New staffing and recruiting companies who have never been involved in a lawsuit might find the idea of litigating unnerving. Especially if they initiate the litigation and the other party comes back with a countersuit. The first thing to remember is it’s normal to feel upset, but do not let the countersuit cause you to lose composure and act rashly.
More often than not, staffing and recruiting businesses experience countersuits because the lawyers of their client state that they are not owed anything and the lawsuit is not viable. In some cases, the client counters with accusations like “The employee stole from us” which is an entirely different scenario but, mostly, lawsuits are frivolous and the counter-claim is being done for the sake of compensating for the client’s counsel fees.
Out of all the companies that we are currently collecting from, only 3countersuits are active. The recipe is simple – we do not encourage our own clients to sue.
This may not be the boldest move, but in our 30 years of staffing and recruiting debt collection experience, we have proven that litigation as the first step can be costly and inconvenient. On the other hand, hiring a collection agency is often enough to make the debtor settle the debt. The difference is that a collection firm serves as an extra layer of pressure on the negotiation without the level of tension that a lawsuit brings. The collection company should be experienced enough to control the situation and, at the same time, the creditor (who is the staffing or recruiting firm) should let the agency communicate on their behalf completely.
As an added preventive measure, we encourage that a staffing company includes the sentence, “The parties agree that any litigation arising from this extension of credit shall be conducted in __________ County, Georgia, which shall have exclusive jurisdiction over any such legal proceedings,” to its credit application. This specific sentence is relevant because it forces an out-of-state debtor to spend their time and money, resulting in settling rather than litigating a disputed matter.
Lawsuits are expensive, time-consuming, and stressful. Hence, we encourage creditors to seek advice from professional collection companies before deciding to proceed with litigation.
You can book a FREE one-on-one consultation with Adams, Evens, and Ross’ CEO and Founder, Wilson Cole. Wilson has spent three decades helping staffing and recruiting companies collect past-due debts and, as a service to the industry, AER stands by its No Collection, No Fee policy.
Call us at 800-452-5287 or email us at email@example.com.