6 Steps To Take When You Don’t Receive Payment

Safety Training Tips To Reduce Worksite Injuries

While there is no way to guarantee payment on the projects you work on, it’s essential to pay attention to details that can help make this process easier and/or faster. Keeping accurate records and documentation in regards to what is expected of your company is vital. Get your clients to sign off on every step, especially that of changed orders. Make it clear that additional work not specified on the signed contract might cost more money.

Unfortunately, getting a customer to pay you is no easy feat. However, completing these six steps when you don’t receive payment can help in reducing the stress factor of it all.

Step 1: Access the Damage

How much are you owed? When did you receive the last payment? How many days have passed since you sent out the last invoice/statement? Also, what type of customer are you dealing with; is it a public or private firm? Have you encountered this problem with them in the past or are they typically very prompt with their payment?

Answering all these questions will give you a better look at how dire your situation actually is. Usually, if this is the first time a client has missed a payment, then it can be cleared up with a simple reminder call or email. We all forget stuff every now and again. However, if you’ve had to consistently remind someone to pay you, then you might need to take a firmer stance.

Constant Contact

Step 2: Keep in Constant Contact

In these types of situations, it’s always a good idea to be proactive. Five days after your client misses a payment, try to contact them via email or try to call an accounts payable department, if possible. This is the time to ensure that they have all the right paperwork to process a payment and to ask questions about any concerns or issues the client may be facing at the moment.

If your invoice is 30 days past due, go ahead and try to reach out to your client once more. Again, ask questions and make sure that they have necessary paperwork for payment. Always be polite. If you’re still not receiving payment, contact again after 45 days past the due date.

Step 3: Charge A Late Fee for Outstanding Balances

This may be something that you want to include in your contract upfront. That way, it’s no surprise to the homeowner when their payment keeps increasing. Also, you’ll have that information in writing form if/when you decide to take legal action. Hopefully, knowing that there’s a possibility to owe you more money, the client will usually just end up paying. Bear in mind, it doesn’t always work out this way.

seek a lawyer

Step 4: Seek Out A Lawyer

You really want to think long and hard before taking this next step. Of course, getting a lawyer means taking even more money out of your pocket. The first thing is to find out whether a lawyer is charging an hourly rate or will take a percentage of the settlement. These percentages can be anywhere upwards of 30%. The goal after hiring a lawyer is to get the situation rectified (or to get your questions answered) as quickly as possible, since the rate tends to depend on how long you use the services of a lawyer. In this case, don’t be afraid to ask questions that will keep you in the loop. For instance, ask what they are doing, why they are doing it and even suggest alternatives, if you’re comfortable.

Step 5: File A Construction Lien/Lawsuit

When filing a construction lien, you need to find out the timeline in which it is effective in your state. Some are only effective six months after the project is complete, while other states might give you more or less time to file. Because a lien gives contractors a security interest on a property until they have been paid for their work on that property, it shows your clients just how serious you are about obtaining what’s owed.

A lawsuit should be last case scenario. Again, it is important to pay attention to the cost and the timeline, as your time to file a lawsuit can expire. Keeping the doors of communication open with your lawyer at all times is an absolute must. Don’t try to do this alone. It’s easier to win a case if you have proper representation rather than going at it on your own. Your lawyer will provide you with crucial information in regards to your next steps that you may not have been aware of.

Tip: As you can imagine, filing a lawsuit can become very frustrating. The best you can do is provide the necessary information to the court and let the judge take the situation from there.

be professional

Step 6: Be Professional if Disputes Arise

It is common for disputes to arise on the job. As a professional, you should investigate any and every concern your client may have. Offering a solution to these disputes can elevate your reputation within the industry, but also allows your customer to feel comfortable with your business and trust the services you offer. You will not agree with all of your customer’s disputes. Some may use this as a way to hold payment, while others will try to get you to perform additional work that was not stated in the original contract. In this case, present them with the signed contract and make it clear that any additional work will cost more money.

Bonus Step: Knowing When to Give Up

I know after dedicating plenty of hours to get the problem resolved and having to come to this conclusion may be frustrating, but it is important to note that this may be the only resolution. We don’t all get the fairy tale ending we want and hopefully, you won’t have to come to this, but keep in mind that it is a possibility. People leave town, companies go out of business, either way, you need to figure out how to be OK with the outcome.


Don’t Freak Out! As frustrating as the situation may get, it’s important to remain calm. In many cases, it might be easier said than done, but try to stay positive. Regardless of the outcome, be content that you gave it your all and maintained a professional demeanor throughout the situation. Don’t rant about it on social media or talk badly about the client to someone within the industry. This might hurt you in the long run.

What steps have you taken when you didn’t receive payment? Did you eventually receive what was owed to you? Tell us in the comments below.

This article was written by Dorcy Castillo.