Once an invoice is 30 days past due, stop sending reminders and start escalating: find out why it is unpaid, move up to the person who signed the agreement, and put every agreement in writing.
Offer a payment plan if cash is the problem. Use the remedies in your contract, such as interest or suspending services, only after you have read it, taken advice and given written notice.
Step by step
1Confirm the invoice is really unpaid
Check the bank feed for an unmatched or partial payment, and ask the client's accounts payable contact whether the invoice is in their system.
2Ask what is stopping payment
Ask one direct question: what is holding this invoice up? A missing purchase order, a disputed line and a cash problem each need a different next step.
3Separate any disputed amount
If the client questions one line, ask them to pay the rest now and put the disputed item in writing. Stop reminders on the disputed part and handle it as a conversation, not a collection.
4Escalate the contact around day 30
Copy accounts payable, then write to the person who signed the agreement. Keep your project contact copied.
5Offer a payment plan in writing if cash is the issue
Agree dates and amounts, and what happens if a date is missed. Confirm it by email the same day so both sides have the same record.
6Read your agreement before any formal step
Around day 45 to 60, find the clauses on payment terms, interest, suspension of services, notice periods and disputes. Speak to a lawyer before you send a formal notice.
7Send written notice, then a final notice
Give notice the way your agreement requires. The final notice names a date and the next step. Only say what you will do.
8Log every contact
Record the date, the person, what was said and what was agreed. A lawyer will ask for this log first.
Free tool
Invoice chaser
Paste your open invoices: each overdue one gets its reminder stage and a drafted reminder to review. Nothing is sent.
The first two weeks of a late invoice are covered in chasing a late invoice: a reminder a week before the due date, one on the day, and two more at 7 and 14 days. This guide picks up at day 30, when reminders have not worked and the invoice needs a reason, a date and a more senior contact.
Emily Rae, Finance Partner at Fletcher Priest Architects, told the RIBA Journal that delays often happen "because the invoice is stuck in the system, or has gone missing". Check and ask (steps 1 and 2) before you escalate.
The escalation plan, day by day
The cadence below is our suggestion, not an industry rule. Move faster if your agreement has shorter terms or a deadline is involved.
Days past due
Who you contact
What you ask for
Email
30
Project contact, accounts payable copied
The reason for the delay and a payment date
1
45
The person who signed the agreement
A payment date by a set day
2
Any time
Whoever agreed a plan
Written confirmation of the plan
3
60 or later
The signatory, as the agreement requires
Payment by a date, with the contract remedy named
4
After the notice date
The signatory
Payment or a signed plan before referral
5
Call as well as write at every stage.
What to check in your agreement
Before email 4, find these clauses in the signed agreement:
Payment terms: when invoices are due, and whether the clock starts at the invoice date or on receipt.
Interest: whether unpaid amounts carry interest, at what rate and from when.
Suspension of services: whether you may stop work for non-payment, how much notice you must give, and how the notice must be delivered.
Use of documents: whether the client's right to use your drawings depends on payment. The AIA guide suggests making deliverables contingent on payment.
The AIA's Getting paid guide adds agreeing different payment terms and holding other approvals to the list, with a lien or legal remedy further on. Those vary by state and have time limits. A lawyer who knows your state or country should read anything formal before it goes out.
Keep the money in its own thread
Your project contact is often not the person who pays. Put payment in its own email thread with accounts payable and the signatory copied, so a design conversation never turns into a payment argument. Agree who in your firm owns that thread.
What to record for every unpaid invoice
Add these columns to your invoice log:
Days past due, calculated from the due date (the formula is in the late invoice guide).
Reason given, in the client's words.
Last contact: date, person, channel.
Agreed payment date or plan, and whether it was confirmed in writing.
Status: Open, Plan agreed, Disputed, Notice given, Referred, Paid.
Replace everything in [square brackets], read the result, and send it from your own address. Email 4 quotes your contract, so have a lawyer read it before it goes out.
1. Thirty days past due: a statement and a direct question
When: Day 30. Send to your project contact and copy accounts payable. Call the same day.
