Delays in payment for contract staffing work can be a significant challenge for companies. To address this issue, a Recovery System for Company Funds has been developed, consisting of three phases. Each phase plays a crucial role in recovering funds owed to the company.
Key Takeaways
- The Recovery System for Company Funds consists of three phases: Phase One, Phase Two, and Phase Three.
- Phase One involves sending letters to debtors, skip-tracing, and attempting to contact debtors for resolution within 30 to 60 days.
- Phase Two includes forwarding cases to affiliated attorneys for legal action and demanding payment from debtors.
- Phase Three offers recommendations for either closing the case or proceeding with litigation, with associated legal costs and collection rates.
- DCI provides competitive collection rates based on the number of claims submitted and the age of the accounts.
Recovery System for Company Funds
Phase One
Upon initiating Phase One, swift action is taken to signal the urgency of the situation to the debtor. Within 24 hours of account placement, a multi-channel communication strategy is deployed:
- A series of four letters is dispatched via US Mail.
- Comprehensive skip-tracing and investigation are conducted to secure optimal financial and contact data.
- Persistent contact attempts are made through phone, email, text, and fax.
The goal is to establish a resolution swiftly, with daily contact efforts spanning the first 30 to 60 days. Should these efforts not yield a resolution, the process seamlessly transitions to Phase Two, involving our network of affiliated attorneys.
The effectiveness of Phase One hinges on the immediacy of these actions, setting the tone for the debtor that resolution is non-negotiable.
Phase Two
Upon escalation to Phase Two, the case is transferred to a local attorney within our network. This shift signifies a more formal approach to debt recovery. The attorney’s immediate actions include:
- Drafting and sending a series of authoritative letters on law firm letterhead.
- Initiating direct telephone contact with the debtor to demand payment.
This phase intensifies the pressure on the debtor, signaling the seriousness of the situation.
If these measures do not yield results, a detailed report is prepared for the client. This report outlines the challenges encountered and provides a clear recommendation for the subsequent phase. The decision to proceed further rests with the client, ensuring transparency and control remain paramount.
Phase Three
Upon reaching Phase Three, the path forward becomes clear. If the likelihood of fund recovery is low, we advise case closure, sparing you further costs. Conversely, should litigation be the recommended route, a decision point arises.
Litigation entails upfront legal fees, typically between $600 to $700, which cover court costs and filing fees. These expenses are necessary for our affiliated attorney to initiate legal proceedings on your behalf.
The goal is to recover all monies owed, including litigation costs. However, if litigation does not yield results, you owe nothing further.
Our fee structure is straightforward and competitive, with rates varying based on claim age, amount, and volume. Here’s a quick breakdown:
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For 1-9 claims:
- Under 1 year: 30%
- Over 1 year: 40%
- Under $1000: 50%
- With attorney: 50%
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For 10+ claims:
- Under 1 year: 27%
- Over 1 year: 35%
- Under $1000: 40%
- With attorney: 50%
This tiered approach ensures that our services are tailored to your specific needs, providing a fair and effective resolution.
Frequently Asked Questions
What is the Recovery System for Company Funds?
The Recovery System for Company Funds consists of three phases: Phase One involves sending letters to debtors, skip-tracing, and attempting to contact debtors. Phase Two includes forwarding the case to an affiliated attorney for legal action. Phase Three involves either closing the case if recovery is unlikely or proceeding with litigation.
What happens if recovery is not likely in Phase Three?
If recovery is not likely in Phase Three, the case may be recommended for closure, and you will not owe anything to the firm or affiliated attorney. Alternatively, litigation may be recommended, and you can choose to proceed with legal action by paying upfront legal costs.
What are the rates for the Recovery System?
The rates for the Recovery System vary based on the number of claims and the age of the accounts. Rates range from 27% to 50% of the amount collected, depending on the specific conditions of the accounts.
What actions are taken in Phase One of the Recovery System?
In Phase One, letters are sent to debtors, skip-tracing is conducted, and attempts are made to contact debtors via various methods such as phone calls, emails, and faxes. Daily attempts are made to contact debtors for the first 30 to 60 days.
What happens in Phase Two of the Recovery System?
In Phase Two, the case is forwarded to a local attorney who sends letters to the debtor demanding payment. The attorney also attempts to contact the debtor by phone. If all attempts to resolve the account fail, further recommendations are provided.
What are the upfront legal costs in Phase Three if litigation is chosen?
If litigation is chosen in Phase Three, upfront legal costs such as court fees and filing fees ranging from $600.00 to $700.00 are required. These costs cover the filing of a lawsuit on behalf of the client.
