Denying payments as a project deadline penalty

Question

I've just had a bad project experience. I was a subcontract programmer of a subcontract software house. I've been assigned as a single developer to build an application.

During the development process, I suffered a rather severe illness which greatly decrease my ability to complete the project. My team leaders knew this condition very well since they visited me several times.

Despite the above condition, my team leaders didn't come with any solutions such as providing assistant programmer nor replace me with another programmer. Instead they keep pushed me to finish the job. The job was completed; however it was a few months late behind the deadline.

Now that the job was done, I had difficulties in getting my fee. It appears that my leaders blame me for the late completion. Yet, they still use my application as it is now online.

My questions:

1. What are common penalties for exceeding project deadlines?
2. What are your opinion about my case? Do I still had a chance to claim my fee?

Answer 1

Penalties and awards attached to fees MUST be clearly indicated in your contract. There is nothing common about this. It is simply an agreement between two parties as to how they wish to incent performance.

If your contract does not stipulate such an incentive, then you are owed your fee so long as you met all the applicable Ts&Cs. Their claim to your fee must be tied to damages, which they would have trouble proving since they are using your work. Being "late" would not likely meet the standard of damages, though they could try.

You should engage an attorney and get some advice on this. The likelihood of winning compared to the cost of pursuit needs to be analyzed and considered. But your side of the story sounds like you have some good issues to pursue.

Answer 2

Quick answers to your specific questions -

What are the common penalties? ONLY what's written into the contract BEFORE you start work. Unless there are specific penalties or clauses in the agreement, they have no basis for withholding your fee. Even if you did cause them to incur some fees or lose revenue, it's incumbent on THEM to protect themselves beforehand.

Do you have a chance to reclaim your fee? Absolutely!! Unless they can show where in your agreement you were BOUND to a completion date under penalty of loss or forfeiture, they owe you the money. Additionally, the fact that they're using your application says they found value in it, even if delayed, so they owe you.

One added thought - this scenario falls under the category of proper Change Management. Even if penalties or delays aren't specifically spelled out in your contract, it's ALWAYS in your best interest to communicate changes (in both schedule and cost) in writing, so there's no misunderstanding. When you get sick, send them a quick note letting them know that there will be a delay. That way you have written proof that you gave them notice "prior to" the delay.

Answer 3

Try escalating it to their boss.

As David mentioned, this is not common "business" practice. However, it doesn't sound like there is much legal recourse. I would try making your case with someone higher up in the company or someone who knows them and may have some influence on their decision making.

Answer 4

My personal opinion is that you are due ALL fees, unless there was a written contractual agreement describing late conditions.

But I also think if you could prove the following two conditions, that you would have a pretty damn great case:

1. While being aware of your condition, and as a result the project state, they have not communicated any concern, warning or discontent, and
2. Like you stated, instead they kept pushing you to finish the job (which to me is 'business as usual')

Then the law would more than likely be on your side.

Also note that depending on your jurisdiction and monies due, you could take them to small claims court (if inferior to $6K), for which they would have to present themselves as individuals and their lawyers would not be allowed in the court room. In Canada, you'd be surprised on how many companies are scared of this and just settle right away. There is almost no cost to the individual.