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It was one of my biggest projects, and I was about to get paid a considerable amount of money for three months of work. Little did I know, a client invoice dispute was on the horizon.
I was excited when I hit send on the invoice. A week passed, there was no response, and my bank balance was approaching 0.
I waited another week, still nothing. I emailed the client to see what the problem was but didn’t hear back from him.
I waited another week, and by now, I was bothered. I didn’t want to borrow money to survive. But finally, I got a response. It wasn’t good news, though. The client wanted to clarify some of the fees in the invoice.
There was a misunderstanding about what had happened two months back, and it was too late to rectify because I had already spent my hours doing that work. The onus is on me to make sure the client has a great experience, so I waived that part of the invoice. It was still a lot of hard work for which I won’t receive anything.
The client then approved the invoice and says I’ll get paid soon. Luckily, the invoice was paid a month later after multiple follow-ups, but there have been far worse stories from friends of not being paid for long periods of time.
Naive as I was as a beginner, I didn’t imagine that the payment would take months to get. I never knew it would be that much back and forth.
I don’t freelance as often anymore, but I work with a lot of freelancers so I understand the problem from both sides.
As a client, I do face the problem of unclear communications. There have been a lot of situations in which invoices I’ve received have been unclear, and I tend to work with people who are extremely clear about the scope of the work and how much it will cost.
- Communicate clearly with clients to avoid misunderstandings.
- Use professional language and tone in all communication.
- Provide clear details about the project scope and timeline in the contract to avoid later disputes.
- Consider using a collection agency as a last resort for unpaid invoices.
What does it mean to receive a “dispute”?
An invoice dispute is a disagreement between the customer and the freelancer on the value of services provided by the freelancer. The client basically doesn’t agree that the services you’ve provided are worth the quoted amount on the invoice, or you’ve wrongfully charged for something. Learn more about client disputes.
Like any case of miscommunication and disagreement, both sides will have to find a middle ground somewhere to solve the client invoice dispute. This typically falls on the freelancer to find the middle ground because sometimes, depending on the person, the client won’t be willing to budge on their end.
Ideally, it’s best to avoid clients that cause invoice disputes, but even really good clients can sometimes dispute invoices. Work on resolving the invoice while keeping the client relationship intact, especially with good clients. But in either way, your reputation is on the line and harming that can be more damaging than an invoice dispute.
Most common reasons you’d receive an invoice dispute
An invoice dispute from your client can arise for many reasons. Here are the most common ones you might encounter:
- The amount of time spent on the project isn’t accurate: your client may dispute the fact that something didn’t take you as long as you stated on the invoice.
- Scope of work isn’t accepted upon: there may have been added scope along the way, not included in an agreement.
- Price per hour or per deliverable isn’t agreed upon: the costs stated on your invoice are not accurate to the client.
- Unhappy with the work: the client isn’t willing to pay you for the work they received because it wasn’t up to their standards.
- The client is unhappy with the deliverable or project result: the results projected did not pan out, therefore the client disputes the invoice for it.
- The invoice may have landed in spam: the client might state they never got the invoice, or never saw it, therefore shouldn’t be charged a late fee, etc.
- They may just be procrastinating: simply put, the client isn’t making your invoice a priority.
- The finance department has a lengthy protocol to clear invoices: your invoice didn’t properly outline all deliverables/scope of work completed as they need it to.
How to handle a client invoice dispute
As with any disagreement, staying calm is key. You want to maintain the relationship and never lose your cool.
It’s surprisingly easy to start blowing up at a person and demand, “YOU PAY ME NOW, OR ELSE!!!” but the moment you do that, you stand to both tarnish your reputation and lower your chances of ever getting paid.
The first thing to do is try and jump on a call with the client and understand where they are coming from. You should also genuinely explain to them how much time and work has gone into their project. Most clients are willing to pay you as long as you’re patient and willing to hear them out.
If you need some help reaching out, here’s an email template I put together to help you get on a call with them.
Trust this finds you well.
I want to say again how much I enjoyed working on [project] together. I truly enjoyed the process, and it was a pleasure working with you.
I had sent an invoice on [date] for the project at the discussed fee of [invoice amount]. I would love to get on a call and explain the invoice to you if it’s unclear. You can reach me anytime at [phone number] to answer any questions you might have.
Thanks again, and I look forward to potentially working together again.
Get on the call and if you think their ask is reasonable, then make whatever changes they’ve asked for and send them a new invoice.
If you think it’s unreasonable and there is evidence that they’re budging from what they’ve agreed to, politely share the evidence with them. If the client is honest, then this should help them remember and they should accept to pay the invoice at this point.
If there is no evidence in the form of an email or contract, then sadly, you will have to agree with what the client says. You could negotiate a bit and try to come to an agreement that works for you both, but that’s the best you can do in this situation. If you’re stubborn in such a situation, you may end up with nothing by the end of the negotiations.
