Client won’t pay, my final resort
pixxel.co
pixxel.co
The person/people I'm emailing never ever know that there's absolutely nothing we can do at a technical level to stop the component working. They say "oh my, please please enable it". Well, if you pay, sure. Payment comes as fast as is humanly possible.
In the case of design, my assumption (correct me if you've tried it and it doesn't work) is to retain copyright of the material until full payment is made. Prior to that point, you license them to use the stuff and only assign copyright when you have all the cash.
If you use a copyrighted material in a manner you're not licensed to do, you are committing copyright theft in most countries you'd do business with, and that is the legal infringement that would form your case.
My solution, which I'm not particularly proud of, but have found necessary, is to ensure it's possible to stop the component from working until I've received payment.
Typically, I do this by having an obfuscated statement embedded somewhere in the client's code which does a quick phone home to my web server. When they pay, I remove it.
I've never had to wait more than an hour after pulling the kill switch to get a response.
It is lying: you say legal action is underway. You've done nothing but mail a letter. The moment someone says legal proceeding are underway, the other party needs to shut up, and refer all communications through attorneys. At that point, you'd probably find yourself needing to hire an attorney at considerable expense.
I suspect you could be sued for defamation: claiming legal action when none existed can harm reputation. If you're not a business entity with personal protection (such as LLC or corp, depending on your locale) they can destroy you financially: house, property, bankruptcy. No client is worth that to me.
Even if you were to sue, this website might work against you. It'd definitely come up in proceedings, and may cause the judge to grant some leniency even if your client was ordered to pay.
The warning site doesn't identify you, so if the client could care less (people launching (companyname)-sucks.com all the time), they'll just ignore you. Then you're out hosting and domain fees.
If the client goes the cybersquatting claim route, they can take the warning domain, and you can levied fine of up to $100,000 USD. (http://en.wikipedia.org/wiki/Cybersquatting#Legal_resolution)
Glad it worked out for you, but I think you're correct in your warning that no one should ever do this.
As in, I'm starting to look for an attorney to explore my legal options. This one works in residential construction also ("I'm beginning the process of finding a lawyer to speak to about putting a lien on your house." I knew it wasn't legally possible in most situations, but I was definitely allowed to ask my lawyer again).
"Mr. Lawyer, can I ask you a couple of questions?"
"Yes. What is your other question?"
Bringing up a domain to criticize a company is not cybersquatting.
This is not necessarily lying (provided you have inquired about your options with an attorney).
This is not defamation.
This is not cybersquatting.
At best, this is stupidly prone to unpredictable backfiring that makes you look ... stupid. At worst, you look like a dick and the word spreads.
I tend to use psychology with late paying clients. I say things that affront their ego about not being able to pay. Things like "looks like you're short on cash, business not going so well?", or jabs about their accounting department. Also I harass them about the invoice the first day its overdue, and everyone I have contact with is CC'ed especially the CEO if I have contact with them. I'm the nicest guy to work with, but when it comes to payment I'm a real asshole, and I let them know it.
A lot of times late payments are simply the accountants managing debt by putting freelancers, who typically don't charge interest or have collections mechanisms, on the backburner in favor of paying off vendors or lenders with steep interest rates. Introducing late payment fees, and reminders of those fees tends to expedite the payment in that case
Then I realized that in the real world that's probably quite a while to wait.
I'm accustomed to dealing with government where 4-6+ months is typical and complaining will see you blacklisted. This is part of the reason huge companies are able to rent seek on such work, many small to medium businesses would have a hard time floating 6+ months of payroll continuously.
We'd be ecstatic with 30-60 day schedules and I wouldn't consider "Your services are no longer welcome here" to be a desirable "response".
>"This sounds like a different situation."
Obviously.
| I wouldn't consider "Your services are no
| longer welcome here" to be a desirable "response".
Obviously the best situation is you paying on 60 days (or more), but being paid on 30 days (or less).
Someone chasing the invoices and getting the money is worth it if you have tardy payers.
