Freelancers face a number of concerns. We worry about long gaps between big projects. We might be concerned about rising competition as more people set up shop as home-based designers, writers and programmers. And we fret about the willingness of new clients to make the final payment when the work is complete. Few of us though really fear being sued. That could be a mistake.
In August 2012, Lesley Kemp, a freelance transcriber, completed her second assignment from Resolution Productions, a company based in Doha, Qatar. According to her blog, instead of receiving payment within weeks of sending her invoice, she received an email from the company’s Managing Director, Kirby Kearns, informing her that because of “very late payments” from their clients, they would have to delay payment.
Delayed payments are annoying to freelancers but they’re not unusual. One survey of 182 freelancers in the UK found that while 60 percent said that they were always paid on time, 10 percent felt that late payments were still an obstacle for a one-person businesses. Work as a freelancer for long enough and you will, almost inevitably, run into the occasional client who hums and haws over the invoice and needs frequent reminders before they cough up the cash.
From Complaint to Offers
Kemp waited for two weeks for her payment then chased the client again. Eventually, the fee was delivered… minus £25 for bank charges. At that point, Kemp chose to tweet about what happened.
“It crossed my mind that my colleagues ought to be aware that doing business with Resolution Productions could result in delayed and even incomplete payment and that I had a responsibility to make this knowledge public,” she explains on her blog.
The client later made up the shortfall, Kemp tweeted that information too and she believed that the story was over. Instead, she received a letter from a libel lawyer suing her for £50,000 in damages plus costs estimated at a further £70,000.
Kemp noted that she can’t afford legal representation and that she’s ineligible for legal aid to fight the case. The lawsuit, she estimated, could ruin her.
“I am almost 56 years of age, close to retirement but it looks very likely that this action by Kirby Kearns will result in the loss of my home and business and pretty much destroy my life,” she wrote.
Fortunately, that hasn’t happened. Some keen tweeting led to media exposure of the case. The Libel Reform Campaign, a group pushing for a change in the UK’s libel laws, set up a fund to help pay for Kemp’s defense and she has received the help of specialist lawyer Robert Dougans of law firm Bryan Cave. Dougans is best known for defending Simon Singh, a science writer sued (unsuccessfully) for libel by the British Chiropractic Association in a dispute that invigorated the call for libel reform.
It’s likely that the case will end well and the publicity that it’s generated hasn’t been bad for business. Kemp’s Twitter timeline now includes several responses to people asking about her availability for projects. But being sued for complaining about the late payment from a tardy client is still something most freelancers would prefer to avoid.
And we do have a number of options.
The Freelancers Union, which estimates that 80 percent of independent workers “will be stiffed by clients in their careers,” is supporting the Freelancer Payment Protection Act. The bill would allow freelancers in New York State who are owed more than $600 to file complaints with New York State Department of Labor. Victims would receive 100 percent of the amount due, plus attorney’s fees and interest.
Smart use of the law might help too. Freelancers waiting for payment can file a complaint at their local small claims court themselves but few of us have the time or the inclination to chase up relatively small sums and even if we win, we still have to enforce the judgment. Some law firms will do that for us, usually in return for a share of the fee. Back Off Solutions in the UK, has a slightly easier system. The company charges from just £35 to make up to five demanding phone calls and send a couple of angry letters.
Dispute Prevention Is Better Than Dispute Resolution
But preventing a dispute is always better than trying to solve one. The Freelancers Union also provides a contract creator that can give all freelancers a legal framework for outlining expectations and resolving disputes. A good contract might not prevent a client from holding out on payment but it will make clear what can happen if they do. Knowing that they’ll be in breach of contract could be enough to make most recalcitrant clients pay on time.
In practice, though, the best protection available for freelancers is to reduce the risk as much as possible by keeping each payment as small as possible. Break payments for big projects into milestones and if a client doesn’t pay, you’ll have minimized your losses. The idea that we should be willing to walk away from amounts we’re owed isn’t pleasant but with time as an important an asset for freelancers as money, it’s something that we’re all likely to find ourselves doing at some point.
As for tweeting about those bad clients, while it might be justified, it’s probably not a good idea. Most freelance sites allow freelancers to provide feedback about clients in the same way that buyers can review service providers. That’s a much better place to warn other freelancers about bad payers, and in a way that’s less likely to result in legal action. For the most part, disputes between clients and freelancers are best kept to ourselves, despite the temptation to have a good rant.
Lesley Kemp’s announcement of her problems with Resolution Productions might have given her a few more enquiries but most of us are likely to find that publicizing disputes only increases the length of the gaps between big projects — and fills those gaps with expensive problems.