EMPLOYMENT AGREEMENT


               This  Agreement  is made as of the  14th day of  September,  1998
between Outsourcing Solutions Inc., a Delaware corporation,  with offices at 390
South Woods Mill Road, Suite 350, Chesterfield,  Missouri 63017 (the "Company"),
and C. Bradford  McLeod,  an  individual  residing in the State of Missouri (the
"Employee").

                                    RECITALS

               WHEREAS,   the  Company   desires  to  secure  the  services  and
employment of the Employee on behalf of the Company, and the Employee desires to
enter  into  employment  with  the  Company,   upon  the  terms  and  conditions
hereinafter set forth.

               NOW,  THEREFORE,  in  consideration  of the mutual  covenants and
promises  contained  herein,  the parties  hereto,  each intending to be legally
bound hereby, agree as follows:

               1. Employment.  The Company hereby employs the Employee as Senior
Vice  President--Human  Resources of the Company,  and the Employee accepts such
employment for the term of the employment  specified in Section 3 below.  During
the Employment Term (as defined  below),  the Employee shall serve as the Senior
Vice President--Human Resources of the Company,  performing such duties as shall
be reasonably  required of such an employee of the Company,  and shall have such
other powers and perform such other additional executive duties as may from time
to time be  assigned  to him by the  Board  of  Directors  of the  Company.  The
Employee's primary place of employment shall be St. Louis, Missouri.

               2.  Performance.  The Employee will serve the Company  faithfully
and to the best of his ability and will  devote  substantially  all of his time,
energy,  experience and talents  during regular  business hours and as otherwise
reasonably necessary to such employment,  to the exclusion of all other business
activities.

               3.  Employment  Term. The employment term shall begin on the date
of  this  Agreement  and  continue  until  December  31,  1999,  unless  earlier
terminated pursuant to Section 7 below (the "Employment Term");  provided,  that
on December 31, 1999 and on each  anniversary  thereafter,  the Employment  Term
shall be automatically  extended for an additional twelve month period unless 30
days prior to such  anniversary  date either the Company or the  Employee  shall
give written notice of termination of the Agreement, in which case the Agreement
will terminate at the end of the then existing Employment Term.

               4. Compensation.

               (a) Salary. During the Employment Term, the Company shall pay the
Employee a base salary,  payable in equal semimonthly  installments,  subject to
withholding and other applicable taxes, at an annual rate of One Hundred Seventy
Five Thousand Dollars ($175,000.00).

               (b) Bonus.  The Company  shall pay the Employee a signing  bonus,
subject to withholding and other  applicable  taxes,  of $70,000,  payable on or
before  September  15,  1998.  For the  period  commencing  on the  date of this
Agreement and ending on December 31, 1998, the Employee shall be eligible for an
annual bonus of up to 50% of his base  salary,  pro rated to reflect the partial
year, on or before March 15, 1999.  Commencing on January 1, 1999,  the Employee
shall be eligible for an annual  bonus of up to 50% of his base  salary.  Annual
bonuses shall be based on the satisfaction of performance targets established by
the  Board of  Directors  on or  before  December  31 of each  year for the next
succeeding year.

               (c)  Medical and Dental  Health,  Life and  Disability  Insurance
Benefits.  During the Employment Term, the Employee shall be entitled to medical
and  dental  health,  life  insurance  and  disability   insurance  benefits  in
accordance  with the  Company's  established  practices  with respect to its key
employees.

               (d)  Vacation;  Sick  Leave.  During  the  Employment  Term,  the
Employee  shall be entitled to vacation  and sick leave in  accordance  with the
Company's established practices with respect to its key employees.

               5. Expenses.

               (a) The  Employee  shall be  reimbursed  by the  Company  for all
reasonable  expenses  incurred by him in connection  with the performance of his
duties hereunder in accordance with policies  established by the Board from time
to time and upon receipt of appropriate documentation.

