Recruitment agencies get paid late mostly because of how the work is billed and who the clients are. Perm fees are large one-off invoices that can stall in a client's approval process, larger hirers set long payment terms, some clients wait on their own funding, and agencies are often reluctant to chase a client who might send the next role.
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The short version
- Perm fees are large one-off invoices that often need extra client approval.
- Larger hirers set long terms, and the REC has reported demands of up to 120 days.
- Some clients, such as publicly funded care providers, pay when their own money arrives.
- Agencies often hold back from chasing clients who might send the next role.
- Agreeing terms and payment method at signing and chasing consistently ease the pressure.
Large one-off fees and client approvals
A perm fee is usually a percentage of the candidate's first-year salary, and published agency terms range from about 15% to 30%. On a £30,000 salary at 20%, that's a £6,000 invoice for a client who may not have bought anything from you for months.
An invoice that size often needs more than one signature. It may need a purchase order the hiring manager never raised, or sign-off from a finance director who wasn't part of the hire. It's also usually raised on the candidate's start date, when the hiring manager's attention has moved to onboarding, so the invoice can sit in an inbox while everyone assumes someone else is dealing with it.
That leaves you deciding when to raise the payment question. Some agencies agree the purchase order, the invoice contact and the payment method when the offer is accepted, before the fee is due. That conversation can feel awkward mid-placement, but it's usually easier than finding out three weeks after the due date that the invoice was never approved.
Long terms set by larger clients
Large clients often set their own supplier terms, and an agency trying to win the account has limited room to push back. The REC has said that hirers have demanded payment terms of up to 120 days from suppliers of agency workers, who are usually paid by the agency the same week.
Accepting long terms can win you the client but leave you funding their payroll for months. Holding out for 30 days may cost you the account. Between businesses, agreed terms over 60 days can be cut back unless they're not grossly unfair to the supplier, though few agencies would raise that with a client they want to keep. The government's Commercial Payments Bill would cap payment terms at 60 days for large buyers and make late payment interest mandatory. It's still going through Parliament and isn't yet law.
Long terms are one reason temp agencies turn to invoice finance. Factoring lets an agency accept 60 or 90 days without running out of cash, but it also makes those terms easier to agree to, and the cost of every extra day falls on the agency.
Clients who are waiting on their own money
Some clients pay late because they're paid late. A care provider funded by a local authority, or a business waiting on its own customers, often pays suppliers when its own money arrives, whatever the invoice says. Chasing harder rarely moves their payment date, though asking when their funding lands tells you when to expect yours.
With these clients, the choice is often between agreeing a realistic date and holding to your terms. Some agencies agree a date in writing, or move a weekly temp client onto direct debit so each invoice is collected on its due date without a reminder. Others price the longer wait into their margin.
The reluctance to chase
Recruitment is a relationship business, and the client who owes you a fee may also be your best source of new roles. Founders often hold back from chasing for exactly that reason. Many agencies are small, too, and the time spent matching bank transfers and sending reminders tends to come out of the same day as filling roles.
REC member data in its 2024/25 status report shows 35% of recruitment firms had bad debt in the past year, against 29% across sectors. Among invoices paid to recruitment agencies using Adfin in 2025 and 2026, the typical invoice was paid about 9 days after its due date. That comes from an early, small set of agencies, with a few businesses making up much of it, so it's directional and not a benchmark.
Most of these causes can be worked on before an invoice goes late. Agreeing terms, a payment method and an invoice contact at signing, collecting from weekly clients by direct debit and sending reminders before the due date all take some of the pressure off chasing. If you'd rather not do the chasing by hand, Adfin sends reminders by email, SMS and WhatsApp with a payment link in each one. Its AI Customer Agents work within rules you approve, and reminders can be paused for any client you're handling personally.
Common questions
How long do recruitment agencies usually wait to be paid? There's no current published survey of recruitment debtor days. Across UK small businesses, Xero's data shows an average of 29.1 days to be paid, 8.3 days late, though that isn't specific to recruitment.
Why do clients take longer to pay perm fees than other invoices? Perm fees are large one-off invoices, so they often need extra approval, a purchase order or a finance director's sign-off before they're paid.
Can a client insist on 90-day payment terms? A client can ask for any terms you agree to. Between businesses, agreed terms over 60 days can be cut back unless they're not grossly unfair to the supplier.
Is the government capping payment terms? The Commercial Payments Bill would cap terms at 60 days for large buyers, but it's still going through Parliament and isn't law yet.
Do temp agencies get paid later than perm agencies? Temp invoices are smaller and more frequent, and some large hirers demand long terms from suppliers of agency workers. Either model can see long delays depending on the client.
What can a recruitment agency do about late-paying clients? Agree payment terms and a method at signing, collect from repeat clients by direct debit, remind before the due date, and add statutory late payment interest where it makes sense.
Sources
- REC - Recruitment Industry Status Report 2024/25 (accurate as of October 2026) https://www.rec.uk.com/our-view/research/recruitment-and-industry-status-report/uk-recruitment-industry-status-report-202425
- REC - REC responds to new package on late payments (accurate as of October 2026) https://rec.uk.com/our-view/news/press-releases/rec-responds-new-package-late-payments
- UK Parliament - Commercial Payments Bill [HL]: Stages (accurate as of October 2026) https://bills.parliament.uk/bills/4128/stages
- Xero - United Kingdom Small Business Insights (accurate as of October 2026) https://www.xero.com/resources/small-business-insights/latest-united-kingdom
