your problem. At least it will be until you decide to make it their problem. This is a business issue and it demands a business solution - not a charitable appeal to the parents' better nature (assuming they have one. :mad: )

Here's what I'd do (er, already do.) Apply late fees, as per your contract. Contact your insurer/professional association for advice on your possible options to withhold care until paid in full. Arrange an urgent contract renewal and put in place a straightforward policy of payment in advance, with no payment = no childcare, with no exceptions. Parents who know they will be turned away at the door if they don't pay will very quickly find a way of keeping up to date with payments. Your other option is to maintain the status quo, and be sure that you will be a long way down their list of financial priorities, somewhere behind their SKY subscription and having their nails done. :(

[samb]

For the first time in a long time all parents have paid all bits of their invoices on time! I often find a particular family pays either their vouchers or the top up on time and the other bit a couple of days late which is always awkward - however this month they paid on time - but then handed notice in the next day so I guess they were doing the right thing before leaving?!

[KatieFS]

Bunyip... Harsh but fair. I feel the same, but guess I don't want to alienate the parents. Also where I stand contractually, as late payment charge isn't in my contract. Would I need to resign all new contracts or just add something to my fee structure 'policy'

[bunyip]

Personally I would put it in a new contract and get it signed. I always think that way is better for big changes and involves a degree of sitting down listening to one another (even if it's something you're going to insist on.) Policy changes are ok but best kept for minor details in how you work. The difference is subtle and often difficult to put your finger on, but still important.

In fact whether a CM changes a policy or redraws a contract, either way it still really needs to become effective after allowing for the usual notice period (always unless both parties agree to waive the period.) I think some CMs believe they can effect significant changes immediately and without the client's consent, just so long as they put it into a policy amendment instead of changing the contract. But it doesn't work like that. I actually know of one CM who decided to stop doing Tuesday school pick-ups so she could take her DS to soccer training. Without consulting, she put it into a policy over the weekend and presented it to parents on the Monday, effectively giving them 24 hours to make alternative arrangements. And she was genuinely surprised when an angry parents told her to reconsider or she'd be hearing from their solicitor. :panic:

I appreciate what you're saying about alienating parents. It's a difficult balance, particularly when it looks like you're offering terms which are more strict than what they've been used to. That often means having to find a way to 'phase in' the change rather than a shock to the system which risks losing them. The answer lies somewhere between the 2 extremes of "not alienating parents" and "being so accommodating that we become a doormat". :p Sadly, at the end of the day, you may be in a location where the client could take their child elsewhere and get better terms. In which case, you're faced with the stark choice of keeping or losing a client, albeit an unreliable one who may well eventually walk away leaving you unpaid for a month or more. :(

I know it sounds harsh and that it can be difficult for parents to pay in advance. Incidentally, I don't mind parents avoiding financial hardship by paying me daily (which I offer, but my regulars still choose to pay monthly in advance.) I think a lot of parents and CMs forget that paying in arrears should be a regarded as a privilege and not a right.

The awful truth is these message boards bear witness to the painful consequences many CMs have suffered through accepting payment in arrears, which slide into ever later payments, and bad debts with CMs left powerless to recover money they have worked for and will never see. :(

[KatieFS]

Yes of course i would give appropriate notice, and prudent to get new contracts signed if I did do late payment fee.
I will draw up a letter to my parents to tell them a number of people have been late paying do ill send a text 5 days before payday to give them the chance to organise bank transactions etc. the late payment fee is a final option, so hope I don't have to go to that but yes I expect to be Paid on time and if they can't manage that then find another cm

[Simona]

In a few days time it will be the start of a new financial year so why not reflect on what changes could be made to avoid non payments and other matters which are agreed in the contract but 'forgotten' by parents

1. do you hold a deposit?...4 weeks is totally acceptable. You can use this for late payments or cover yourself if parents do not give you the agreed notice. It does work as parents are keen to get this back

2. have a clear date on your contract or your added terms and conditions when you expect to be paid...in advance or arrears the money should be paid when you have agreed unless the parents inform you of any problems for the delay (usually invoice has been filed at bottom of their pile!!)

3. at the bottom of your invoice do you have a reminder of the date fees are due ie:1st or 2nd of the month or whatever?

4. do you give parents an invoice a few days ahead of the due date to ensure they have time to comply?

5. state clearly in your policy/contract/T&C that if any payments are late and no notification given for the reason you will charge 'a late payment fee' (you decide the amount)...I deduct this from the deposit I hold before refunding it showing clearly which months fees were late ...it works

6. if parents are consistenly late in paying you could tell them you will withdraw the care for the unpaid period

7. when parents give you notice they should pay you normal fees for the month the notice applies to, you work your notice then if no extra hours are to be added refund the full deposit minus any late payment fees....

8. do you take c/vouchers? if yes get the parents to set up a standing order when they get released on the same date each month (all my parents release the c/vs on the 28th for the following month...works wonders and always on time)

Come on girls ...like bunyip implies don't feel sorry for the parents, let them stick to the contract as it is mutually agreed and legally binding both parties

[KatieFS]

Thank you all. Great advice which I will put into practise. I can't have another month of having no money.

[jackie 7]

I get paid weekly in arrears. This suits me but I have a late pay policy. So far I am ok but I also would tell a parent they have to pay in advance if needed. You can change your policy when needed now it is needed. Write a letter and keep a copy. Day as they have a history you will now bd charging late payments. Remember a nursery will charge the same if not more and always In Advance

[angeldelight]

Bunyip... Harsh but fair. I feel the same, but guess I don't want to alienate the parents. Also where I stand contractually, as late payment charge isn't in my contract. Would I need to resign all new contracts or just add something to my fee structure 'policy'

That's the problem Katie we like to be fair and keep parents happy ...and they know it

It's easy to listen to the great advice ...not so easy putting it into practise though

I'm fair like you and would prob do as you suggested give them a letter 5 days ahead ...give them the benefit of the doubt

See how that goes then get even tougher if it does not work

If you don't want to change to having payments in advance I would def start it with every new parent you get in future

We live and learn Katie and you will too

Good luck with whatever you do ...keep us posted

Angel xx

[KatieFS]

Thank you. I'm gong to do a letter with the invoices this month about it, and text as we approach dead line. If doesn't improve I will have to start imposing late charge.