Spotting the early symptoms of employer Insolvency

1. •

   most importantly, a contractor needs to keep alert to the employer's financial status

2. •

   the contractor should take heed of ongoing rumours about the employer's financial position (either in the press or by word of mouth)

3. •

   look out for official announcements to shareholders/the Stock market (for example, profit warnings)

4. •

   note any surprising or uncommercial omissions from the project made by the employer

5. •

   keep aware of the employer's non-payment or late payment of other parties on this project, or on other projects being carried out by the employer

6. •

   clearly, if the employer suspends work on the scheme without any adequate explanation or without commercial rationale, this may be a sign that the employer is unwilling to finance further work

7. •

   confirm suspicions by carrying out a Dun & Bradstreet search/report, which should disclose, for example, any unsatisfied court judgments against the employer

If the employer is insolvent, see Checklist: Contractor steps to take if employer becomes insolvent—checklist.

Contractor methods of protecting itself