No, Virginia, there are no perfect clients.
April 6, 2006 7:14 PM   Subscribe

[FreelanceFilter] I need a lawyer's advice! (or other freelancers) I work as a freelance web/Flash developer, and getting money from clients after the job is done is always a huge pain in the ass...

I have come to the conclusion that there are 6 basic types of clients out there:

1) The client who wants to pay you hourly...and runs up hour after hour after hour, with you reminding him that time is money, and he's running up quite a bill...and then gets sticker shock when his job is done, and refuses to pay.

2) The client who makes *tons* of out-of-scope changes and additions after the job is done (but before you have your check), and demands that they be made, or he's not going to pay you at all.

3) The client who feigns ridiculous outrage over something utterly trivial, which you likely either suggested changing weeks prior only to have your suggestion snubbed, or which was a change specifically requested by the client himself...and refuses to pay on grounds of his "outrage."

4) The client who pitches a massive fit if you try to push back even an internal review conference call...then never pays you, instead giving you a "check's in the mail" runaround for months.

5) "No... I don't have any examples of designs I like. I don't even really know what I want, but I'll know it when I see it. I dunno, just make it fun. (5 stabs at "fun" later) No...that's still not fun enough. Can you add some starbursts? What about comic-sans? That's a fun font! Why don't you make it look more like a PowerPoint presentation, but use that font to fun it up some?"

6) Wonder-client. This one's rare.

Anyway, I'm in a sticky predicament with a client of the 4th variety. So, here goes:

Prior to leaving for grad school and starting my (now second) extended stint of freelancing, I was working at a prominent advertising agency here in town. After my departure, some friends at the agency needed some Flash work done, and contracted me.

They handled all interaction with the client, sent estimates, received purchase orders, etcetera, and did the visual design of the site. I did the build, programming, and sound work, and offered a lot of extraneous web advice -- some taken by the client, and some not.

I was to bill the client directly rather than bill the agency, despite my minimal contact with them, and the agency had all of my estimates approved.

Because of this, I never had in my hands a purchase order, never got to draft a contract, and never recieved a deposit up-front for work to be performed. I *do*, however, have a lengthy e-mail paper trail involving both the agency and the client detailing what was to be paid, to whom, and for what services.

Upon completion of the job, I invoice the client in two parts - each with a note explaining that payment is expected within 30 days. The client agrees to this term via email, and tells me that they have put the information "in the system" to be mailed out on a certain date (30 days exactly after invoice).

30 days pass. 40 days pass. 50 days pass. After many calls and several emails of escalating urgency on my part, and after several claims of "oh, it's in the mail," and, "I'll send it out first thing in the morning," on their part... I finally get my check for the first invoice. They tell me the second one will be on time (it was invoiced a few weeks after the first).

Now, it's been 60 days since they got the 2nd invoice, and I have no sign of payment. I have not heard back from emails I have sent. The project manager at the advertising agency called them and was told that the person responsible for mailing the checks was "out for a few weeks."

What is my recourse, here? What are my options? I need the money, obviously, or I would have done the work. Can I take down the site for non-payment? Would that be legal? Would it be ethical? It would certainly piss them off, and it would probably piss off the agency that acted as intermediary. That might equate to a real cost in terms of potential work down the road (and they might turn into the client that flat-out refuses to pay at all), but then.... the client is also currently using goods that have not been paid for in full.

What should I do?
posted by kaseijin to Work & Money (14 answers total) 1 user marked this as a favorite
 
Don't take down the site. First of all, it dosn't *even* sound like you've really started to threaten him. It'd kinda suck to have the site taken down without warning.

I would leave the site up. Tell him that you're really upset and if you don't get paid soon you'll have to seek legal options. Actually, I would tell this to the ad agency first. Tell them you're pissed since they acted as an intermediary. If they can't get results, then start with the lawyer stuff. If they still don't pay, then get a lawyer.

Don't just take down the site and then hope you don't get sued.

Also, tell them that if they don't pay you, they'll need to pay *your* legal bills as well as their own, because it's a contract dispute.