               (b) The Employee  shall be  reimbursed  by the Company for normal
moving and relocation expenses incurred by Employee to move his residence to the
St. Louis  metropolitan  area,  including  reasonable  and customary real estate
commission,  closing  costs and  discount  points and  reasonable  expenses  for
temporary  living,  return home travel and family  travel to St. Louis for house
purchasing  purposes.  Company shall  reimburse  Employee an amount equal to any
loss sustained by him on the sale of his current  residence,  up to $50,000.  If
requested  by  Employee,  Company  shall  provide  an  advance  of  $225,000  to
facilitate Employee's  relocation,  to be repaid to the Company no later than 48
hours following the closing of the sale of Employee's  current  residence in Oak
Hill, Virginia.  Company shall reimburse Employee for duplicate housing expenses
for up to six  months  following  the  closing  of the  purchase  of  Employee's
residence in the St. Louis metropolitan area.  Employee shall receive a lump sum
payment in an amount sufficient to reimburse him for income taxes payable by him
as a result of such moving and  relocation  expenses  and the  payment  received
under this Section 5(b).

               6.  Secret  Processes  and  Confidential  Information.   For  the
Employment Term and thereafter,  (a) the Employee will not divulge,  transmit or
otherwise disclose (except as legally compelled by court order, and then only to
the extent  required,  after  prompt  notice to the Company of any such  order),
directly or indirectly,  other than in the regular and proper course of business
of the Company,  any  confidential  knowledge or information with respect to the
operations or finances of the Company or with respect to  confidential or secret
processes, services, techniques,  customers or plans with respect to the Company
and (b) the Employee  will not use,  directly or  indirectly,  any  confidential
information for the benefit of anyone other than the Company; provided, however,
that the Employee has no obligation,  express or implied,  to refrain from using
or disclosing to others any such knowledge or information  which is or hereafter
shall  become  available  to the public  other than  through  disclosure  by the
Employee. All new processes,  techniques, know-how, inventions, plans, products,
patents and devices developed,  made or invented by the Employee,  alone or with
others, while an employee of the Company,  shall be and become the sole property
of the  Company,  unless  released in writing by the  Company,  and the Employee
hereby assigns any and all rights therein or thereto to the Company.

               During the term of this Agreement and thereafter,  Employee shall
not take any action to disparage  or  criticize to any third  parties any of the
services  of the Company or to commit any other  action that  injures or hinders
the business relationships of the Company.

               During the term of this Agreement and thereafter,  Employee shall
not employ, solicit for employment or otherwise contract for the services of any
employee of the Company or any of its  Affiliates (as defined below) at the time
of this Agreement or who shall subsequently become an employee of the Company or
any of its Affiliates,  provided that Employee shall not be prohibited from such
solicitation  or  employment if such  employee (a)  initiated  discussions  with
Employee  without  any  direct  or  indirect  solicitation  from  Employee,  (b)
responded to a general public  solicitation,  or (c) has  terminated  employment
with the Company prior to commencement of discussions with Employee.

               All  files,  records,  documents,  memorandums,  notes  or  other
documents  relating to the business of Company,  whether prepared by Employee or
otherwise  coming into his  possession in the course of the  performance  of his
services under this  Agreement,  shall be the exclusive  property of Company and
shall be delivered to Company and not retained by Employee upon  termination  of
this Agreement for any reason whatsoever.

               7. Termination.  The employment of the Employee  hereunder may be
terminated at any time by the Company with or without  "cause".  For purposes of
this  Agreement,   "cause"  shall  mean:  (i)   embezzlement,   theft  or  other
misappropriation of any property of the Company or any subsidiary, (ii) gross or
willful  misconduct  resulting  in  substantial  loss  to  the  Company  or  any
subsidiary  or  substantial  damage  to the  reputation  of the  Company  or any
subsidiary,  (iii)  any  act  involving  moral  turpitude  which  results  in  a
conviction for a felony involving moral turpitude,  fraud or  misrepresentation,
(iv) gross neglect of his assigned duties to the Company or any subsidiary,  (v)
gross breach of his fiduciary  obligations to the Company or any subsidiary,  or
(vi) any chemical  dependence  which  materially  affects the performance of his
duties and  responsibilities to the Company or any subsidiary;  provided that in
the case of the  misconduct  set  forth in  clauses  (iv) and (vi)  above,  such
misconduct  shall  continue  for a period of 30 days  following  written  notice
thereof by the Company to the Employee.

