Code Criteria
The Fair Payment Code The Fair Payment Code has a tiered system of Awards which is aimed at awarding best practice and driving improvements in payment performance.
The Code has three Award tiers which businesses can apply for, each with their own criteria which is evidenced during the application process:
- Gold Award – To pay at least 95% of all invoices within 30 days.
- Silver Award – To pay at least 95% of all invoices within 60 days, including at least 95% of invoices to small businesses (with fewer than 50 employees) within 30 days.
- Bronze Award – To pay at least 95% of all invoices within 60 days.
In addition, every applicant to the Code agrees to abide by the Code’s principles of being Clear, Fair and Collaborative with their suppliers.
Be Clear
- Establish clear and fair payment terms, ensuring their suppliers understand the payment terms laid out in their contracts.
- Agree payment terms with suppliers and put them in writing, before work begins, in clear plain English contracts.
- Ensure they communicate promptly with suppliers where payment may be delayed or outside of agreed terms.
Be Fair
- Always endeavour to pay suppliers a) within the terms of the Code and b) in a reasonable, mutually negotiated and agreed timeframe, avoiding delays wherever possible.
- Where delayed payment of invoices causes damage to a supplier’s business, signatories will accept consequences such as automatically applied late payment interest and compensation as detailed in The Late Payment of Commercial Debts Act 1998.
- Aim to avoid disputes and where these can’t be avoided pay undisputed portions of invoices within terms and resolve the disputed portions within the agreed timeframe.
Be Collaborative
- Proactively work to avoid conflict and to facilitate early resolution of potential disputes.
- Recognise the importance of embedding conflict avoidance mechanisms in contract management and projects.
- Work to share best practice, encourage, and promote fair payment across your industry or more generally.
For more information on how the criteria is evidenced through your application please see our Guidance.
Businesses can apply for any level of Award so long as they can provide evidence that they meet the Award criteria. Where applicants do not meet the criteria, they will automatically be considered for a lower category should they meet those criteria or alternatively can be provided with an action plan to support them to attain their desired level.
There are no charges associated with being part of the Fair Payment Code.
If you have any questions about the Code, please see our FAQs or get in touch with the FPC Team.