Summary

  • On a contract desk you pay workers weekly but often bill the client monthly, so the money goes out long before it comes in.
  • Construction clients are the sharpest version of this: they pay later than any other UK sector, and retentions and applications for payment stretch it further.
  • The lever you control is collections. Making sure your unpaid invoices don’t go overdue is the way to keep cash flow under control.

Why a contract desk is particularly vulnerable to cash flow issues

On a contract desk, you’re running a “pay and bill” model: paying the worker for hours delivered, then billing the client for the same hours.

The issue is the worker gets paid weekly. That’s not negotiable: operatives on a site expect their money on a Friday, and if they don’t get it they walk to the agency down the road.

Meanwhile the client pays on their terms - or after some delay. Construction has the worst average payment delays of any UK industry, running to nearly 40 days beyond the agreed terms, and that’s on top of contractual terms that are often 30, 45 or 60 days to begin with. Layer a 5% retention and a slow certification process on top and you can be two months or more out of pocket on work you’ve already paid your operatives for.

You are, in effect, lending your clients the wages of every contractor on your books, interest-free, for weeks at a time. On a thin contract margin, the cost of funding that gap can be larger than the margin itself.

Specific reasons a payment may be delayed for a contract desk

There are several steps of paperwork to getting a payment over the line. Here are some ways they get delayed:

  • Timesheet approval. Payment is triggered by approved hours, not by the invoice. If the site manager hasn’t signed off the timesheet, the invoice can’t go out clean, and anything you do send is easy to query.
  • Applications for payment and certification. On larger construction contracts you’re not just invoicing, you’re submitting an application, waiting for a payment notice, and watching for a pay-less notice. Miss a date in that cycle and the payment slips a whole month.
  • Retention. A slice of the value, often 3% to 5%, is withheld and released much later. It’s easy to lose track of what’s being held and when it’s due back.

None of these is someone ignoring the invoice but the fix is the same: get the paperwork clean early and start chasing the invoice as soon as possible.

What good credit control looks like for a temp recruitment agency

Here are a few process tips to make sure you are collecting invoices as quickly as possible.

  • Start chasing before the due date. On slow-paying clients, a polite reminder of the upcoming due date and asking for confirmation it’s been received into their system can speed up payment.
  • Never let an approved timesheet sit. Signed hours are money you’ve already paid out. The invoice for them should go the same day and invoice reminders should start a maximum of 7 days later.
  • Keep genuine queries out of the auto-chase. The moment hours or a rate are legitimately disputed, that invoice stops getting standard reminders and gets worked by a person. Everything else keeps moving.
  • Use your statutory rights on the clean ones. An undisputed invoice that’s simply overdue can carry statutory interest and compensation under the Late Payment of Commercial Debts Act. The 2026 reforms are tightening this further, with a hard cap on payment terms and interest set at 8% above the Bank of England base rate. See how to apply late payment fees as a recruitment agency for the mechanics, and note that retentions and genuine queries are not the place for them.

Automating credit control for recruitment agencies with Trove

Trove’s job is automating credit control. It’s built to shrink the gap between paying your operatives and getting paid for them.

You can start chasing before an invoice is due, reminders run as a fixed sequence per customer the moment an invoice is raised, and you can enrol different types of customers in different workflows.

Trove’s kanban board is built for exactly the triage a contract desk needs. Columns are configurable, so a queried timesheet or an application under a pay-less notice can be dragged into its own column and held out of the standard sequence, while genuine stalls keep getting chased.

Trove runs a free 30-day trial and connects to Xero in about fifteen minutes. Start a free trial or book a demo.

Frequently asked questions

Should I just use invoice finance or factoring to cover the gap?

It’s a legitimate tool and plenty of contract desks use it to bridge weekly payroll against slow client terms. But it costs a percentage of your turnover, and the amount you draw is driven by how slowly you collect. The tighter your collections, the less you draw and the cheaper the facility gets. Faster chasing doesn’t replace finance, it makes it cost less.

Can I charge a main contractor late payment interest?

On an undisputed invoice that’s simply overdue, yes. Statutory interest and compensation apply under the Late Payment of Commercial Debts Act, and the 2026 reforms make that harder for large clients to sidestep. A queried timesheet, an application still going through certification, or a retention balance is a different matter and shouldn’t carry a late fee. The detail is in how to apply late payment fees as a recruitment agency.

For the wider picture of why agency invoices are harder to chase than most, start with credit control for recruitment agencies.