Rant warning here. This has been brewing for a couple months now, and I just have to get it out of my system, lol.
There is this crybaby series of articles that Freelancers Union puts out that have been driving me a bit nuts.
Every ezine issue, they feature some sob story from a freelancer about how a mean, evil client stiffed them hundreds or thousands of dollars.
Omg, I’ve never seen a bigger bunch of professional victims.
And now they’ve got this ridiculous “Freelancing Isn’t Free” campaign to get some new laws on the books to protect freelancers from deadbeat clients, as if they themselves play no role in why they aren’t getting paid.
The one thing, the ONE SINGLE PROBLEM at the root of all of this is that these people can’t seem to grasp or get it through their thick skulls that as freelancers they are in business for themselves.
And business owners decide how things work in their relationships with clients. Business owners choose who they work with and who they don’t. Business owners determine what they are paid, when they are paid and how they are paid.
Business owners can either run their business like a business, or they can be morons. The choice is theirs.
What contributes to this mindset of idiocy and victimhood is the word “freelancer.” That word needs to be abolished.
In society at large, people don’t understand that freelancer is merely another word for business owner.
It doesn’t matter if you have a day job and do a little work on the side. When you are doing that side work, you are being in business for yourself and wearing the hat of business owner. There is no in-between classification. It’s either/or. One or the other. That’s it.
So when you’re working your day job, you’re wearing your employee hat and all the rules, laws and taxes that apply to employment are in play.
And when you work for yourself and hire yourself out to people, you are wearing the hat of business owner. Doesn’t matter if it’s part-time, full-time or just a little here and there; doesn’t matter if you use the term freelancer, independent contractor, self-employed or whatever—these are all terms for the same thing: BUSINESS OPERATOR.
The sooner you get that through your head, the better off you will be because THEN you can start running your business like a business the way you should be.
Let Me Demonstrate
There are some common themes running through all of these stories. Here’s an example from the most recent victim article. This “freelancer” says:
“In 2015, I agreed to do some editorial work for a client. The agreement was verbal and, because I trusted her to some extent, we did not have a contract. Shortly after I completed the agreed-upon work, she slightly altered the work I produced, claimed everything as her own intellectual property, and failed to pay the $500 she owes me.”
Her first mistake was not formalizing the agreement in writing with a proper business contract. Whose mistake is that? It’s not the client’s job to do that, it’s hers. And she made the choice not to use one.
While a verbal agreement is still a legally binding agreement, it does make it more difficult should you have to take things to court. So, when you are a freelancer, you are in business, and that means conducting business properly and using proper legal business contracts — upfront, every time, with every client, no ifs ands or buts.
The other problem here is that this freelancer’s client seems to assume that their business arrangement was a work-for-hire one.
This is another reason you always, always use a proper business contract. It’s why I always rail against work-for-hire agreements as well, which is different from a business contract.
When you blindly and ignorantly enter into a work-for-hire agreement you can be giving away all your intellectual property, which you may or may not have bargained for.
The work you do and the ownership of a creative work are two separate legal values. This is why they are stipulated and charged for separately. And ownership of a work cannot be given away without express legal written permission.
If you don’t know what you are doing, are using the wrong kind of contract, or haven’t had an attorney draft or approve your business contacts, you could be signing away all rights to the creative works and proprietary intellectual property that you created!
Because of these critical distinctions in the law, it’s imperative as a business owner for you to get yourself some basic intellectual property education.
For example, let’s say as a business, I have a client with a particular need. I end up developing a tool for that need that ends up being useful for any number of my current and future clients. I realize that I could license use of this tool to others and add a lucrative additional revenue stream for myself, and decide to put it out to market.
However, if I entered into a work-for-hire agreement with a client, that tool could actually be owned by them automatically. Meaning, they could be free to sell it or do anything they want with it, including telling you that you may not sell it or use it with anyone else, and that it belongs to them because you were in a work-for-hire agreement and anything you create in the course of working with them belongs to them.
How would that sit with you?
As a business, I am damn sure not going to hand over ownership of my creative works, inventions and intellectual property or proprietary processes lock, stock and barrel. That would mean I couldn’t continue to profit from them, use them with others, or in any other way adapt them for other uses.
Even if I was a mind to do that, I wouldn’t be giving away that ownership for free. Oh, hell no!
But there would be nothing you could do because you were the fool who entered into a work-for-hire agreement instead of a proper business contract and didn’t set the terms properly.
This is why it’s so important to NEVER blindly enter into any blanket work-for-hire agreement, or ANY kind of work-for-hire agreement in my opinion, and to use proper business-to-business legal contracts that contain the proper languaging and terms when it comes defining the relationship and who owns intellectual property.