If they’re simply unresponsive to your emails, try following up with these email scripts that prove to work.
What do I do if the client doesn’t pay after all of this?
So you’ve reached a point of hopelessness with the client invoice dispute. By now, you’re okay with the idea of breaking ties with this client once they pay this invoice. Here are a few last-resort options to get the invoice paid.
1. Send a Legal Notice
The last thing a client wants to be dealing with is a legal notice for not paying an invoice. It would also scare them because this could have long-lasting damage to their reputation as well.
You could do this via email by asking your lawyer to send a notice, or you could use something like Lawgood or Williams and Harricks.
A legal notice will make the client take you more seriously, but it will also cause some strain on the relationship — so be aware (and ready) for all scenarios.
2. Hire a Collection Agency
There are collection agencies that help with exactly this sort of problem. Search for one in your area, and inquire about their services and if they could help you in your invoice dispute situation.
3. Get short term credit if the client intends to pay but needs time
There are services like Fundbox in which sets up a line of credit for the client to pay your invoice over time, but you get paid upfront. They do perform credit checks, so if your client does not qualify, then a service like this would not work.
If all else fails, cut ties
Cutting ties is the least stressful option, but it also means you don’t get paid. You do this only if the amount is insignificant to you, and you’ve exhausted all your resources to this point.
Here’s the harsh reality of the situation: if you’ve followed all the steps here, and the client still doesn’t pay, you’re probably not going to get paid. The reality is there’s very little you can do now that’ll get the money back.
If the client has their mind set on not paying, would you rather spend hours stressing or just let it go?
I’d choose mental peace, to be honest, but this isn’t true for everyone— especially if the amount means food on your table and rent for a few months. If you do choose to cut ties, be sure to do it as gracefully and peacefully as possible.
Just make sure you never get a client like that next time by isolating client characteristics. Did you find them on some random forum? If yes, don’t use that forum for gigs again. Use this scenario to learn from in the future, and check for the same red flags you’ve experienced.
Ways to avoid an invoice dispute in the future
“Prevention is the best form of medicine”
Ideally, the best way to handle invoice disputes is to not have them at all. Easier said than done, right?
Most freelancers with a lot of experience have a few standard things they do to avoid invoice disputes. The best way to nip this at the bud is by filtering the right type of clients to work with. Here are some pointers.
Get clients that you trust through referrals
Disputes can be avoided 99% of the time by finding quality clients and understanding the basics of freelancer invoicing. What was the common thread with whoever paid me on time as a freelancer? I knew all of them through a referral, or there was some trust established. Either because they were an acquaintance, a friend from high school, or a friend of a friend. So there was always an element of trust on both sides.
Most freelancers with experience get their clients through word of mouth. Because of this, these clients pay better and have lesser reasons to create disputes. Using a word of mouth marketing tool can help you track your leads and who you’re connecting with.
Once you find a good client, to avoid a future invoice dispute here are some tips:
Clear communications and records shared via email
Having all deliverables agreed upon via email is very important. Some people have bad long-term memories and can easily forget specific details. They aren’t trying to lie, they just don’t remember what they agreed upon. This is true for both the freelancer and the client. So having a clear communication trail from the start of the project is very important.
Having a proposal that clearly lays out the scope of work and a rough estimate of what it’s going to cost is very important. Letting the client know what is going to get done and how much it is going to cost at the start of the project is key. Though the scope may change a bit, it shouldn’t drastically differ from what was agreed upon.
Avoid scope creep
If a client wants to make major changes to the scope, stop working on anything. Agree upon the new scope, redo the proposal, share the new estimate and take things from there. Clients assume scope change won’t cost too much and have no clue about how much extra work it may cause. The onus is on you to explain to them what the new changes will cost them.
A basic contract that lays out the scope, payment terms and other terms and conditions helps avoid any issue in the future. It acts more as a deterrence for the client to diverge too much from the initial scope. In any case of disagreement, the contract can be the ultimate source of proof for agreed-upon services, rates and other terms.
Clear invoices with a detailed breakdown
An invoice is less confusing when everything is broken down in terms of how your time was spent, and what was delivered in that time. By doing so, the client has lesser reasons to dispute the invoice. Here are the key details you should have on your invoice, or check out the top invoice software that will automate this process for you.
A few freelancers I know take full payments upfront. The thinking is quite clear, it’s less hassle for the client and the freelancer to get done with the logistics of payments and invoices. Plus you don’t have to worry about the awkward moment later when you ask for payment. If there’s trust in the relationship, this should be easy for both parties to agree upon especially if the proposal is very clear. This also is an easy way to say no to scope creep. If not fully upfront, most clients are willing to pay at least a 50% deposit.
If the project is long term and requires an ongoing relationship across months, it’s best to get paid monthly. This gives the client a monthly breakdown of how you’re spending your time vs a lump sum being asked for months of work. It’s just easier to digest the former type of invoice. If a client has a problem with this, it may be a red flag and you can stop work until they clear the invoice. This way the disputed amount is much smaller if there is ever a disagreement.