               8.  Severance.

               (a) If Employee's employment is terminated by the Company without
"cause,"  the  Company  does not agree to extend  the  Employment  Term upon the
expiration  thereof,  or Employee  terminates his employment because the Company
reduces his  responsibilities or compensation in a manner which is tantamount to
termination of Employee's employment,  Employee shall be entitled to (i) receive
an  amount  equal to his base  salary  for the  year  preceding  the date of the
Employee's  termination or the date on which the Employment Term expires, as the
case may be, such amount to be payable,  at the Company's  option, in a lump sum
on the date of termination or the date on which the Employment Term expires,  as
the case may be,  or  ratably  over the one year  period  following  the date of
termination or expiration (the "Severance Period"), (ii) continue to receive the
medical  and dental  health  benefits  referred  to in Section  4(c)  during the
Severance  Period,  and  (iii)  reasonable   outplacement  services  during  the
Severance  Period  provided by an  outplacement  firm  designated  by  Employee;
provided,  however,  if any such  event  occurs  prior to the  extension  of the
initial Employment Term, Employee shall be entitled to (i) $175,000, payable, in
a lump sum on the date of termination,  (ii) continue to receive the medical and
dental health benefits  referred to in Section 4(c) during the Severance Period,
and (iii) reasonable  outplacement services during the Severance Period provided
by an outplacement firm designated by Employee.

               (b) If,  prior  to  September  14,  2000,  there is a Sale of the
Business  (as defined in Section 2.4 of the  Amended and  Restated  Stockholders
Agreement  dated as of  February  16,  1996 by and among the Company and various
stockholders  of the  Company)  or Timothy  G.  Beffa no longer  serves as Chief
Executive  Officer of the Company,  then  Employee  may elect to  terminate  his
employment  with the Company and he shall be entitled to the severance set forth
in Section 8(a) and relocation  assistance to the Washington  D.C.  metropolitan
area, equivalent to the assistance set forth in Section 5(b); provided, however,
Employee may elect to relocate to an area other than  Washington  D.C., in which
case such  assistance  shall be no greater than the  assistance  that would have
been provided to relocate Employee to Washington D.C.

               (c) If the  Employee's  employment  is  terminated by the Company
"for cause", the Employee shall not be entitled to severance compensation.

               (d) The Employee  covenants  and agrees that he will not,  during
the one year period  following the  termination of the Employee's  employment by
the Company,  within any  jurisdiction or marketing area in which the Company or
any of its Affiliates (as defined  below)is doing business or is qualified to do
business,  directly or indirectly own, manage, operate,  control, be employed by
or  participate  in the  ownership,  management,  operation or control of, or be
connected in any manner with, any business of the type and character  engaged in
and  competitive  with that conducted by the Company or any of its Affiliates at
the time of such termination; provided, however, that ownership of securities of
2% or  less  of any  class  of  securities  of a  public  company  shall  not be
considered to be competition with the Company or any of its Affiliates.  For the
purposes of this Section 8, the term "Affiliate" shall mean, with respect to the
Company,  any person or entity which,  directly or indirectly,  owns or is owned
by, or is under common ownership with, the Company.  The term "own"  (including,
with correlative  meanings,  "owned by" and "under common ownership with") shall
mean the ownership of 50% or more of the voting securities (or their equivalent)
of a particular entity.