Most likely I'd presume that I'd submit the bill on the Xth and the money would be sent back somewhere between the 1st and 5th of the next month. That's very standard for smaller businesses[1]. In other words, you might wind up with 6 weeks between invoicing and payment. You might find that they pay on the 15th instead of the 1st. Big whoop.
4-6 months is outrageous and amazingly uncommon.
[1] My father's a general contractor in construction; he's dealt with a ton of businesses of a variety of kinds and this is the SOP.
AIGA have a very useful, free-to-use invoice you can use for design projects: http://www.aiga.org/standard-agreement/ (although it's perhaps a bit more heavy-handed than what I use for consulting agreements).
The memetic video on this topic:
One suggestion I would have made would be to remove the "you are clearly avoiding contact with me" line, as contributes nothing to the threat, and it makes a huge assumption which you have no way of knowing whether it's true or not. And how bad would you feel if they came back with a truly legitimate reason for not getting back to you, like maybe your contact had a death in their immediate family and took a 1-month leave of absence?
I can't tell you how many times I've misinterpreted tone, action, or inaction over email, text, and telecommunications. I've finally just learned to stop trying to guess a person's motivations or tone within any medium which leaves out so much context.
Clients can ignore payment even when there's a clear agreement and payment plan place in place prior to starting work. How? Not paying.
I wouldn't care. Contracts are binding, so fuck you, pay me.
[1] http://www.apple.com/legal/internet-services/itunes/appstore...
Same way as if I pick up a copy of windows from a shop without paying or figure out a way to download a valid windows license without paying - I don't have the license as I never actually paid for it, regardless of any agreements Microsoft might have written in the box about the license.
His way of solving the problem sounds awfully close to blackmail to me. Sure, he deserves to be paid but is that the right way to go about it? Start with a contract, deliver final product upon receiving the final payment etc.
I know that it is not always possible to wait with shipping until you have been paid but, depending on the client, it should be in most cases.
Contract implies you also need a stick which is legal action. Obviously depending on the amount of money involved that might simply not be an option.
While not entirely relevant I will bring the following into play, a saying, that goes something like "if you owe the bank $10,000 you have a problem if you owe the bank 10,000,000 the bank has a problem".
For example (IANAL and everything):
In germany, if a client hasn't payed an invoice without challenging it, you can get a court order for payment pretty quickly. The legal fees for this are quite small and paid by the client. All you need is proper documentation of the process.
Clients avoid this like the pest, especially if their complaints are not expected hold. Once the court started dunning the other party, most ways of negitation are lost.
The first thing I tell clients is: "if there is any problem with invoices, speak to us immediately, if you don't respond we will go the direct legal route."
This happens rather often. Most of the time, clients are silent because _they cannot pay_ because of miscalculation or other reasons. Sometimes, they are ashamed because of this. So they try to sit it out until better times - which might never come. Talking to them about paying in slices etc. often helps. But often, you need to bring out the big threats to even get them talking.
Also, in any case: if you have the slightest doubt that a client goes towards insolvency, push this as far as you can, especially on the legal side. Insolvency will mostly be handled by order of creditors - try to get your title before everyone else. This might seem hard on a personal level, but this is how it works.
For all this, you often don't need a contract as long as there is documentation of the process. A signed offer by the client goes a long way.
A detailed contract with further ways is always good in that regard (and should _always_ be in place), especially when it comes to licensing or for clear payment terms. E.g., it handles the following scenario:
* A client enters insolvency
* It is decided to sell the assets of the company (including the almost-ready software you produced) to a third party (a classic firesale)
* Some other creditor has preferred rights to the money, so although your client has money now, it is for someone else.
In this case, a contract that regulates that the rights to said piece of software are only the clients once the final payment is there means that the buying party and your client _have to talk to you_ or the deal is off. That could mean that they have to pay you to make the deal happen, giving you preference over all other creditors that want the money out of that deal. And buyers are really careful about such stuff, because anything else involves uncalculatable risk (including you making them loose the full rights on the thing they bought). No legal action on your side involved.
I am in the freelancing business for quite a while now and I never took legal action. But I often threatened taking legal action and you better have grounds to back that up and make the other party see a risk to be on the loosing side.