Start off with a smaller scope of work
With new clients, where there is little trust, the best way to start is to have a mini project before you take up any larger engagement. This helps you understand the client better and also establishes more trust before you take on larger projects. A big benefit of this approach is that it helps you and the client see if both of you can collaborate effectively. Sometimes working styles may be very different and that can drive each other nuts. So it’s better to start the project off small and grow into larger projects with more established trust.
Communicate with clients about the invoice very clearly, make sure you agree upon a payment method and frequency at the start of the project and work with clients that you have some sort of anchor of trust. It’s better to avoid the situation than to be stuck with invoice disputes.
Without trust, it’s very hard to freelance. You need to have clients that you trust so that these kinds of situations don’t arise. Trust takes time to build, so find clients through channels you are familiar with and make sure you experiment (and do research) with a client before you go all in.
So to prevent invoice disputes in the future, build a good pipeline of clients through word of mouth. Once you do that make sure you have clear proposals and contracts when starting out, avoid scope creep during the project and get paid upfront or monthly. Have a proper trail of communications, which will be extremely helpful in case of a dispute. Do not wait until the end of the project to get paid.
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A law firm disagreed with my invoice for a medical case review and paid me approx $2500 less than what I charged. What are my rights?
Thanks for your article, very helpful and precise to the point, like it!
So I had actually a dispute where the client was “a poor client”, I was kinda in starting the process of being more freelance rather than a fixed employee, so he was kinda my first direct freelance client, and I was flexible for that, in pricing to make the project come out “I dun know how this is seen professionally, would like to know the best ways in this case? should it be to accept less than your pricing or not at all.
Also, for now I have some clients they ask to send them Invoice so that they give downpayment ” and so we don’t use Contract”, but rather he\she pays every step first “before I even start”, and then I receive the money head up of ever stage …I send them Invoice with the items and costs ..then they send me the money ,,so that I start ,,Do you think this is best way? should I still make a contract? – honestly, sometime for “the changes that might pop up”, I think the headup payment is a good way, but still would like to know it all from the professional and smart ways,
please answer the two points, and thank you!
I have been disputing payment from a contractor for a yr and what they want to settle for is not even close to what I invoiced and the hard work I did for them. I am out 78,000 on this job and they kept putting me off until the project was done and they told me I was getting paid.
Three months ago, I was hired to illustrate a little girl for a clients children’s book. I immediately delivered the work. The client “loved it”. I sent her a contract for personal and public printing options. She told me that it could take up to 6 months to hear back from the printers-to decide on the contract payment options. As I set two prices for personal or public printing (with royalties). Last week I asked if she has heard anything back from the printers. “No, she said-not yet”. Then followed with some modifications to the artwork. I told her, no problem, but first I need to get paid. I again sent over the contract. She acted surprised at the $500 I charged. Then I asked again, did you review the contract I sent you three months ago? She said her computer crashed and she lost it. Lol Then she said that she will send me payment. Then she said, “yesterday, some illustrated exactly what she wanted for free” and isn’t going to use my artwork. I explained to her, three months ago she “loved it” and regardless if she uses it or not, the artist still gets paid for the project. She has the invoice. Let’s hope I get a check in the mail. Your article is a good read. I will include, a usage clause to my contracts. Thank you 🙂
My boyfriend done a flat roof the customer wasn’t happy with it.He then went back and done it for free and said he would pay back the money for the materials.They then said it still wasn’t rite so they said they was getting in there own people.We was fine with that then they was saying we owed £3000, I have asked for the invoices for the labor and also the receipts for materials they won’t give them to me but are expecting me to pay the money.Could you please let me know where I stand.
Hi there, I am a client involved in an invoice dispute.
I had some work done and was quoted $40, provided the company with a cheque, and thought the situation was dealt with.
Over a month later, I have now received an invoice for triple the original amount.
Am I required to pay?
Kyle, these kinds of questions are best answered in our free mastermind group.
I find it incredible that clients agree to a quote and contract with payment specific clauses and then shift the goal posts.
The invoice is still outstanding but the customer said the check was already paid for that invoice. What would you do? I would have asked for a check copy and what should I do next?
I made a website for a client who refused to pay because it was a conversion from a clunky CMS to a more user friendly one. The old problems were inherited, like product images, missing categories, etc because it was a CMS conversion. We did however do about $400 worth of extra work on top of the conversion to make the client happy. They asked for a backup of the old website and the new one, thanked us and then refused to pay, locked us out of the website and sued us! This client was doping business with us for a year before this happened. Just wow.
We have a large company client who is always dogging us when it comes time to pay. Because they are a large company and we a small subcontractor, we can not get them to pay upon completion of work. They make us wait until they get paid from their client which can work out to be 6-8 months down the road. We have requested payment as I said giving them 30 days to pay. Needless to say, they won’t pay in a timely fashion. They have agreed to pay us out but with a 3% deduction rate for paying us on time. Go figure. Is this legal?
