Sole Trader - Council Tribunal?

The_Viking_Pict

Crikey - I apologise for the length of this from the start.... but..... Details probably matter.

So I operate as a Sole Trader, I complete repairs for a couple of Councils in Scotland - what we do is a very unique, cost saving repair.... i.e. it saves the councils a whack of cash.

Anyways - I have done this for several years, and these councils have been my primary supplier of work. (70-80% or so?)
The work we get from them comes through on a pretty steady, and reliable level... so much so than I can quite happily say that we would expect about 12 jobs per months from one council, and 3 jobs per month from the other council. give or take 1 or 2.....

Last year, we invested heavily into the business to increase the professional image, and profile - annoyingly, these councils went through significant staff changes, budget cuts, and redundancies, too.

Fast forward to Summer this year, and job requests just fell of the cliff.
I have lost count of how many people I have contacted to find out what is or isnt happening - but (long story short) - I eventually have responses saying things like:
1) We have had extreme changes, and it is most likely that your details have been lost.
2) There is no issue, problem, or change in policy with regards to using you. The most likely issue here is staff changes, and system malfunction.. We suspect jobs to start flowing soon.

i.e. - they have categorically specified that there is NO issue in using us. There has been one or two jobs that have come through since then, which would at least back this up (there isn't an issue using us) - but no return to anywhere near the numbers previously expected...

It has effectively killed the business.

What I would like to know, is where do I stand here? What options do I have, and what might I consider?

I feel like there is case to be made for an "implied contract" with these suppliers - given that I can show, before cuts/staff changes/etc that they were sending us a CONSISTENT level of repair requests per month, for the previous 7 years..... After these cuts/changes, they have dropped to nearly 0.... but that we have correspondence from their head of repairs/management clearly stating that there is "NO issue with using us", and that these changes should have "minimal impact" on us.... one council has even sent us the odd repair request, just not the amount we come to expect.

If the business closes, it will be because of these primary suppliers and their own internal going-ons outwith our control. We have been in contact with them since the Summer, and have consistently been told there is "no issue"...

So..... if it fails -

Can I take them to an industrial tribunal? Sue them for loss of earnings, under an "implied contract"? What might my options be?

Thanks in advance for time and advice!

(ps.... I should maybe also add, that one of these council went through a radical account system change, that messed our invoices around a number of time over the last 2 years.... and really messed our cash flow... I have a letter from the accounts department admitting that they were to blame for non-payment of our invoices, leading to financial problems, and that it was through NO fault of our own.)

Undervalued

The_Viking_Pict wrote: »

Crikey - I apologise for the length of this from the start.... but..... Details probably matter.

So I operate as a Sole Trader, I complete repairs for a couple of Councils in Scotland - what we do is a very unique, cost saving repair.... i.e. it saves the councils a whack of cash.

Anyways - I have done this for several years, and these councils have been my primary supplier of work. (70-80% or so?)
The work we get from them comes through on a pretty steady, and reliable level... so much so than I can quite happily say that we would expect about 12 jobs per months from one council, and 3 jobs per month from the other council. give or take 1 or 2.....

Last year, we invested heavily into the business to increase the professional image, and profile - annoyingly, these councils went through significant staff changes, budget cuts, and redundancies, too.

Fast forward to Summer this year, and job requests just fell of the cliff.
I have lost count of how many people I have contacted to find out what is or isnt happening - but (long story short) - I eventually have responses saying things like:
1) We have had extreme changes, and it is most likely that your details have been lost.
2) There is no issue, problem, or change in policy with regards to using you. The most likely issue here is staff changes, and system malfunction.. We suspect jobs to start flowing soon.

i.e. - they have categorically specified that there is NO issue in using us. There has been one or two jobs that have come through since then, which would at least back this up (there isn't an issue using us) - but no return to anywhere near the numbers previously expected...

It has effectively killed the business.

What I would like to know, is where do I stand here? What options do I have, and what might I consider?

I feel like there is case to be made for an "implied contract" with these suppliers - given that I can show, before cuts/staff changes/etc that they were sending us a CONSISTENT level of repair requests per month, for the previous 7 years..... After these cuts/changes, they have dropped to nearly 0.... but that we have correspondence from their head of repairs/management clearly stating that there is "NO issue with using us", and that these changes should have "minimal impact" on us.... one council has even sent us the odd repair request, just not the amount we come to expect.

