Potential theft by freelance staff - what can we do?

EOTS

I run a small company - there are 3 of us and we all have other jobs to supplement our income.

We got a contract for selling merchandise at a festival and had the operation managed by a freelancer working on our behalf. Since July the festival have been withholding payment as there are discrepancies.

The festival are claiming that she gave back less cash and took more float than she has said. The main issue is that all of her reconciliation sheets are a mess and different figures each time. She has also been nearly impossible to make contact with - either ignoring us or making excuses.

We are down by a lot of money as a result of this (she was paid by us before this all came to light so no motivation for her there) and it now looks like the only explanation is that the money has been stolen.

How would we go about speaking to the police etc? Any help would be hugely appreciated. We're a small company and can't really afford big legal fees etc

Comms69

EOTS wrote: »

I run a small company - there are 3 of us and we all have other jobs to supplement our income.

We got a contract for selling merchandise at a festival and had the operation managed by a freelancer working on our behalf. Since July the festival have been withholding payment as there are discrepancies. - How much have they paid?

The festival are claiming that she gave back less cash and took more float than she has said. The main issue is that all of her reconciliation sheets are a mess and different figures each time. She has also been nearly impossible to make contact with - either ignoring us or making excuses.

We are down by a lot of money as a result of this (she was paid by us before this all came to light so no motivation for her there) and it now looks like the only explanation is that the money has been stolen. - How much money?

How would we go about speaking to the police etc? Any help would be hugely appreciated. We're a small company and can't really afford big legal fees etc

I would suggest that the festival would be reporting the theft and not you.

EOTS

Unfortunately they are a large international company and they are withholding payment from us so they are currently not out of pocket. Are they legally entitled to do this?

Obviously this complicates things significantly!

Comms69

EOTS wrote: »

Unfortunately they are a large international company and they are withholding payment from us so they are currently not out of pocket. Are they legally entitled to do this?

Obviously this complicates things significantly!

Well you need to take them to court.


Yes they can do this. They are doing it.

lincroft1710

Look at your contract with them. Is there a clause which says payment may be withheld if the service provided is not acceptable or there has been any failure in accounting procedures or similar wording.

As you are a company then business to business rules apply

EOTS

Frustratingly there was no contract with them. In terms of paper trail there is an agreement to undertake the work (done via email by one of the other directors), a PO and an invoice.

At no point was it mentioned that there would be money withheld based on accounting discrepancies etc but understand that we're not in the best position because we (foolishly) didn't put a contract or terms & conditions in place (this is something we now do)

lincroft1710

If the freelancer was supplied by you and you invoiced the company for the cost of her services, then the company may say that as she appeared to be dishonest and cost them money, they should pay the invoice less the money they have lost by her actions.

If you did sue the company, there is no doubt this is what they would use as a reason for not paying your invoice (or only partially not paying). I do not know how a court would view the company's reasoning

spadoosh

EOTS wrote: »

Frustratingly there was no contract with them. In terms of paper trail there is an agreement to undertake the work (done via email by one of the other directors), a PO and an invoice.

At no point was it mentioned that there would be money withheld based on accounting discrepancies etc but understand that we're not in the best position because we (foolishly) didn't put a contract or terms & conditions in place (this is something we now do)

You do have a contract, its an implied contract. Communication between you, invoices, photos of th event will all act as evidence of a contract being in place. It doesnt have to be written down.

You need to basically start court proceeding aginst the company you invoiced. Im assuming they are withholding all the payments and the discrepancy is less than the total invoice? They need to be paying something, theyre not because youre allowing them not to. Find otu the process of taking them to court. Hopefully theyll settle at the first hint of court as to avoid the hassle but you should also make sure youve got a good case should it go that far.