What can we do. Anything. This happens more that you think out here in Alberta. Some of these large companies think they are above the rules when it comes to paying their bills when ever it suits them. Suggestions – HELP!
My company did contract cleaning work for a major corporation for years. One day we were simply told our services were no longer needed and asked to leave. We sent an invoice for the remaining balance on the Purchase Order. Since we were working for them exclusively, we had no other source of income . Aren’t they obligated to pay the remainder of the PO, regardless of whether we performed the service?
I’m a freelance book translator. Because I’ve never figured out a way to “lock” the English version of a given translation, I’ve had 3 clients (so far) stiff me out of nearly 4000 euros, in the last 2 years. That represents months of hard work! They’ve all paid the up-front deposit, but then reneged on the final document. The catch is that they have to SEE it and read it in order to judge that it’s acceptable, and there is no way to “lock” the content, even in a pdf. These are private “vanity” authors, as my publisher clients have always paid me promptly.
It has gotten to the point that I am going to give up this career and look for another! Another skilled literary translator about to hit skid row.
Any advice or simply consolation would be appreciated! 😉
If they could read it with any degree of understanding then why would they need a translator, let them do it themselves!
If a client is disputing a certain Invoice/Credit Note can they with hold payment for other invoices?
Sadly, they can do whatever they want. If however, they are sued and brought to court, a judge may decide that withholding payments on other invoices was just a ploy to get out of paying them and they could be liable for punitive (perhaps treble) damages.
I’ve been working with a client for over seven years now. They’ve always been about a month behind in payments, but always manges to continue paying. From time to time I have to send friendly reminders to get them to pay, which is always met with the same excuse that they have to keep the lights on before paying their contractors. This year their payment schedule has been rather egregious in that they have run a continuous deficit of 9,000 to 15,000 with the oldest invoices being 3-4 months. They refuse to pay on completion, and yet still expect me to push the work out. Without a signed contract other than my invoices clearly stating a 30 day policy, what can I do get them to pay on time while not losing their business? My recent correspondence asked for all invoices dated 4months old be paid immediately, but I am betting the response will be the same cash flow issue response. Any advice from other freelancers would be appreciated.
You might want to consider offering a small discount for paying on time, like 3% or so, some offer more…
My advice is to have a personal “heart to heart” discussion with the proper individual and state your case attempting to professionally illicit some compassion on their part. Other than that, I’m afraid you’re at their mercy unless you threaten to stop doing work for them..
As a wedding venue dresser, were asked by the hotels wedding co-ordinator ( now no longer worker there ) to dress the hotels main hall for the owners friends wedding. We submitted our price , same prices for all the previous jobs within the hotel. and price was accepted , now 3 months later we are still waiting for payment, As hotel says the bride and groom should be paying and not the hotel. we have never had dealings with the B&G. I have emailed and telephoned and spoke to the hotel lease holder and was told they should have this resolved by Friday , 3 weeks ago still nothing . Now they ( the lease holder and owner ) have asked for a face to face meeting .. should I still prepare myself for court action ????
Hi, i apologize if this is long winded ok. I worked for a company for about 18 months and towards the end, both myself and the company struggled with our arrangement. So we began a new agreement in which i was to start a LTD. company, employ my own staff, take on the whole contracts and manage the works. In the first months invoice we hit multiple issues on 3 out of the four contracts. Issues such as no materials or low materials, inadequate drawings without correct dimensions, no scale etc. This meant that i had a group of lads standing around doing nothing or minimal works simply due to the fact there was nothing they could do until the issues were solved. A large amount of the issues i solved on site but 85% of the works led to instructions. I could see further works that would need to be done but had not been agreed on the initial price and knew that they would also be under instruction. So using my initiative i pushed for the new instructions knowing that we had enough materials for those jobs and we didn’t need any drawings because they were snags. That way i didn’t have 4 guys standing around waiting for a delivery that might and in most cases never did turn up. We had an agreement as per the wage for example day rate paid at 15 per hour and I was to take a further 10%. but the problem we had was the client not wanting to sign the hours on the day and I hadn’t physically received an instruction from the client, i was simply going on the fact that the guy who subbed me the work had said do it and he would make the client sign it or he would hold off works, on other contracts for that client. Now i knew there would be issues with the client giving and signing the instructions. Because at the beginning of the job, I noticed a large amount of faults, with the first fix drawings and took them home. I marked them up free of charge and presented them to the client. Explaining if we get the mark ups which deviate from the original drawings signed now it would save him money by way of charges later. The client made a joke of it belittling me in front of his employees. I wasn’t too bothered about the silly fool trying to make fun. I was more cornered that it now meant i had no choice but to install to drawings i knew were incorrect. Then try and chase the payment. i gave all this info to the guy who subbed me the work and said what do you want me to do. He said just do it to the original drawings and the client will have to suffer the charges. He said if worst came to worst that he would cover it. I have all of the correspondence to the middle man screenshot-ed and have since had ridiculous amounts of emails backwards and forwards and he has only paid the invoice in part [roughly 25%]. The payment was built by his judgement of the hours gauged by how long he thinks the job should take. Not accounting for the time wasted backwards and forwards with instructions, decisions unmade, lack of materials [even when i was promised they where there and in whole], ridiculous drawings that no way possible to be used. Not to mention my prep work done in order to eradicate any of these issues happening in the first place.