If the business closes, it will be because of these primary suppliers and their own internal going-ons outwith our control. We have been in contact with them since the Summer, and have consistently been told there is "no issue"...

So..... if it fails -

Can I take them to an industrial tribunal? Sue them for loss of earnings, under an "implied contract"? What might my options be?

Thanks in advance for time and advice!

(ps.... I should maybe also add, that one of these council went through a radical account system change, that messed our invoices around a number of time over the last 2 years.... and really messed our cash flow... I have a letter from the accounts department admitting that they were to blame for non-payment of our invoices, leading to financial problems, and that it was through NO fault of our own.)

To do that you have have to convince the tribunal that you were, in effect, an employee for employment law purposes. Based I what you have posted here I would think that is unlikely.

The test a tribunal would use can be slightly different to HMRC so it is occasionally possible to be an employee for one yet self employed for the other!

Assuming you are not, by default, an employee then the only other option would be anything contained in the contract to supply services you have with the council. However unless that guarantees you a certain amount of work that again seems unlikely.

steampowered

I think the answer is no. I can't see any legal recourse.

There is no such thing as an "implied contract". There are only "implied terms" into existing contracts. Either there is a contract for you to do more work (which could be formed verbally, in writing or by conduct) or there isn't.

If you were instructed to do work on individual jobs, in legal terms you would have an individual contract for each individual job.

You'd only have a contract giving you the right to do future jobs if the council had actually promised to use you for future jobs.

In relation to late payment, you could look into the Late Payment of Commercial Debts (Interest) Act 1998 which provides for compensation to be paid in respect of late payment of invoices, but the boat may have sailed on that one and claiming it wouldn't encourage the councils to use you in future.

I think the only thing you can really do is try to find out who is responsible for engaging suppliers to do the work in your sector, and try to convince that person to use your business.

polgara

Lets be honest, the public sector has had its budgets slashed and this council (and others) may just not be doing these repairs...OR they have found someone else to do it cheaper!

Not exactly the same, but our organisation used to hold meetings in various venues around the district we cover (mostly voluntary sector bodies) but will our cuts this has been curtailed significantly with the impact that a number of these charities are not really financially viable due to their rent costs and are having to lay people off to balance their books. Not nice but thats business.

bap98189

polgara wrote: »

Lets be honest, the public sector has had its budgets slashed and this council (and others) may just not be doing these repairs...OR they have found someone else to do it cheaper!

This strikes me as the most likely option. If you want to find out what has really happened, you need to talk to whoever in the council is responsible for whatever work it is you do. Not the people who you were dealing with before, but whoever is the actual decision maker and knows what is going on.

gingerdad

surely this should be called account development and maybe should be more incontact with your customers.

no you can't take them to a tribunal would suggest you get out and find some new customers before you loose your business all together

Raggie

Nothing to add on the comments above, however you may like to check out "who moved my cheese".

It a book and a video.

https://youtu.be/16hxCB1Dvd4

Google is your friend.

Pennywise

Businesses go bankrupt every day when they lose a major customer. It's one of the risks of being in business and something that you need to factor in to your business plan to ensure you have several channels of business rather than have all your eggs in one basket.

cavework

You need to look at your competitors ..are you on your clients approved contractors list? ...Have you been asked to tender? Do you have a contract ?
Unfortunately there is very little you can do except go out and find new customers ...the fact that you have already provided a good service to the Councils already on your client list should help you to get a foot in the door with new clients.

Kayalana99

Unless you have an agreement in place, such as X amount of work for Y years, or you were hired by them (so in effect you would be taking them to a tribunal because they employed you and you wern't a sole trader but given you also work for others I doubt this is what it is)

I appreciate this was your living, but you are a business and they are your customers. They can cut ties at any time - it's only when you have an actual contract, whether verbal or written that you have a leg to stand on.

By using you repeativly, no where did they agree to conutine to. Sounds like their is no problem as such, but they've found someone cheaper or are doing it inhouse, who knows?

eamon

It is possible that your clients haven't been compliant with EU procurement regulations see https://www.gov.uk/guidance/public-sector-procurement-policy
Not many public sector organisations have the purchasing expertise to comply so they will use a third party that does. And as you are in Scotland you need to read this http://www.scotland-excel.org.uk/ There may be other organisations that do this kind of work as well. In short if they don't know about you and your business then your work stops.