My question involves independent contractors in the state of: Massachusetts.
I am an IT consultant organized as S-Corp. I do not have a direct relationship with the client.
Instead, the client has a relationship with a stuffing/consulting company (let's call it ABC LLC), and my corp is a sub-contractor.
My contact with ABC is for $X/hr. They bill the client for $X+Y/hr and once they get the client payment, they pay my invoice for $X/hr.
ABC's invoices to the client are specifically for my services, presented as hourly labor.
Lately there has been organizational turmoil at ABC, and ever since my invoices are paid late. Currently they owe me $35K+.
Not long ago the principal at ABC assured me that the client is timely, the problem is with the ABC staff and will be fixed.
The issues however persist. Last invoice was paid late and partially, with the promise to pay the rest later.
I am concerned that ABC is in financial trouble and may be using client payments for my services for something other than my invoices.
How can I protect myself in this situation?
Is ABC obligated to pass to me client's payments?
Do personal assurances from the principal carry any legal weight?
Thanks
-Art