Anyway sorry for the rant. OK so long story short. I have had to pay out 4 lads wages with next to nothing paid in and now I no longer have work. I’m a builder, I’m rubbish with paperwork and have no idea. My finances are in a mess and I’m incurring bank charges daily. I am desperate. How do i go about making sure i get my monies owed?
Many Thanks Philimus
I start a emergency job on a bathroom. then stated that I will need to invoice the job. The guy’s wife got mad say way do I have to invoice them?
We did work at a customer. Work docket signed by customer. No payment made. I finally managed to speak to customer, they said not happy with some of the work, so I sent the technician to confirm changes, I sent a mail with the changes. Customer happy, but when the tech’support finished the changes, customer said not happy. We must take equipment out. I phoned the next day to speak to the manager and they are now avoiding me. What is my next step?
Hey got a quick question. Can a person demand to get paid if their is no recored of an invoice?
Recently one of my customer after releasing the Purchase order (mentioned terms : 100% payment against Proforma Invoice).
Now he is making reasons and asking us to not to hold the shipment as payment will be made by early next week. How do i write him regarding getting the payment asap. any format or examples appreciated
Ugh, I’m so glad I read this. I recently got into that exact situations where the client didn’t end up using the logo and so wasn’t willing to pay the final payment. Came quite a shock to me as it was the first time, someone just flat out said ‘no I’m not paying.’… Oh well you live and you learn.
Definitely adding the clause to my contract NOW. Thanks so much for the tips.
I agree that these are great terms to abide by, and I wish I had thought them out sooner to avoid the situation I’m in right now, but at least I’ll know to be this thorough in the future. I’ve just begun freelancing during my break between semesters (senior in art school) and man, it’s a drag to have people ask you to cut your rate, then ask you to consider only charging for what they used because of “creative differences” when all their feedback until that point had been positive! I fear now that they’ll snub me if I send an invoice, but am trying to be confident in pursuing payment. I’ve heard it time and time again that you protect yourself by taking yourself & your work seriously. You’re right that newbie freelancers don’t feel 100% confident in their work, as I don’t! Definitely will handle this differently in the future. Thanks for a great rundown of things to watch out for.
I have a very difficult and shifty client (my only at this stage) who has been playing games to wriggle out of paying outstanding invoices. He has now started disputing the invoices now that these are due.
I tried everything and been very patient but firm when asking for my money. I have an email trail and have sought informal legal advice, as engaging a lawyer would cost me too much.
Can anyone help me with some ideas as to how to deal with this?
Have you considered Mediation?
Dea has a great point – mediation is a much more cost-effective way to go. I don’t know anything about it, but you might check into selling the debt to a debt-collection agency.
Also, for future projects, read Jayne’s comment above about putting a clause in your contract that the burden of collection fees are on the client.
However, it sounds like your real problem is finding good clients so that you can dump this one and chalk it up to lessons learned.
Check out the many awesome posts here on Millo about finding new clients so that you can remove yourself from this crappy client!
I am work in events and I’m freelance. I recently took a job for a company where I was booked for 2 x travel days and 2 x live days. But while on the job the company changed the rules to the travel day stating that in order to receive payment for the travel days I’d have to do additional work of unloading the van which involved me going into the city and back with no additional payment.
Now because I did not come and unload the van the company will not pay me a travel day. My question is I have invoiced for the correct and agreed orginal payment but they have taken off the travel day. I want to know if legally they can do that? I thought you have to pay the invoiced amount?
First, I have to add I’m not a lawyer and you should contact one for legal advice. I’m simply a fellow freelancer offering tips.
What does it say in your contract? The contract is the binding document, so usually the courts abide by what both parties agreed upon prior to the job. Also, if you have any emails or other written communication prior to the change, save those to back up the agreed-upon terms.
Generally, if the company wishes to change the terms of the contract AFTER a contract is signed, you have the option of accepting the new terms, renegotiating the contract, or refusing the new terms and terminating your participation (you still get to charge for the work you’ve accomplished thus far in accordance with the original contract). It matters when they told you in relation to the travel days, too. You should keep all correspondence between the two of you over the changing terms as well. I don’t know if finishing the job sans disagreeing to the new terms is a tacit acceptance or not. And then there’s also the grandfather clause, and I don’t know if that applies here or not, either.