Thats the other advantage of contracts: threatening with legal action cannot be seen as extorsion because it works though proper channel. Don't fear the legal system, use that other people fear it.
Also, as hard as it may sound: never enter business relationships that you cannot pay the legal costs for.
"never enter business relationships that you cannot pay the legal costs for."
More or less would indicate not to enter into a business relationship that is very small which of course does make sense since the amount you would lose is very small.
"you can get a court order for payment pretty quickly"
Can't speak for the UK but have won court orders in the US. Doesn't mean you will actually get money. Could be entity folds or further delays. Or there are extra time consuming steps required to get the money. Once again, at least in the US. Also in us something called "confession of judgement" but once again can't get blood from a stone or a moving stone.
"clients are silent because _they cannot pay_ "
Exactly. No money doesn't matter who is compelling what.
"don't need a contract as long as there is documentation of the process. A signed offer by the client goes a long way."
Agree. A contract is an agreement. Can take many forms and be ultimately enforceable. Doesn't have to necessarily have a degree of formality either.
"But I often threatened taking legal action"
Would say thought that one thing to consider is that in certain organizations threatening legal action can be seen as a bluff or simply make the recipient able to pass it off to the legal department where it's not their problem anymore and all motivation to settle is lost. What I have found that often works is to be a "pain in the ass" where the person simply wants you to stop pestering.
On threatening: yes, sure. True professionals will invoke lawyers once you speak about them. Tread carefully, most of the times you don't want that.
> Things have changed since I first started out. I now have systems in place to better protect myself and the client. When I first started out I didn’t have a contract in place or a document outlining deliverables. You live, you learn. It could still happen again but far less likely.
On rare occasions when I have been ignored like this, I have sent snail mail saying I will start charging late penalties - as I am legally entitled to - if I don't receive payment within 14 days.
I have never had to wait out those 14 days, so I can't offer anecdote beyond that.
Details: https://www.gov.uk/late-commercial-payments-interest-debt-re...
You're telling your client that either they pay you, or you will post defamatory information about them online. While, the information posted may be true, depending on locale it may not matter how true (or false) the remarks are.
> The final invoice was sent one week ago and you have not received payment.
> You attempt to Skype but the client is offline ... perhaps they are on holiday or a family emergency arose.
To me all this says is that this guy is working with mostly individuals. I know we all like to make ridiculous payment terms ("pay me within 48 hours or I'll apply 1.99% interest every 12 hours for 1 week then persue legal action") but in the real world you cannot demand payment within 7 days. Any client of size is doing to take at least 21-30 days to pay. Most will pay within 30. Some will not sign anything that requires payment in less than 90.
> A month has passed. It is now clear that you are being purposefully ignored.
No, it's not.
> Perhaps the client lives in another country so legal action is out.
In truthfulness, I tend to shy away from foreign clients for this very reason. I have no recourse if things go seriously south.
> Legal action ... is underway.
This is downright stupid. If I contract someone to do something and they tell me they're persuing legal action against me, that is the last time I ever speak to them without my attorney in the room, on the phone or cc'd. If your goal is to get paid this is the stupidest thing you could possible do to get that check.
Also, it's just not true. Buying a domain and putting up an HTML file does not constitute legal action. Let's say you take this to trial. What happens next is their attorney shows the jury or judge that you were threatening legal action and saying you'd already taken it days or weeks before actually doing it. You were lying while trying to get money out of his or her client. What else have you lied about?
> As a webmaster I will use my considerable SEO skills to ensure that pigclient-warning.co.uk is the first search result
This is extortion. It's illegal and if I got this I would hire an attorney and make sure this find its way to the inbox of whatever law enforcement official it has to.
> To end this today you could pay my final invoice and I will immediately remove the page. ... I have attached a revised final invoice to include the cost of buying [the domain] plus a [50 pound] admin fee."
Also extortion. You do not have the right to just arbitrarily decide they now have to pay you $50 because you had to write a snippy email detailing how you've broken the law a handful of times.
> On both occasions I have received payment within one hour.*
Which goes to show you what kind of clients you work with.
> I have always resented having to stop to that level
You should.
What blows my mind is that at the very end he admits there may well be legal ramifications for doing this.