Subject: Invoice [number] for [project]: 30 days past due
Hi [first name],
Invoice [number] for [project] ([amount]) was due on [due date] and is now 30 days past due. I have attached the invoice and a statement of everything open on the account.
Could you tell me what is holding it up? If something is missing on our side, such as a purchase order number, a supplier form or a revised copy, I will send it today.
I will call you on [day] so we can settle a payment date.
Thank you,
[your name]
[firm name]
2. Escalation to the person who signed the agreement
When: Around day 45, if you have no payment date. Keep the project contact copied.
Subject: [Project]: invoice [number] needs your attention
Dear [name of signatory],
I am writing about invoice [number] for [project], for [amount], which was due on [due date]. Despite reminders on [dates] to [project contact name], we do not yet have a payment date.
We want to keep [project] on schedule. Could you confirm by [reply-by date] when this invoice will be paid, or tell me what is preventing payment so we can resolve it?
The invoice and statement are attached. I am available on [your number].
Kind regards,
[your name]
[firm name]
3. Confirming a payment plan
When: The same day you agree a plan by phone or in a meeting.
Subject: Payment plan for invoice [number]: confirming what we agreed
Hi [first name],
Thank you for agreeing a plan for invoice [number] ([amount]). To confirm:
- [amount] by [date]
- [amount] by [date]
- [amount] by [date]
If a payment is going to be late, please tell me before the date. If a payment is missed without notice, the full balance becomes due on [date], as we discussed.
Please reply to confirm this is your understanding too.
[your name]
[firm name]
4. Written notice under the agreement
When: Day 60 or later. Use the clause numbers and notice method your agreement requires. Have a lawyer read it first.
Subject: Notice under our agreement dated [date]: invoice [number]
Dear [name of signatory],
This is written notice under [section reference] of our agreement dated [agreement date] for [project].
Invoice [number] for [amount], due on [due date], remains unpaid. [If your agreement allows interest: Under [section reference], interest applies to unpaid amounts at [rate in your agreement] from [date].]
[If your agreement allows suspension: Unless payment is received by [date], at least [notice period in your agreement] from today, we will suspend services on [project] under [section reference] until the account is brought up to date.]
Please call me on [your number] before [date].
[your name]
[title], [firm name]
5. Final notice before referral
When: When the date in your notice has passed. Name only a next step you will take.
Subject: Final notice: invoice [number] for [project]
Dear [name of signatory],
Invoice [number] for [amount], due on [due date], is still unpaid. We wrote about it on [dates] and gave notice under our agreement on [date].
If payment, or a written payment plan we both sign, is not received by [date], we will refer the matter to [our lawyer / a collection agency] without further notice.
I would still rather resolve this directly. You can reach me on [your number].
[your name]
[title], [firm name]
Frequently asked questions
When does a late invoice become a serious problem?
There is no industry rule. Our working line is 30 days past due: after that, you need a reason, a payment date and a more senior contact. Your agreement's terms matter more than any general rule.
Should I keep working on a project while an invoice is unpaid?
Usually yes, while you are still talking and a payment date is in sight. The AIA's Getting paid guide treats withholding services as a later step, best written into the contract up front and announced to the client in writing. Read your agreement and take legal advice before you stop work.
Can I charge interest on a late invoice?
Only if your agreement provides for it, at the rate it sets, and within what your state or country allows. If it is silent, ask a lawyer first.
What if the client disputes only part of the invoice?
Ask them to pay the undisputed amount now and put the disputed item in writing. The RIBA Journal article notes that a genuine dispute calls for a very different process from chasing.
When should I hand an unpaid invoice to a lawyer or a collection agency?
When written notice has not produced payment or a signed plan, or earlier if a deadline is involved. In the US, lien rights for design professionals vary by state and come with time limits, so speak to a lawyer early if a lien might apply.
Sources
AIA Best Practices, Getting paid (the options once conversation has not worked, including interest, withholding services and liens)
Archon & Partners