For your reference, an invoice is not a binding document, meaning just because you send someone an invoice doesn’t mean they are required to pay it. Otherwise, people would be randomly sending invoices to other people and they’d be legally forced to pay. The invoice itself is more for record-keeping and a reminder to pay as specified by the contract.
Does that help?
PS – Sounds like the company is a bit under-handed in changing their terms in the middle of a job.
All great advice. I’d add that in addition to our payment terms, we print on every invoice: ““Unpaid amounts past 30 days are subject to all applicable collection fees.” No one likes to have to go to court to get paid, but at least if this unprofessional situation occurs, we have a leg to stand on when it comes time to applying interest/fees/etc.
I love it! This takes the burden of collection costs off us. Putting this in my contract today!
Thanks for sharing!!!
One thing I’m learning is to not just put a deadline on payment once the invoice is issued, but a deadline on the return of proofs etc. I’ve had some projects that have dragged on and on because the client couldn’t get around to sending revisions. I have no problems with getting the deposit or getting paid once I send them the final, but sometimes I’ve done the majority of the work (the main design and a round of proofs) and then the project falls into a black hole for awhile. I need some language to add to my contract the will allow me to invoice for the parts of the work completed if edits aren’t returned in _____ (time). These are good, honest clients — just very busy. Thoughts?
I’m the same way – by far the largest time-suck in any project is the client getting information to me. So now I stipulate when the first proofs can be expected, or when the steps that I have total control over can be expected.
I find most clients don’t bat an eye over this, and when the project is waiting on them, all of a sudden it’s not quite the priority that it once was.
Now, for clients who drag the project out, I have a clause that goes, “Projects will be considered inactive after 4 weeks of client inactivity. Inactive projects will be billed for work completed.” Does this help?
Thanks for sharing!
Y’know, every professional I talk to says if there’s one piece of advice to adhere to, it’s to stay away from working with doctors and lawyers. I’ll add you to the list.
Sounds like you’ve learned some valuable lessons – hopefully your luck turns around soon!
Great article. Cheers to this.
I have never been employed. I came out of campus and ventured into freelancing… I had mentors in this field but some things you have to experience to learn. When starting out, i didn’t apply the deposit first rule… HUGE BLUNDER… I was new and didn’t have much confidence in my work. I once got a client through someone (sort of an agent) and when the job was done everything went silent. It got to a point I jumped the agent went to the client and asked if the payments were done. She replied and said she cleared it and even got a receipt . SHOCK ON ME… i had to go to the agent and demand my pay…FRUSTRATING…she said she will give me money for the logo and business cards. When I asked for the brochure pay, She said, THE CLIENT DID NOT USE IT, SO IT WONT BE PAID FOR… from then on, I learnt even simply securing a PDF design to send out might sound extreme but it does help when they call and say why can’t I print it out… you simply say, you have not cleared your invoice. 🙂
Then came the LAWYER clients… I learnt the hard way, that with this category, I just have to apply a 100% pay before the job starts.. The reason is this, graphic design is an important job just like any other. I take pride in what I do and i love it. No one has a right to take me for a ride. If you seek services from a lawyer they make you pay non-negotiable, non-non-refundable fees just to get at times a 4 line paragraph advice. So why then should they take me round in circles when it comes to them paying for my services?
Every-time someone seeks my services, 1. I state clearly my terms and conditions. before i agree to take on the job, I send out a detailed quote/contract stating what the client wants, How many (working days) it will take, how many samples the client will receive, EDITS ALLOWED and the final product, if in hard or soft copy. I then put in bold that work will commence after a 75% deposit. (This covers my running costs and a bit of my profit). Just when the job is about complete, i send my invoice to ask for the balance then after i receive it i send out the final work.
Then there are those clients who think that editing includes redesigning a layout. I once handled a client who kept making edits that kept making the design of the annual report shift. meaning every time I had to adjust 50 pages. Warn your clients in advance. It helps cut so many back and forth changes and you won’t feel short changed. Most clients don’t accept new invoices once they agree to work with you… ALWAYS INCLUDE YOUR COMPUTER TIME FEE when you do your costing.
For new freelancers, take heed of good advice when you get it to avoid frustrations that will make you want to quit the best job ever…
Recently towards the end of a project a client sent me an email headed address for brochures. The email just had an address.
Thinking this was to go on the brochure I added it to the back of the brochure. I emailed a proof and also posted a hard copy proof as the client was interstate at the time. The client okayed the brochure and it was printed.
It turned out that this was the address he wanted the brochures delivered to and should not be on the brochure.
He is now blaming me and refusing to pay.
Do you have any communication stating that they have the burden of okaying the final proof? That would be really handy for your case.
It’s generally understood that the client has the final responsibility of proofing their project. Did they email you an “okay to print” or anything that shows they expected the project to be printed as-is from the proof?
If you can’t prove that they signed off on the proof, you have a couple of options (depending on how you want your relationship to go and how much money we’re talking):
1) Demand payment, reminding your client that they have the burden of signing off
2) Offer to split the cost of reprinting the brochures
Good luck! Let us know how it goes.
