Penalty clause. Is it normal?
Thread poster: Rad Graban

Rad Graban  Identity Verified
United Kingdom
Local time: 07:23
English to Slovak
+ ...
Nov 3, 2009

Hi all,

Is such a penalty clause usual/normal in the interpreting contracts? I really don't feel comfortable with it as it does not specify what is a "reasonable explanation".

"As per para 7.3, should you arrive late or fail to attend the assignment without a reasonable explanation, TT shall be entitled to claim an administration fee of £50.00 or recover losses incurred (plus VAT at 15.00%), whichever is greater, from you."

Thanks for any input.

Rad


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Stanislaw Czech, MCIL  Identity Verified
United Kingdom
Local time: 07:23
Member (2006)
English to Polish
+ ...
I would not be bothered by "reasonable explanation" Nov 3, 2009

as it is quite fair. However I would be worried by responsibility for losses what in fact means that your responsibility is unlimited. Let's say that the los is a fact that they lost a client worth to them $434456464/year......

I am not against some kind of penalty clauses but most likely I would not undertake a job where my losses may be greater than possible gains.

Best Regards
Stanislaw


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inmb  Identity Verified
Local time: 08:23
English to Polish
+ ...
VAT on losses? Nov 3, 2009

I just wonder why they charge VAT on losses incurred?

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eronima kirileanu
United States
Local time: 02:23
Romanian to English
+ ...
cancellation policy Nov 5, 2009

Is there a mention what do you get if the client cancels the job in less than 24 hrs.? If it is a legal interpreting (court, deposition, arbitration) you should be paid the full amount (2-3 hrs minimum) if they cancel in less than 24 hrs.
penalties should go both ways not only one-way.
My 2 cents.


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Derek Gill Franßen  Identity Verified
Germany
Local time: 08:23
German to English
+ ...
Some questions to ask yourself... Nov 5, 2009

When is an explanation reasonable (and who decides)?

Do you think it is fair to pay a flat-fee of £50.00 for being late, even if the tardiness has no effect on the agency at all (let's assume, for example, that they happen to have an additional on-site interpreter, who is willing to do the job for the exact same price that you would have done it and is available immediately)?

Are you comfortable with the possibility of unlimited liability (let's assume, for example, that they need to hire an additional interpreter to cover for you and the only person available is able to charge 10x the "normal" rate because the agency needs a replacement so badly)?


I'm not sure how I would answer those questions in this particular instance. But if I had to answer them, I would want to see how the agency's ideas differ from what would happen by default, if neither party had negotiated anything for the case of late delivery, i.e., I would want to know what the applicable laws provide for in such cases.

I don't remember the German law saying anything about a flat-fee in the case of late delivery and, assuming that German law does not apply to you, I doubt other legal systems have such a rule either, but I can't know for sure.

That obviously doesn't mean that the parties to a contract are bound to follow the "default rule," and they are welcome to negotiate most terms (as much to their own advantage as possible), but there may also be a reason why the legislature has not added such a fee (if, indeed, they haven't), and perhaps it is because the lawmakers have decided that the existing rules are fair enough... and that might be a good starting point for negotiations.

Good luck!


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Alexandra Goldburt
Local time: 23:23
English to Russian
+ ...
Please understand the agency's point of view Nov 6, 2009

I know many agency owners personally, and I know from my numerous conversation with them that interpreter's tardiness is a serious problem indeed. Understand that the agency in question can loose a client because of your tardiness or, worse yet, a no-show. Not just that particular job, but all future jobs from that client. Come think about it, it's a huge loss!

I have never signed a contract with a "penalty" clause, but I made it a point to act as if I did. I promise my clients that, barring truly extraordinary circumstances, I'll be on time, period. By "truly extraordinary circumstances" I mean death (my own or a close family member), serious and sudden illness or injury, or (this is a very Los Angeles thing) such an accident that blocks freeways for hours. And I don't mean simply "bad traffic" - which is an every day occurrence in Los Angeles, but really bad cases where an accident just blocks a freeway and you are unable to either get off it or move on. Mercifully, this doesn't happen often.

I also exclude from my promise to be on time all last minute assignments (such as, a phone call asking if I can go to XXX RIGHT NOW?) - for obvious reasons.

On the other hand, I agree with Eronima. Yes, it has to go both ways. If they booked you and then canceled, it might result in you loosing another assignment, so to ask to be paid full fee in case the assignment is canceled in less then 24 hours is only fair. If such a clause is not in the contract, ask for it to be added.


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Penalty clause. Is it normal?

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