Here’s another excerpt:
“Although $500 may not sound like much, I’ve put together many small deals for less than a thousand dollars. If all my clients were to behave this way, my life would be a constant nightmare of living in fear of being shortchanged. Though it may seem disadvantageous to go through the stress of chasing down a couple hundred dollars, that couple hundred dollars could cover my electricity bill, or even groceries for a couple weeks.”
Wahwahwah. Then don’t do things that way. You act like you were prevented from doing things any other way.
Wrong. You made a choice.
On top of running your business like a business and using proper business contracts, upfront, every time, as a business you also have the CHOICE about who you work with.
Vet your clients properly. Put them through a consultation process so you have at least some idea of who you are doing business with and what they may or may not be like. You get to screen and prequalify clients as a business owner.
A proper consultation can help alert you to red flags that indicate someone may not be worth working with.
Stop rushing or bypassing these vital and important business protocols which also, by the way, help clients understand the CORRECT nature of the relationship and give it proper professional respect. These steps play a big role in setting the stage to make sure you get paid, in full and on time, every time. HUGE!
Likewise, who says you have to wait until work is done to be paid? You can charge the full fee upfront if that’s what you want to do. It’s a perfectly usual, legal, established standard business practice and option.
You can also split a project into phases with the payment for each phase due upfront before beginning work on any next phase. Or, you can charge a deposit or a percentage upfront.
Mitigate your losses if you are taking a chance on a client you don’t know and have never worked with before by getting some kind of payment upfront. Likewise, they’re going to take the business more seriously when they have skin in the game.
There Don’t Need to Be Any New Laws
There are already laws on the books to protect you in these matters and you’ve always had the choice to avail yourself of those recourses.
The problem is being a business moron and not conducting business according to how business is conducted.
It’s that YOU don’t understand that as a freelancer you are a business, and that YOU define these things in your contract that you should have been requiring clients to sign upfront.
You’re not a temp, you’re not a “contract worker.” (Tip: A contract worker is an employee, not an independent self-employed business owner.)
Stop letting clients tell you how things work in your business.
And stop accepting “positions” with companies that should be paying you like an employee but instead are stealing from you by illegally classifying you as an independent contractor. (Hint: Business owners don’t work in positions; that’s an EMPLOYEE.)
If that’s what they are doing, turn their asses in to the IRS and your state Department of Revenue and Employment Security Department.
Because if you really are an employee (which is determined according to the federal laws that define these two distinctions and which employers don’t get to just decide arbitrarily), then they are stealing from you your rightful wages and employer-paid share of taxes and benefits.
By not understanding these distinctions, by not educating yourself, by willfully disregarding these things, YOU are equally guilty of perpetuating the problem of deadbeat clients.
Stop being a bunch of wishy-washy, crybaby pushovers who whine about being victimized all the time. You have the power and the choice to do things differently!
Sure deadbeat clients are shitty people; there’s a special place in hell for them. But guess what? You allowed them to treat you that way by all the choices you made.
No one can take advantage of you without your permission. Stop acting like a victim and like you had nothing to do with it, and start running your business like a business.
Take responsibility for the choices YOU made to not run your business like a business, rushing processes, not conducting proper consultations and due diligence, choosing crappy clients, not using contracts, and not getting at least some money upfront. It’s really simple.
Until you take responsibility for that, nothing in your business and life will change.
And listen, I don’t mean to be picking on anyone personally.
It’s one thing to be new in business and learning the ropes and making newbie mistakes. There’s a learning curve. We’ve ALL been there.
Beyond that, though, there is just too much information out there any direction you look to remain ignorant long. These aren’t people who are new making these dumb choices; these are people who knew better and what they should have done and chose not to do it.
I’m equally annoyed with organizations like Freelancers Union that don’t do their job as a professional organization which should be to properly educate their members and the marketplace, so the stupidity continues.
Because 99% of these problems wouldn’t exist if these people understood how business works, how it is properly conducted between two businesses, and that as freelancers they are business owners (not “contract workers” or employees).
I’m sick to death of all these whiny articles collectively because they don’t empower anyone, they just keep them acting like victims who blame others for their problems and many of whom are going to keep doing the same bone-headed things over and over.
Want More Dissections?
Here’s another example:
“Because I knew and trust my contact in NYC, I went ahead and started work without a contract, though I did send my salary requirements and scope of work via email for their records. I was told the contract was in the works.”
Same ol’ song and dance. You don’t do business without a contract and you don’t start work until that contract is signed and everything is agreed upon.
The other problem here is this freelancer uses the phrase “salary requirements.” Um, business owners – which again, is what freelancers are — are not paid a salary. EMPLOYEES are paid a salary. Someone who is in business for themselves charges a fee or rate and tells the client what, how and when they are required to pay, not the other way around.
“I proceeded to organize vendors, source supplies, find caterers, etc. There was some drama around whether to have the launch party in the office or at a venue nearby. They changed their minds about 6 or 7 times. The indecisiveness was alarming, but I rolled with it and did my work. The entire time I kept asking for the contract.”