They paid you for one, they'll probably pay the other if you pressure them enough.
posted by delmoi at 7:22 PM on April 6, 2006


Best answer: Hmmm. What are your recourses? Hmmm. Is this client someone which you might want to continue to work with? Even if right now because you are so pissed at them the answer is 'no'...even still. More on that later.

If it were me, I would send a 3rd invoice indicating that if the 2nd invoice was not paid within x days that a late payment fee of x would kick in. I have no idea if it is legal or not, but it has worked for me (both with paper invoices and over the phone.) It's amazing how fast cheques can get written.

For me, I very rarely do a job that doesn't have partial payments along the way. For instance, x amount on signing a contract, y amount for delivering 1st stage and z for the finish. This protects you a little since you get some money as you work on the project. If a client bails, you don't lose the entire fee. Almost every time that I waited for end of project payment I was paid less than the original agreement. I work in the arts, so sometimes that is unavoidable.

I know you didn't have it as an option for this particular client, but get it all in writing. I mean all of it. Even if you end up with a big ass contract, who cares? Good clients don't mind since they have no intention to stiff you.

Lastly, back to 'burn the bridges' I will never work for them again. There is only one company that I ever worked for that I found so poisionous so evil mean-spirited so cheap that I swore swore that I would never ever work for them again, money and prestige and career be damned. Well, I get signed up for a great project with a great company...but they are going to partner with the poison people. What can you do?
posted by typewriter at 7:33 PM on April 6, 2006


Best answer: We have one very large client with whom we originally contracted an hourly consulting package.

We formed an agreement stating that they would pay us up front for the month's estimated hours. In this case, they were paying for 40 hours up front. At the conclusion of each month, they'd pay us the next month's 40, in addition to any overage incurred, so long as we were keeping them well-informed about the hourly rate, and we had an established not-to-exceed, so that they knew what the ramifications of them asking for certain, sweeping changes and massive new features was.

In your situation, at this point, I think you should send them a past due notice. Outline the original due date of the second invoice, note carefully what today's date is, and explain that if you do not receive the check within two weeks, you will deactivate the site. Two weeks further, and the account will be sent to collections.

In the future, make sure you have a contract signed with whomever you're doing your work with, even if you're freelancing and even if it's for a third party. It might be obnoxious, but it's necessary to have recourse here. Build a late fee system into the contract of 1.5% for every day past, say, one week past due.

We're still working with our major client a year later, but we've gotten lazy with our invoicing, so much so that we now just bill them for the month's actual hourly count. Keeps the accounting cleaner, and we know they're good for it, since their entire business is on our servers.
posted by disillusioned at 8:57 PM on April 6, 2006


Take the site down. Business is business.

I had the same type of client. I put up with so many demands (not good enough, let's redo this another way..no wait go back to the first one) and after the work was done, they strung me on for months. I waited patiently, sent multiple reminders and then finally took the whole damn site down. Every last kilobyte. Then they came crying to me and overnighted a check.
posted by special-k at 8:57 PM on April 6, 2006


PS: Not sure how ethical this is but I would say its legal because you took back services they didnt pay for. I forgot to mention that I designed their entire site so I had no qualms about taking everything down.
posted by special-k at 8:59 PM on April 6, 2006


Best answer: If you've sent out notices and invoices, leave the site up, so that there is proof of delivery (unless your contract just says payment for your time). Keep copies of all your emails, including the one that where you say you've delivered on the contract expectations. Send a demand letter and outline the terms for interest and note that you will seek legal action as of a certain date. On that date, file in small claims. Keep careful notes. Date everything. Put it in a binder. Be very organized. Sue them. When people realize they need to hire a lawyer, spend time in court and deal with a big hassle, checks show up.

In the future, get a signed contract, deposit, invoice at milestones (or dates), keep content on a staging site until payment has been received (and note this in the contract), and do not deliver all the content to their site until you've received 90% of pay. Make sure the contract talks about hours or milestones, not receipt of the final uploaded site.