Thank you for this great post April!
Do you have any suggestions as far as where I can start to draft a contract? I’ve run into issues in the past where a contract would’ve been more than handy and I just have no clue where to start.
Get Preston’s ebook, Contracts for Creatives! The content is worth tenfold the price.
Use Harvest and use the automated reminder, every 7 days as soon as they don’t pay in time. This really works, because 1. you don’t have to think about sending that e-mail or making that phone call, so little less to worry about 2. it gets on their nerves, while at the same time it doesn’t get in the way with your professional relationship – they know it’s automated and it looks very professional
Thanks for sharing, Kim!
Thank you very much for this information, it was very helpful!
So far I haven’t run into any invoice disputes. Here’s hoping that trend continues. Thanks for the article April
Hope for the best, plan for the worst. You’re lucky!
I’ve certainly never heard of any freelancer/independent contractor NOT going through this, at least once anyway! I wonder sometimes, if businesses and contractors realize how frustrating it is to have to send invoice after invoice with follow-up emails and potential phone calls only to either get no response or continued delay.
I too, now employ the “deposit down,” approach. It seems to help a great deal with getting the ball rolling and establishing a firm date/timeline.
I think it’s also important to establish a reasonable time table for payment once the invoice has been submitted…and to do this from the start of a project. This discussion might reveal that the client isn’t in a position to pay in a certain time period and then you have to make the decision to work with them or drop them all together. An example: ask/tell the client that you expect to be paid within a two week period and if not then a possible 10%-25% markup of the initial invoice total goes into effect after each week the payment is late. They might tell you, they don’t operate that way and they only pay once a month or something to that effect. This might just be too long of a wait…so it’s important to establish this timeline, either way, and could ultimately determine if you think it’s worth working with them or not.
Thank you for taking the time to write this post!
Setting a timeline for payment is excellent advice!
Thanks for sharing.
Good article! Invoice disputes are problematic for many small businesses, not just freelancers. And today, even the large ad agencies are fighting clients who drag out payment. (See AdAge: m/article/agency-news/p-g-stretches-time-frame-paying-agencies/241303/.) Always have a scope of work, explain key contractual clauses up front, and record and archive all client communications as part of project records. Everyone today seems to expect designers to work for free (for the love of their art, yadda yadda). Behave like a professional to be treated like one–your perceived value in the eyes of clients will be enhanced.
Great advice, Deb. And thanks for the article!
What about completing a job and final payment was a bad check? Called left messages no responses.
Getting a bad check is no different than not getting paid at all. If you can’t get a response from them, you have to decide if it’s worth it to pursue legal action. Don’t threaten unless you’re willing to do it.
If it is, send a letter informing them that they have a week to pay or you’re going to pursue legal action. You can also email them and leave a phone message to be sure they’ve gotten it.
If they still don’t pay, you’ve got to get a lawyer and go after them. It’s expensive, though, so make sure you’re doing it for profit, not for pride.
Good tips. I’ve also developed a ‘discount caveat’. We all have a rate card fee over and above what we are happy to earn, but it’s often pitched to allow some negotiation (we get paid what we want, the client feels like they’ve got a discount).
Well I always quote/estimate/bid at the rate card rate then put a line item in deducting the ‘discount’ and adding a note, “discount only applies to invoices settled within the terms agreed.”
This allows a friendly call a few days before the terms period ends to remind them to pay and keep the discount.
Of course, some clients just don’t care, and will delay and delay. When it gets stupid, I email the project manager and withdraw copyright and (as my clients are design agencies) tell them I will be approaching their client to recover the funds (allowable in UK). That really concentrates their minds!
The hardest thing is the designers get caught in the middle, the designers are lovely, and would always pay on time, but their accounts departments often have cash flow agendas we freelances often have to ‘subsidise’. Pity. Makes the job uncomfortable sometimes…
I like that idea – if they pay quickly, a discount applies. If not, they pay more. Excellent!
Thanks for sharing!
Wow, your experience is very usefu, especially when you just start and need to be sure the client pays, but as many are afraid to ask for the first payment. But I totatlly agree with you – first payment is a must in any work – it’s like insurance – everybody understands wh they need health insurance, the same thing is with the payment first
Lucky I live in a pretty honest town, the only payment I have never received is when I was told that the business cards that I designed for a start up business, went out of business before it even got started. I actually just let it go, I was sure that there were plenty of people taking this guy to collections and he only owed me 200. It was sad but when he told me that he couldn’t pay and all his savings was invested in lawyers I thought well you already got what you deserved. The man was hard to deal with and I had better ways to spend my time.
