Help with Late Payment Policy

[twiggy]

I need to revise my late payment policy as unfortunately the one I already have does not deter some parents from paying me late. At the moment I make a £10 charge if a payment is late, after 7 days I then charge £3 a day if there is still no payment. I have the right to refuse to have the child/children after 14 days if payment remains outstanding. I have linked my late payment policy to my contract by stating that "my late payment policy dated ../../.. forms part of this contract.

I am thinking of increasing the charge to £25 if payment is late which is what I get charged by my bank if my direct debit fails, I would then keep the £3 a day charge and the right to refuse to mind the child/children after 14 days. I would obviously decide at the time if I would implement the policy depending on the circumstances.

Do you think this is reasonable? Ideally I would like to state if there is no payment there will be no childcare as to wait 14 days just increases my losses if they don't pay. I get paid in arrears so have already provided the care.

What do you all do?

Thanks

Twiggy

[Mrsh3103]

That sounds pretty much like what I've got. Although I charge £5 per day.

[JoRo163]

I charge £5 per day too, and will withdraw care after 14 days.

[hectors house]

I don't have a late fee policy, mine all pay in advance either weekly or monthly (if paying by vouchers). I wouldn't give them 14 days to pay before I refused to take child especially as already paying in arrears. The parents who keep paying late I would change to paying weekly in arrears and if they still hadn't paid by following Wednesday (cleared and in my bank account) I would refuse to offer any more care.

[CLL]

Mine is payment in advance on the 1st of the month for the coming month. No payment on the 1st no care on the 2nd. My parents are very aware of this and all make childcare payments a priority as they know they will not be able to go to work the next day. 14 days is too long.

[AliceK]

I charge 10% per day. I have only had to charge a couple of times. I also get paid in advance. 14 days to wait before suspending care is too long IMO.

xxx

[Kiddleywinks]

£10 per 24 hours or part thereof, withdrawal of care after 3 days, rigorously enforced now, no late payments since enforcement

[miffy]

I'd switch to payment in advance which is what I do.

No payment = no childcare.

Miffy xx

[twiggy]

Thanks for your replies, how would be the easiest way to get parents from arrears to in advance? Would it work if I charged for 1.5 months for the next 2 months as most of my parents could not afford to pay out 2 months money to go in advance.

[Mrsh3103]

I'd probably only do it for new parents or for bad payers. Any that are always on time I'd leave as paying in arrears if you think they'd struggle

[hectors house]

I swapped my parents over gradually in April & May when there were several bank holidays - they just paid me the same amount for the month (although I don't charge for bank holidays) and that way they didn't notice the difference. None of mine come for more than 3 days a week and only a couple were still paying in arrears all the latest ones were already paying in advance.

Have you got any holiday booked off and are the parents finding free childcare or staying at home? - maybe they could pay you while you are off which goes towards you being paid in advance - make sure you keep accurate records as it can get complicated during change over period.

[Simona]

Thanks for your replies, how would be the easiest way to get parents from arrears to in advance? Would it work if I charged for 1.5 months for the next 2 months as most of my parents could not afford to pay out 2 months money to go in advance.

Best way is to review your contract ASAP...say in Sept
Make 1st of month your fees 'due' date in advance
No pay after 3 days means no care

Make sure you have a 4 weeks deposit from all NEW parents...if none of the safeguards you have in place work then you use the deposit as your fees