A good contract is a freelancer's/consultant's best tool. Having a good contract pre-empts many of these problems. I wouldn't be in business after 9 years if I didn't have good contracts.
posted by acoutu at 9:05 PM on April 6, 2006


On second thoughts, listen to acoutu

I was no longer expecting to get paid and didnt care to burn the bridge with that client so thats why I did that. I just didnt want them to have anything for free.
posted by special-k at 9:14 PM on April 6, 2006


As for interest and penalties, consult the usury guidelines for your locale. 1.5% per day probably isn't legal. Even in Canada, where guidelines for usury are somewhat lax, the max is 60% per year.
posted by acoutu at 10:55 PM on April 6, 2006


Best answer: kaseijin, I don't know you. Take this with a grain of salt. Many people creative industries, who have been forced (or by choice) into freelance work...struggle with communication with clients.

Frankly, you're going to eat some money. The key is to minimize it.

Pick up the phone and call. A major mistake is thinking that 'email' is equivalent of personal contact.

When they say they'll mail a check, if you're in their city, indicate you can save them the postage as that you're going to be in that neighborhood! How fortunate.

We deal with this in film, and I may or may not have a client like this right now. Worst yet, the work is finished and in their hands.

1) Send them a 60 day past due, incur a penalty payment.

2) Bill the group that hired you since it's their client Realize that this will piss off the group that is (supposedly) bringing you business. They are trying to shift their terms with their clients to you. Indicate that since the client hasn't paid...it's their responsibility.

3) Have a friendly lawyer send them, on letterhead, that they past due. Send it to AR and CC the owner.

4) Do not under any circumstances take the site down. Indicate that if payment isn't received in 7 days, you'll put a banner noting their delinquency. Feel free to use the blink tag as well. If you have FTP access that is. Wait, don't. They'll see it as some level of defacement. Talk to a lawyer before you do this.

Do not disparage the company beyond that.

With your client types:

1) Hourly. Ask the client at what dollar amount they'd like to be contacted. Mention that you could invest what would be thousands of dollars of your time.

2) The "reviser"
Deliver and ask for written changes. When the first set of changes occur, indicate that partial payment is due. Indicate that two more revisions (one major, one minor) are warranted, but beyond that, you need to talk about renegotiating the work - as your quote did not include endless revisions and you consider the second 'major' change, not indicated after the first revision as a warning to endless revisions If they client does not deliver half here, tell them you'd like to work with them, but you don't work for free....that half is due (and let them know upfront).

3) Outrage. He's actually pretty simple. Inform him that you indicated this weeks earlier. Nevertheless, ask him simply "what would it take to make it right." If he tells you, then his 'outrage' should be taken down a level or three. Explain to him when you make it better, that you, as a contractor expect a check. If he does not think it's possible, tell him you're sorry that the two of you couldn't find a harmonious solution.

4) The non-payer. That's what this Ask.mefi is about.

5) The commitment phobe.
The guy who won't make a decision.
He wants you to design, and you should break out the design separately from the hourly work. You will not commit to major design until you get his agreement that you're working on what he wants. He may be indecisive. He may be afraid of 'committing' to a style because then, he'll be responsible for it.

When you design a building you can't say "big" or "small." And if a non creative person struggles, ask him to surf the web for an hour and bring some ideas. Additionally, look at their competitors to see if they like those.

"More fun"
At the point where they start to grasp for straws, indicate that the constant creative revision "gross changes" will cost money. Tell him you really want to work with him, that the creative design time is just as laborious as the back end work.

The secret with this guy, is that you stop the work. Indicate that when he makes a decision, you'll be able to help him. But he's got to commit.

He's really #2 in disguise and if you don't manage his expectations right away, he'll become #3, and worse yet, #4 when his outrage keeps him from paying.
posted by filmgeek at 11:07 PM on April 6, 2006


Best answer: Pulling the site is the nuclear option, and you're a long way from that. Especially as they've provided partial payment (which suggests to me that they're just a normal business, trying to stretch the time between money in and money out). I wouldn't even threaten them at this point; not paying until you have to is well within the realms of normal business behaviour.

The way to get bumped up their priority list is not to sit at home waiting for the cheque, it's to be the biggest pain in the arse on the list.

You do this by getting a direct line number, and making the person on the end of that line responsible for your problem. The trick is to always get two things from the poor sap on the phone: (a) what they will do and (b) when they will do it by.