Non-paying clients should be built into your pricing. Credit card transaction fees have a certain percentage of fraud built in. Everything does. If one client paying 60 days late or not at all destroys your business, you need more clients, you need to charge more or you need to get someone that knows what they're doing to help you with the business side. Probably all three.
Blackmail when someone threatens to reveal information unless a demand is met.
Regardless of whether blackmail is illegal, I'm interested in why you think it's immoral?
That said, it is probably better to avoid being near murky lines.
However, should it actually get to a courtroom, it would not be good to have to address a judge and jury and explain that yes, you spent weeks lying to this person, threatening them with material harm to their business, etc, but that's the only thing you were dishonest about in the whole ordeal.
In some european countries the client will simply sue the OP for damaging his reputation/business interests and the damages he'll claim will be considerably higher than the money he owes. On top of that, this can be considered extortion.
1 unreturned email/phone call: 70%
2 unreturned emails/calls: 95%
3 unreturned emails/calls: 99.9%
And the first one honestly is probably even higher than 70%
I would check into whether the "if/then" creates a case of extortion. (I don't know the answer but it pops into my mind).
That said, even if does (and this is really important although legal opinions might vary) did legally create a possible problem you still have to weigh the chance that the person on the other side is going to pursue that angle or just pay up. [1] I make this point because there are plenty of things that you do in business that aren't 100% defensible but in the end they work and you move on (after taking your chances).
[1] Based upon my many years in business taking chances with things quit frequently. After all people bungie jump, sky dive and do extreme sports because of their judgement that the gain is work the risk.
Here's my documented version of to-do's to avoid such awkward situations.
1) Always let the client know through email that whatever NDA or any other form you've signed is valid only after the project is complete(ie., the final invoice is paid). But, however, promise them that (legally) you will not leak anything about their project anywhere else until unless it goes too extreme, as in your case (add this clause, it's important). I say email specifically because it can be used as vital evidence if something goes wrong.
2) If it's just PSD's, watermark them in a way they will need to spend more time and money removing watermarks and editing than paying you.
3) Copyright. In your email to your client, the first thing you let them know is that the whole stuff belongs to you (owned by you, copyrighted) unless the final invoice is paid. So make sure the NDA doesn't mention/over-ride this before you sign it.
4) Many are against this tactic, but I will explain the reasons soon. Include a flipswitch.
Here's how -
If you are doing HTML/CSS, this is how you do it (I've already suggested it before):
Add redundant containers - I'm using the logo as an example, but really it could be some important element that provides value to the client. As an example, if you want to add styles for your logo, don't just write it as
#logo{
display:block;
position:absolute;
top:10px;
background:url('some-image.jpg') no-repeat;
}
#aw469srfa #fewji903{
display:block;
position:absolute;
top:10px;
background:url('some-image.jpg') no-repeat;
}
$(document).ready(function() {
//do a check to see if current time is less than expiry date
if( project_expired()){
$('#aw469srfa').html('<div id="fewji903"></div>');
}
else{
// don't load the container
alert('fuck-off, expired');
}
function project_expired(){
//do something to check the validity
if (current_time==time_you_set_to_expire)
return true
else
return false
}
});
Now:
Minify your CSS and make it unreadable. And finally, obfuscate your JS above:
This is how the above code, when obfuscated will look like this somewhat:
eval(function(p,a,c,k,e,d){e=function(c){return c.toString(36)};if(!''.replace(/^/,String)){while(c--){d[c.toString(a)]=k[c]||c.toString(a)}k=[function(e){return d[e]}];e=function(){return'\\w+'};c=1};while(c--){if(k[c]){p=p.replace(new RegExp('\\b'+e(c)+'\\b','g'),k[c])}}return p}('$(a).b(2(){5(0()){$(\'#9\').8(\'<1 6="7"></1>\')}3{j(\'h-i, c\')}2 0(){5(f==d)4 e 3 4 g}});',20,20,'project_expired|div|function|else|return|if|id|fewji903|html|aw469srfa|document|ready|expired|time_you_set_to_expire|true|current_time|false|fuck|off|alert'.split('|'),0,{}))
At that point, your client could:
1) Reverse engineer the code to see how it works.
