September 5, 2010

How freelancers can avoid getting stiffed, part two

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In my last post, I offered some precautions self-employed workers can take to avoid getting burned by clients who don't pay.

[Photo by wsssst]

But what if, despite your best deadbeat radar, the many precautions you took at the start of a project, and your repeated attempts to claim your cash, you still find yourself dealing with a freeloading client who won't send payment? Some suggestions for what to do next:

Withhold any pending work for the client. Don't look this gift leverage in the mouth: If the client really wants their project completed, they'll pay the amount they owe you to date. Besides, you don't want to risk not getting paid a second time.

Deal directly with Accounts Payable. Forget sending repeated requests for payment to the editor, art director, or project manager who hired you to do the job. It's time to bypass your contact and deal directly with those in charge of the purse strings -- the accounting department.

Resubmit your invoice with a 2 percent late fee. Now you're speaking a language that Abby or Arthur in Accounting can understand. Although you may not collect that extra 2 percent, the threat of compounded late fees could prompt a foot-dragging accounting department into action.

Get a lawyer to draft a threatening letter. Have the letter mention that the client is in violation of your contract. If you can't afford an attorney, try a sliding scale legal service like Washington Lawyers for the Arts.

Threaten to send your client to collections. This recently worked for me when a client was dodging my calls and invoices, despite the fact that I'd known the owner of the business for two decades. Calling the company's office manager and mentioning that the account was three days away from being sent to collections got me my check in a jiffy.

Take your client to small claims court. You don't need a lawyer to do this. The website Nolo.com offers a handy page on small claims court dollar limits in each of the 50 states. Note: The small claims court limit for many states is below $10,000 (in Washington, the limit is $5,000). For additional details, see your state's small claims court website.

Engage in public humiliation. A number of freelance writers have managed to get delinquent clients to pay by reporting them to the Whispers and Warnings section of the freelance writing web magazine WritersWeekly.com. Not only does this free site advocate on behalf of stiffed writers and warn other freelancers about companies to avoid, it's shamed more than a few deadbeat customers into paying up. But you don't have to be a writer to benefit from this online outing of clients who don't pay. The Freelancers Union -- an advocacy group for the self-employed -- also offers a handy "Who Not to Work For" forum, where freelancers of all stripes can warn others about clients who don't pay.

Of course, there are no guarantees that any of these tactics will work, but sometimes the threat of late fees, a lawsuit, or a black mark on a sluggish customer's credit report or reputation is enough to mobilize them into action.

Freelancers, what tactics have you tried to get a deadbeat client to pay? What's worked and what hasn't?

Michelle Goodman is the author of "My So-Called Freelance Life" and "The Anti 9-to-5 Guide." E-mail Michelle at mgoodman@nwjobs.com

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1 Comments

Chris on April 16, 2011 3:55 PM | Reply

Another great tip is to do a back ground check/skip trace to see what assets your debtor may own. This way you can determine if there is even anything to even go after. If you find the debtor owns nothing, it may not be worth the time or money. You can check out http://www.dtgrecovery.com for more info on how to do this as I found them to be very helpful.

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