Recruitment body backs late payment crackdown

With late payments being a long-standing issue for many small businesses, the government’s latest consultation has been very much welcomed.

The late payment consultation closed on the 23^rd of October 2025 and was a public review on proposed legislative measures to tackle poor payment issues.

Late payment consultation

The government’s key proposals from ‘Late payments consultation: tackling poor payment practices’ included:

• Payment term limits – a cap of 60 days on payment terms, with a potential reduction to 45 days.
• Mandatory payment reviews – large companies are required to review payment data.
• A fixed deadline for disputing invoices.
• Statutory interest on late payments.
• Penalties for repeat offenders – those who persistently pay late will face financial repercussions.
• Expanded powers for the Small Business Commissioner – enabling them to impose fines and carry out spot checks.

Professional recruitment sector responds

Commenting on the consultation, Tania Bowers, Global Public Policy Director at APSCo, said, “We are pleased to see the Government taking meaningful steps to address the persistent issue of late payments. Our members have long reported the strain caused by extended payment terms, especially when they are required to pay contractors within days while waiting months for reimbursement from end clients. These proposals reflect many of the changes we’ve called for, and we’re encouraged by the direction of travel.”

“We particularly welcome the move to separate disputed invoices from standard payment reporting, and the emphasis on greater transparency in director reports. However, we continue to urge the Government to ensure that complex billing processes and ‘pay when paid’ terms are also addressed, as these pose significant risks to supply chain stability.”

“APSCo has reiterated its call for further clarity around payment terms in supply chain finance in its submission to the latest consultation. We believe that robust regulation and accurate reporting are essential to safeguarding the financial health of SME recruitment businesses and ensuring fair treatment across the staffing supply chain.”

To find out more about contracting, please contact Jaime on 01442 795 100 or email jaime.thorpe@dolanaccountancy.com.