2) Try to re-design it from scratch
3) Cancel the project, or take too much time to complete it.
4) Pay you.
1-3 are extremely time-consuming and expensive for them. So, most likely, they will opt for 4.
Now for the DON'T's.
1)DO NOT obfuscate your code in production. This is only done till you get your final payment.
2) Remove all the shady tricks above in production (once you've received your payment) because it's
a)unprofessional and
b)most likely would break something.
This is not perfect. But you do understand that any locksmith can break your house door, right? So, this is for those non-tech clients who would rather pay when you push them too far..
This has worked really well for me all these years.
function project_expired(){ //do something to check the validity if (current_time==time_you_set_to_expire) return true else return false }
Maybe you just want:
return current_time==time_you_set_to_expire;
O_o
Also note this is really easy to circumvent.
(Edit: I am a not a designer so I'm not sure how many "stages" you can break a contract into)
Would any freelancers pay for that?
Won't any mildly tech-saavy client want to try it on their laptop, phone and/or tablet to make sure it looks right in different browsers? Well, it'll look exactly the same, because they aren't actually rendering it....
The minify/obfuscate solution seems sufficient (and possibly an expiration date...) but even that would be obviously unnecessary with many clients.
When final payment is received, final deployment occurs. Until then, it can be accessed via a URL you control.
Otherwise, if you're really looking for something like that, I'd suggest https://forwardhq.com
I was speaking more to sensible protection--do not deploy & resolve DNS, do not transfer source code ownership, do not relinquish copyright ownership, etc. until the final invoice is paid. And make sure it is written that way in a contract and that the client signs the contract before work commences.
The better thing to do is have a contract, and if the client doesn't pay, have a lawyer send a threatening letter warning them about contract violations and court action. That should work almost every time, and if it doesn't you'll already have a lawyer familiar with the situation.
For bonus points, have the contract gone over by a lawyer before signing it in the first place. There are law practices and legal services businesses that specialize in it and it only costs a few hundred dollars. And it can be added to the cost of the project.
1. The money owed is significantly more than the incurred legal fees.
2. You work in a place where courts are actually effective.
For number 2: This seems like a reasonable assumption to make for the majority of people reading HN. It's ridiculous to promote a weird, probably illegal, blackmail scheme because a dozen people on HN can't use their court systems.
Most countries have low-cost fast-track law for this kind of situation. In the UK it's "small claims". Seems like a start up could make some money offering non-legal advice about how to use these simple cheap courts to get redress.
If I was starting contract work for a new client, I would ask them to pay up front by the day. It is trivially easy to set up a one-click "pay for 1 day of work" button with Stripe (saving credit card info after the first payment) so it should not be a huge burden for the client.* I would eat Stripe's fee in exchange for peace of mind.
Note that this is good for the client too: hypothetically, if they don't like my work, they can pull the plug without being on the hook for future work (if I do my job right, this will never happen).
* Some corporate client's can't do this because of rules about what can go on a credit card. That's fine because those bigger businesses are generally used to paying invoices on time in my experience.
Better yet, watch that video now, hire a lawyer like every other freelancer on the planet and avoid such a mess entirely!
- Make things clear in the start, the workflows and Billing process.
- If you get small hints of late payments or slow payments, just stop the work for some time.
- Keep Milestones and proceed one step at a time. We follow checklists with all our clients at ninjaas.com
- Only after your final payments are cleared, consider moving code-base to the production servers or give them the access keys.
- Don't ever get nasty with any client.
If things got wrong, maybe it was your own mistake in the first place somewhere? You missed gathering requirements or something better be done next time to avoid such steps!
Finally Learn the process: We've learnt these things the hard way. There is no general formula. :)
PS: PigDesigner is not a reference to the OP in any way. I do not know the OP. Just saying that either side can bite.
Maybe he should reword his letter and don't use that domain name. And make it so that he is just providing a review on his experiences of working with the client. And also could put it in his personal website.
2011/03 Mike Monteiro | F*ck You. Pay Me.
I still remain unpaid.