Prompt Payments

It’s accepted wisdom that to pay suppliers promptly, that is on time according to agreed terms, is fair. It astonishes me when businesses – and it seems that big businesses are the worse culprits – deliberately fail to pay on time and seem to think that this is a legitimate business practice. But it is equally astonishing to see small businesses failing to help themselves when their customers pay late. Some businesses are their own worse enemy when it comes to being paid on time and there is a few simple steps that they could be taking to minimize the pain of late payment.

There's a particular moral standard that simply doesn't stack up in my view. It's the standard that claims that if it's legal, it's OK. If it's within the rules, it's fair. We see it all the time. Employees who feel they are unfairly treated are told "If you don't like it, you know were the door is". Put up or shut up! The employer knows that the employee needs the job and if they do walk, there's plenty of potential replacements. Whether or not the employee is right in their complaint, the employer is using or even abusing their power over their staff. It's not fair. Large corporations spend huge sums of money employing the best legal minds in the world to show how they can arrange their affairs so that they avoid paying tax. Perfectly legal practices that are quite blatantly unfair - unfair to those tax payers who, whether out of a sense of decency or simply because they can't afford the best legal minds in the world, pay their fair share of tax. I'm not referring to the grey areas - there are lots of them - situations that are open to interpretation and opinion. No, I'm referring to those cases where any reasonable person would agree that a course of action is clearly, without ambiguity, contrary to the spirit and intention of a set of rules, a contract or an agreement. The fact that there is no breach of rules does not make the situation fair - it simply makes it legal. Which is why I'm astonished at the response from Philip King recently on the OB10 blog to a question about prompt payment.