Bectu has welcomed the UK government’s plan to tackle late payments, which the UK creative industries union said is “absolutely critical” to protect the incomes of freelancers.
The legislative change forms part of the government’s small business plan, published yesterday. The changes mean the UK will have what the government is billing as “ the toughest laws on late payments in the G7 [Canada, France, Germany, Italy, Japan, the UK and US]”.
The government’s small business commissioner will be given new powers to carry out spot checks and enforce a 30-day invoice verification period to speed up resolutions to disputes. The upcoming legislation will also introduce maximum payment terms of 60 days, which subject to consultation may reduce to 45 days after five years, giving firms certainty they’ll be paid on time.
Audit committees, under the proposals, will also be legally required to scrutinise payment practices at board level, placing greater pressure on large firms to prove they are treating small suppliers fairly, backed by mandatory interest charges for those who pay late.
Bectu has thrown its support behind the government’s plan owing to the impact late payments has on freelancers within the creative sectors. According to the University of Reading’s BFI and Bectu-supported Screen Industry Voices report, freelancers make up around half of the UK film and TV workforce.
“Creative freelancers, many of whom work in already precarious industries, are particularly vulnerable to and impacted by late payments. And many feel that they can’t complain for fear of missing out on future work,” said Philippa Childs, head of creative industries union Bectu.
“A recent Bectu survey showed 47% of all creative industry freelancers often or sometimes wait more than 30 days for payment, with more than a third having waited more than six weeks. As a result nearly 4 in 10 have had their cash flow impacted or gone into debt.
“This is an absolutely critical issue for freelancers who already face difficulties due to the precarious nature and financial insecurity of their work. I urge the Small Business Commissioner to work closely with the promised freelance champion to do all they can to ensure that any new measures are aligned with the critical need for freelancers to be paid on time.”
According to the UK government, late payments cost the UK economy £11bn a year and shuts down 38 businesses every day.
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