You should haven’t kept asking. You should have stopped working and told them that the contract was required before any work was to begin or continue. Period.
This also hints that there was either no consultation conducted or it was a sloppy, not very thorough one. Otherwise, you could have established all the specifications about how the work and decisions were going to be made, who the ONE contact person was that you would be dealing with, etc., and avoided all their internal drama. There is no reason you needed to be part of that.
“Finally, the week of September 21, the majority of the folks from Europe came to town. I had a few meetings and eventually received the contract. The rate was correct, but the terms and conditions were way out of line. I wasn’t about to agree to a six-month non-compete and 90-day payment terms. It just didn’t make sense for the scope of my work! So I redlined the contract and sent it back.”
So let me get this straight, you let them write your contract for you? Ridiculous!
You’re the business owner; your contract is YOUR job. You don’t abdicate that responsibility to clients. Your business requires YOU to set the terms. Clients have only to agree and sign or suggest changes. Or you don’t do business together, simple as that.
Instead, you let the client treat you as if they were your employer and it was their role to call the shots here. WRONG. And stupid. NOTHING should have moved forward until the terms were finalized and YOUR contract signed by the client.
“At this point, I was told that I was only hired for the month of September and not October. They hired an office manager and I was to give her a download on everything I had set up, which I did without complaint. I was now a week out of the job and still hadn’t received payment. When I followed up, I was told there was an issue with my invoice and that the company wanted a work log. I had never been asked to submit my hourly tasks and my rate was a day rate. Furthermore, I had clearly stated overtime fee after an 8-hour day.”
This person clearly doesn’t understand that she is not an employee. She uses employment terminology, lets the client operate as if they were her employer and isn’t understanding how she herself is allowing the lines of employment and business to be blurred.
You aren’t “hired” by clients, you are “engaged” by them. And you don’t get “overtime” as a business owner. Overtime is something employees are entitled to, not business owners.
Instead, business owners stipulate IN THE TERMS OF THEIR BUSINESS CONTRACT BETWEEN THEMSELVES AND THE CLIENT when late, rush or after-hours fees and charges will be incurred.
If you don’t want to be in business for yourself, and you are working with a client as if you are an employee, then you ARE an employee, and they legally need to be putting you on payroll and adhering to employment laws.
On the other hand, if you do want to be in business (which you are, automatically, if you work for yourself at any time), then you have to run your business like a business. There just isn’t any way around this.
But here again, this is yet another freelancer who doesn’t understand that they are a business owner and is letting a client operate with the mentality that they are some kind of employer and dictating things to her, which they have absolutely no legal right to do. She abdicated her own business responsibilities and now that she’s having problems with them is her own damn fault.
I know YOU are going to be smarter in your business, right?
PS: If you want to save yourself these problems and learn how to conduct business properly, be sure to also read my article How to Avoid Getting Stiffed on Payment
Wow, your rant was worth every word. People either don’t research issues or situations best to practice or to avoid as a “business owner” in their industry, or they are simply ignorant and shouldn’t be in business at all.
Very Well Said! True to every point.
Good article, Danielle, and one that should be read by many.
Too often people decide it’s easy to “do their own thing” while working under the mindset of an employee, i.e., the client should take care of all the “legal” work.
Or something I’ve seen frequently, they take a contract used in a business in which they’ve been an employee, and try to use those terms, which often have nothing to do with the business the freelancer is trying to run.
And like you said, if they really want to do things to protect themselves, there are many options to be found online, either through your organization or others. The key is to take what’s available and make it fit their own business, because each of us provides things just a little differently from everyone else. That’s how we market, and that’s how we should be perceived.
This rant was well worth every letter, word & syllable.
If you want to be respected and treated in a professional manner then you must act like a business professional. Never start work or even promote potential ideas with a customer without using your documents- whether a contract or retainer agreement, scope of work, invoices etc. Remember that even your phone consult is time being spent and time is money.
Great article, Danielle. You are 100% right. People need to take responsibility for educating themselves and then take responsibility for their choices and actions.
Love, love, love!
The points in this article cannot be overstated. Your level of success is largely dependent on how you conduct business. It is the responsibility of the individual to educate himself on possible liabilities and legalities involved in order to implement methods that will mitigate possible losses. Thank you spreading the knowledge Danielle!
Here’s another excellent example:
Came across this paragraph on yet another Freelancers Union article:
“Any client, however, that you’ve worked with in the last year is fair game. Clients with whom you were particularly chummy may go back even further, especially long-term clients… but be warned that they may be less specific than more recent employers.”
Client are not employers, PERIOD. These two words are not interchangeable.
There is simply no room for sloppiness and inaccuracy like this. These are fundamental principles that they simply must get right or they themselves are responsible for the perpetuation of deadbeat clients, clients who think they are employers, and business owners who think they are some sort of under-the-table employee (which is illegal).