               9. Notice.  Any notices required or permitted  hereunder shall be
in writing and shall be deemed to have been given when  personally  delivered or
when mailed,  certified or registered mail,  postage  prepaid,  to the following
addresses:

               If to the Employee:

                               C. Bradford McLeod
                             14256 Manderleigh Woods Drive
                             Town and Country, Missouri 63017

               If to the Company:

                           Outsourcing Solutions Inc.
                      390 South Woods Mill Road, Suite 350
                          Chesterfield, Missouri 63017
                                 Attn: President

               With a copy to:

                              McCown De Leeuw & Co.
                              101 East 52nd Street
                             31st Floor
                            New York, New York 10022
                            Attention: David E. King




               10.    General.

               (a) Governing Law;  Jurisdiction.  The validity,  interpretation,
construction  and performance of this Agreement shall be governed by the laws of
the State of Missouri  applicable  to  contracts  executed  and to be  performed
entirely within said State. Any judicial  proceeding  brought against any of the
parties to this  Agreement or any dispute  arising out of this  Agreement or any
matter  related  hereto may be brought in the courts of the State of Missouri or
in the United States District Court for the Eastern  District of Missouri,  and,
by  execution  and  delivery  of this  Agreement,  each of the  parties  to this
Agreement accepts the jurisdiction of said courts,  and irrevocably agrees to be
bound by any judgment  rendered  thereby in connection with this Agreement.  The
foregoing  consent to  jurisdiction  shall not be deemed to confer rights on any
person other than the respective parties to this Agreement.

               (b) Assignability. The Employee may not assign his interest in or
delegate his duties under this Agreement.  Notwithstanding anything else in this
Agreement  to the  contrary,  the Company may assign this  Agreement  to and all
rights  hereunder shall inure to the benefit of any person,  firm or corporation
succeeding to all or substantially  all of the business or assets of the Company
by purchase, merger or consolidation.

               (c)  Enforcement  Costs.  In the event that either the Company or
the Employee  initiates  an action or claim to enforce any  provision or term of
this  Agreement,  the  costs and  expenses  (including  attorney's  fees) of the
prevailing  party shall be paid by the other  party,  such party to be deemed to
have prevailed if such action or claim is concluded pursuant to a court order or
final  judgment  which is not  subject  to appeal,  a  settlement  agreement  or
dismissal of the principle claims.

               (d) Binding  Effect.  This  Agreement  is for the  employment  of
Employee,  personally,  and for  the  services  to be  rendered  by him  must be
rendered by him and no other person.  This  Agreement  shall be binding upon and
inure to the benefit of the Company and its successors and assigns.

               (e) Entire Agreement;  Modification.  This Agreement  constitutes
the entire  agreement of the parties  hereto with respect to the subject  matter
hereof  and may not be  modified  or amended in any way except in writing by the
parties hereto.

               (f) Duration.  Notwithstanding the term of employment  hereunder,
this Agreement shall continue for so long as any  obligations  remain under this
Agreement.

               (g) Survival. The covenants set forth in Sections 6 and 8 of this
Agreement  shall  survive  and  shall  continue  to  be  binding  upon  Employee
notwithstanding the termination of this Agreement for any reason whatsoever. The
covenants  set forth in Sections 6 and 8 of this  Agreement  shall be deemed and
construed  as separate  agreements  independent  of any other  provision of this
Agreement.  The  existence  of any claim or cause of action by Employee  against
Company, whether predicated on this Agreement or otherwise, shall not constitute
a defense to the enforcement by Company of any or all covenants. It is expressly
agreed that the remedy at law for the breach or any such  covenant is inadequate
and that  injunctive  relief  shall be  available  to prevent  the breach or any
threatened breach thereof.

               IN WITNESS WHEREOF,  the parties hereto,  intending to be legally
bound,  have  hereunto  executed  this  Agreement the day and year first written
above.

                           OUTSOURCING SOLUTIONS INC.


                                         By:  /s/ Timothy G. Beffa 
                                              ----------------------------------
                                              Timothy G. Beffa, President and
                                              Chief Executive Officer


                                         EMPLOYEE

                                              /s/ C. Bradford McLeod
                                              ----------------------------------
                                              C. Bradford McLeod