Collections. It’s most freelancer’s least favorite part of the job. But if we don’t it, then we don’t get paid. I’ve already covered red flags for freelancers to avoid and ways to protect yourself from online scammers. But sometimes you can do everything right and still get screwed.
Right now, I have two clients who are over a month behind on paying me. These are clients I’ve worked with for awhile, so I don’t think it’s a cash flow issue and I trust that it will eventually get sorted out. Still, it’s a PITA that full-timers don’t have to deal with (not that I’m tempted to jump back into the 9-5 workforce; quite the contrary).
In both cases, I’ve begun the collections process with a strongly worded email and followed up in a way that seems appropriate to that situation. One client got a registered letter yesterday. The other got a follow-up email and a phone call. I sometimes have trouble keeping my cool (I’m a redhead, after all) when I’m in these kinds of situations, but I try to stay as professional and factual as possible. Hence, the registered letter clearly articulating why not paying is not an option.
I know some writers have taken their clients to small claim’s court, but that’s not an appealing option because of the geographic distance. I also tried using Writer’s Weekly’s Whispers and Warnings column in the past, and I’m not convinced that it had the desired impact (I eventually got a check but it was months later). Instead, I’m planning to get ASJA‘s Grievance Committee involved if I can’t resolve this on my own.
It’s purely by coincidence that I haven’t done more work for these clients, but it’s probably for the best. Although I sympathize with editors or clients who have no control over the business side of their company (and I realize that refusing to do more work could unfairly punish them), it could exacerbate payment issues down the line.
What about you? What’s your strategy for dealing with non-paying clients? Do you keep working for them or put a hard stop on new projects?
This is such a tough issue. I don't know why, but dealing with money makes me so uncomfortable. But I like your suggestions; they're proactive without being in-your-face. I've been lucky in the past; but perhaps that's because I force myself to be patient because of my difficulty with the subject. Sure, I've had to send some follow-up emails and such, but that kind of persistence has (so far) worked in my favor, even if payment is late.
Let's just say it once took me 6 months to get paid, and ended my relationship with a client. Not a bad thing really. But stressful? Yes, very.
Good luck getting paid Susan. Sending a registered letter sounds like a good approach.
One thing I learned from my encounter was to target the accounting department directly and keep the client out of it. When it comes to accounting, often the client has no power. So involving them in getting final payment just makes things more stressful.
I've recently had problems with two clients, too. One of them is a client I've done projects for before, and the client is now a month late paying me. I've been sending weekly follow-up emails, and her problems seem to be legitimate – she's in the UK and has been using PayPal to make international payments, and PayPal has arbitrarily imposed restrictions on her account because of the different payments/currencies, etc. I've had problems with PayPal, so I believe it. But it's getting ridiculous at this point – she says she wants more work once we resolve this, but she never sends me updates proactively – only when I poke her. I haven't decided yet what to do if she doesn't pay at all.
My other recent problem was a client who was apparently an agency – I completed half the project and was waiting on feedback before completing it, which he never provided. I kept following up and got a response 3 weeks later that the client had decided to do the project in-house. I had to explain that I would have been happy to provide revisions, etc. but since I did the work he owed me for it. I was even nice about it – I said I'd cancel the other half of the project if he paid me for the half I'd already done, but he didn't reply until I sent an email threatening to involve a third party to resolve the situation. Then he paid me promptly and even left positive feedback. That took five weeks to resolve.
I don't have a real "strategy" because this literally hasn't been a problem for me until the past two months. But I do have some clients who slow pay, and I sometimes send a friendly reminder email saying something like "I need to close this project out in my accounting system and it's showing that payment is still outstanding. Any idea when I might see payment so I can set a reminder to close this out in my system?"
@Sheryl: I suspect that men have an easier time with collections, just as they have an easier time negotiating salaries.
@Janet: I'm torn about contacting accounts payable directly. Sometimes it works (and relieves the editor from having to be the middleman), but some micro-managing editors/clients might get miffed if you go over their heads.
@Dachary: What a nightmare! Glad your second client got worked out. Hopefully the first one works out, too!
From my experiences, it's best to cut your losses early. In addition to the lost wages, it's exhausting and time consuming to chase "slippery clients".
Spend the time cultivating new ones. I also recommend reporting them to Writers Beware and other advocate groups.
Thanks Susan, that's good advice. This was also a bit of an odd case involving some contract hijinks. It was a good lesson in terms of re-thinking who I wanted to work with.
Collections is always tough. You have to determine at what point to get aggressive and nasty. You're on the right track with the strong emails and register letters though.
My personal policy for collections is to start off nice and to begin sending emails when the invoice is late with my terms policy. I also have a late fee and interest in place to encourage payments on time.
If the nice emails do not work, then I move on to the strong emails, like you are doing. Most of the time, these tactics resolve the issue. However in some cases I have had to hire a collection agency to take over the process. But I only use this as a last resort.
Good luck on your collections efforts and I hope they get resolved soon.
It's a tough thing. When it's happened, I've tried to be persistent – following up on a regular basis. Email and phone are necessary I think.
Mine is tried-and-true: I send out three invoices in three months. Each one beyond the first one has a late fee, compounded monthly (I charge 25%). On the last one, I include the bolded statement: "Please pay within 10 days to avoid litigation." And I repeat it in the email. If I think they're going to try avoiding it altogether (by claiming they never got the email), I'll send it snail mail, as well.
I've never yet had to take someone to small claims court – they've all paid after the threat. But if I had to, I'd do it.
Repeated invoicing and follow up. This has not been a problem for me much, but in the event a check is late I'll pick up the phone and ask. After all, it's not personal, as they say…it's business.
I have a situation that maybe you and your readers can offer me some advice on. I have been owed money by a former client for nearly a year. It isn't a huge amount, but still. What really irks me is that they did not include this amount on the 2009 1099 they sent me, yet they did, in fact, receive my invoice for the amount in the summer of 2009, and I have proof of that via numerous email exchanges. More recently, they claimed that they would just pay me the money in 2010 and issue me a 1099 for 2010 as if I had earned the money in 2010, and I was fine with that, but it's been months, and they still haven't paid up, and now they aren't answering my emails. Any advice? Should I bother pursuing it? They owe me just under $300. I suspect some fraud could be going on here because they didn't include the amount on my 2009 1099. I find it hard to believe that was an accident.
@Anonymous: That sounds very shady! They may be thinking they have until the end of the year to pay up, but that's just plain wrong, because it's like taking an interest-free loan against your will! If it's a publication, I'd contact Angela Hoy at Writer's Weekly or (if you're a member) the ASJA Grievance Committee. If you have a phone number, I'd call. Or send a registered letter demanding payment. That's just plain ridiculous, and I'm sorry you're dealing with this!
I met one case that troubles me a lot, after I did freelancer job for one guy, he asked me to continue working for him, but I didnt have much time then so I rejected, then he wrote to some forums and said I was a lier. I was so angry that I wrote to the admins of these forums and showed them proof that I am innocent. Then that guy's posts were deleted, then the story ends.
I think one way to protect yourself is very carefully chosen who your clients are, seach their identities and older actions on internet.