Off-hire, and the charges
that keep running.
Hire runs until the item is off-hired, not until you finish with it. A preventable loss that every contractor recognises and almost nobody has a process for.
Published ·4 min read·Written by Unibuild
Hire charges run until the item is formally off-hired, not until you stop using it. The off-hire reference issued when you make that call is the evidence that you ended the hire on a particular date, and without it you are arguing about a conversation. Kit sitting in a compound on a finished job is the most preventable loss in contracting.
Why the meter keeps running
Nobody is doing anything wrong. That is worth saying at the outset, because the instinct when a large hire invoice arrives is to assume the hire company has behaved badly.
A hire agreement is a contract for the supply of equipment over a period. The period ends when the customer ends it, by off-hiring. Until that happens the equipment is on hire, whether it is being used, standing in a compound, or sitting behind a locked gate on a job that finished six weeks ago. The hire company has no way of knowing you have finished, and no obligation to guess.
The hire did not continue because anybody was careless. It continued because a hire only ends when somebody ends it, and nobody did.
The off-hire reference is the whole thing
When you off-hire an item, the hire company issues a reference or confirmation number against that request. It is the single most important piece of information in this article.
It establishes that you ended the hire, and on what date. Without it, a dispute about six weeks of charges reduces to your recollection of a phone call against their records, and their records are the ones that were written down.
So the rule is short: no off-hire without a reference, and the reference goes on the record against the item and the job rather than into a text message. A photograph of the item on the day it was collected, with the reference noted, closes the question entirely.
Where the process actually fails
Consistently the same four places, and none of them is anybody being careless.
- The job finished but nobody owned the closing down. The gang moves to the next site, the site manager is already somewhere else, and off-hiring is nobody in particular job.
- The person who hired it is not the person who finished with it. The office raised the hire, site finished with the item, and each assumes the other dealt with it.
- Collection was requested but not off-hire. These are different transactions. Asking for a collection is not the same as ending the hire, and on some arrangements charges continue until collection actually happens.
- It was off-hired verbally and nobody kept the reference. The call was made, the charges continued, and there is nothing to point at.
Disputing a charge after the fact
Harder than preventing it, but not hopeless, and worth doing properly rather than angrily.
Establish the date you actually finished with the item, with whatever evidence exists: site diaries, photographs, delivery or collection notes, the date the job completed. Then contact the hire company promptly, and be specific about the date and what you are relying on.
Hire companies deal with this constantly and many will meet you somewhere reasonable, particularly on an ongoing account relationship. What weakens the position is delay, which is why an invoice nobody checked for two months is worse than the same invoice queried on the day it arrived. Which is itself an argument for someone actually reading hire invoices against the job rather than approving them because they look like the last one.
A process that works
Four rules, and they are administrative rather than clever.
- One person owns the off-hire for each item, named at the point of hire rather than decided at the end.
- Off-hire is part of closing a job down, on the same checklist as the final clean and the handover, rather than a thing that happens when somebody remembers.
- Always get and record the reference, against the item and the job.
- Check hire invoices against the job, monthly. This is the control that catches everything the first three missed, and it is the one most firms do not do because hire invoices look routine.
Hired items sit on the same register as owned ones with their hire details against them, moved between sites with a signed note, so the question of what is on hire against which job has an answer rather than an assumption. Because hire is captured as committed cost against the job from the point it is raised rather than when the invoice arrives, an item still accruing on a job that has finished is visible in the cost position rather than in an invoice two months later. What the platform will not do is make the call: off-hiring is a phone call somebody has to make, and the value is in it being obvious who and when.
Where to start, on Monday
List every item currently on hire and, against each, name the job and the person who will off-hire it. Anything on the list where the job has finished is money leaving the account today, and that is usually at least one item.
Then add off-hire to your job completion checklist, if you have one, or write a three-line one if you do not. It is the cheapest control in this whole article and it removes most of the exposure permanently.
The follow-up questions.
The wider question of knowing what you have is in knowing what plant you own and where it is.
Why am I still being charged for plant I have finished with?+
What is an off-hire reference and why does it matter?+
Is requesting collection the same as off-hiring?+
Can I dispute hire charges after the job finished?+
How do I stop this happening again?+
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