"We'll put that in the post"
"When will you put it in the post?"
"Thursday or Friday"
"Great, I'll phone you Thursday morning to make sure it's been done"

Hammer away at this. And always, always phone back to make sure they've held up their commitment. If they haven't, make them squirm for a bit (remember, always deal with the same person) then get a new commitment.

If you start getting the "lost in the post"/"guy who writes the cheques broke his hand" bollocks, or if you absolutely cannot get a commitment out of them, pull them up on it ("do you really expect me to believe your company has no way to write cheques for the next 2 weeks?") then give them one: "OK, I'm going to [contact lawyer/pull site for non-payment/whatever], I'll phone you back in 2 hours to let you know what's happening".

Either way, things have moved forward, they're always working to very clear deadlines, and you're not being stalled.

For what it's worth, I've done this to clients and still gone back and done very friendly projects for them on a hankshake basis. Nobody's going to think badly of you 'cos you want to be paid and you're politely hassling them to make sure it happens.
posted by Leon at 2:51 AM on April 7, 2006


Best answer: I also do freelance art (web, 3D, design) and have had some of the same problems.

Is the person you are contacting the owner? Is there someone else you can call in the company? I’ve had to directly call the accounting department of one company to get the ball rolling. The accountant said to contact her directly with all future billings.

Send out a late notice invoice with late fees (it used to be 1.5% per month max, I think it’s gone up).

Document everything – all emails, letters, conversations, etc.

Don’t threaten with a lawyer unless you are prepared to follow through.

Go visit in person if you’re in the same town – become friends with the accountant.

If nothing else works and small claims court and/or lawyer is the last option, then pull down the site (but give them notice in writing with a specific date).

I wouldn’t worry too much about burning bridges. From my experience, a customer that gives you a hard time paying will ALWAYS give you a hard time paying. And they will always find problems with your work when it comes time to pay.

For the future on multi-staged, decent size jobs – get a startup fee (and don’t start until you get it). Require payments at certain stages in the process. DO NOT release the final product until you receive final payment. Revisions are normal, but include the number of revisions for each stage (like 3) and state that additional revisions will cost more. I’ve had customers nickel and dime me to death with “Wouldn’t it be cool if you could just add….”

This is a must have book – includes pricing, contracts, etc., for the working artist. I wish I had bought it just out of school.
posted by JimBobNoPants at 9:08 AM on April 7, 2006


Response by poster: Thanks, guys, for your advice. Yeah, I think one of the biggest things (aside from needing to have written up a contract for this job -- something I normally try and do) is that I need to be more assertive on the phone. They're about an hour's drive away, so maybe a visit is in order, too.

Thanks!
posted by kaseijin at 12:32 PM on April 7, 2006


This is stormygrey's significant other responding.

Speaking as someone who has been in the same situation, and spoke to a couple of different attorneys about it, do NOT take down the website. That is simply not a legal option, assuming that the webhosting belongs to them.

Look at it like this: You commission an artist to paint you a portrait. You're a few days late paying, and he has keys to your house, so he comes in and gets it back while you are not home.

Legally, it is apparently the same situation. I don't agree with it, and it ma vary from state to state, but this is what I have been told by 3 different attorneys whom I know personally and trust. (Georgia here, if it makes much difference.)

Of course, this is all assuming that the site is on their webhosting. If it's on your webhosting, then feel free to take it down at your pleasure.

In the future, if at all possible, dvelop the sites on your own webhosting. This is how I handle it for this very reason, when I ever can.
posted by stormygrey at 3:42 PM on April 7, 2006


In the future, if at all possible, dvelop the sites on your own webhosting. This is how I handle it for this very reason, when I ever can.
posted by stormygrey at 3:42 PM PST on April 7 [!]


Good advice stormy...

But I believe when He's saying pull down the site, it's just his web design he's pulling. The company still owns the domain and has the hosting and still has the right to find another web designer. Am I wrong in this? I know it's important for a freelance designer/artist to define who owns the rights on a project. I would imagine the company would retain rights generally on it's company website, but not until they have paid/fulfilled their contract (or verbal agreement). Ahhh, but of course, IANAL....
posted by JimBobNoPants at 10:42 AM on April 11, 2006


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