I always send low resolution unusable jpegs until I receive a payment. If they ask for a higher resolution I take the time to add a transparent PROOF to the file. It surprises me when people say they don’t use it so therefore don’t need to pay. I always explain to my customers honestly but kindly, its like asking someone to mow your lawn and then explaining that you went on vacation and never had a chance to use it, so you want your money back. When people see the correlation between labor and time they relate better, especially if the example used is something they have done before.
For just $200, it sucks, but it’s worth it to just drop it, especially since it’s very unlikely you’ll ever get it.
Using metaphors works so well – when you can relate to something they understand, usually they become human again and relent.
Thanks for sharing!
It’s a shame that you have to go to such great lengths to ensure payment for creative work! Generally, people wouldn’t try to get out of paying a plumber or a mechanic. And the fact that they would try to get out of paying for your design just because they chose not to use it. What do people think this is, seriously ?!
It would be interesting to know how different clients react when you request upfront payment. Does it effectively weed out the dodgy cheapskates ? Have you found that it influences the way they deal with you through the project, i.e. do they respect you/ your work more just because they paid for it ?
Almost none of my serious clients/prospects shudder at the down payment. The most wonderful thing about getting a down payment is the incentive to finish the project since money is on the line.
The cheapskates just don’t follow through, and they wouldn’t have anyway. I set my rates above the cheapskate pricing, anyway!
I forgot to do a contract with a lawyer and he decided that he only will pay me $200.
“I did not like your design/we are not going to use it” phrases are my favourite.
And the last case.. was a corporate design that I did for a “buddy” of mine and I don’t know why I decided to proceed without a contract. At the end of 3 weeks of work, he only paid me $500 of the $1800 owed saying that he will be giving me more ASAP.
I trust him, and waited… It’s been more than a month already.
He always gives me a date and time of the payment and he never calls and the money is never there. For the last 2 weeks, he had been ignoring my calls and giving me so many excuses about bouncing checks from payments from his clients and that he does not have the money. Then he starts using other people’s cellphone. I have even gone to his business to ask for the money & an explanation—always very politely—but it’s always lies..
I don’t understand why people don’t like to pay the money that the owe. It’s so unprofessional and gives a lot to say about your personality.
Unfortunately, not everyone has stellar morals and ethics in business. People, even “friends,” will cheat you in the name of business.
Lessons learned, huh? ALWAYS use contracts.
I may state the actual value on a invoice and would get paid up front, but another problem of mine is those that want to barter and I clearly state that I take checks and credit cards in my invoices.
Trading services is a popular way for new businesses to try to get services with a small budget. If you aren’t interested in accepting them, make sure you state that up front and put it in your contract that you do not accept service trades. This will stave off requests after work is done.
Really great article. Invoicing disputes are one of my biggest fears, and this article really helps clarify how to handle them. Thanks!
If I can offer one bit of advice, it would be to remain stern but fair. Clients are bound to miss an invoice or payment from time to time. Heck, we’ve all been there with bills ourself, we forget, get overwhelmed with work, or something else. Always be clear and consise with your agreements or contracts.
So true. Even good clients miss a payment, and it’s not worth ruining the relationship over one late invoice. Freelancing is all about more flexibility!
Thanks for sharing.
Many many thanks. I just got into freelancing and payments are usually a sticky issue, but your article has cleared all my doubts. Thanks a lot again.
You’re very welcome, Roy!
Great post! I really appreciate the advice on the usage clause. Adding that to my contract immediately!
That clause alone has really strengthened my contracts and it goes a long ways toward creating something your client actually uses! (It sucks to hear “oh, we didn’t use it.”)
Glad to help!
Again a very helpful article. So far I haven’t had any issues with clients since I’m fairly new and most clients are from friends of friends.
I was wondering if you were ever in a situation where it involved lawyers. Did you need lawful advice when it came to contracts/service disputes? Some of my previous professors recommended to get a lawyer, but when it comes to freelance is it possible that we don’t need them?
I’ve never had to employ a lawyer as a freelancer, but if I were to pursue a nonpayment legally I am prepared to consult with one. I do have a financial/business consultant, though. They can also help with contracts as well as do your taxes and minimize your tax bill.
If you need help with your contracts, I highly suggest you check out Preston’s ebook, Contracts for Creatives. The resources he provides are worth tenfold the asking price.
Thanks April! I will definitely check out his ebook =)
The best part about email is you can compose a letter and then NOT SEND IT. So my first rule of thumb is to write an email about an invoice dispute freeform. Then I let it sit and go back to it and remove all the emotion. Stick with the facts, using dates or old emails where possible, and lead the client through the process. Most times this will result in clients seeing their error and remitting payment, or you may even see an area where you dropped the ball and can offer amends (reducing the fee, another round of revisions to make it right, etc.)
Writing that (sometimes scathing) first email allows you to release all the emotional pent up pressure, doesn’t it? I do this, too. It helps me clear my mind and then get down to brass tacks.
Great advice, and thanks for sharing!
I do this sometimes and it really helps to get rid of my frustration, haha. Don’t forget to leave the To: field empty! (just in case).
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