“Anybody who is in freelance work, especially artistically, knows that it comes with all the insecurity and the ups and downs. It’s a really frightening life.”
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Whether you’re a writer or just someone who makes vector packs for a living, being a freelancer is a tough job. It’s definitely harder to work freelance than in a company. When you work in a company, you work for someone else, and it’s not your job to worry about getting clients or dealing with legal details – it’s that persons’ who you’re working for.
When you work freelance, not only do you not get a steady paycheck every month, but you have to start finding clients, you have to start dealing with those clients personally (which can sometimes be a terrible experience that working in a company may shield you from), you have to start worrying about customer reviews and signing contracts for every little job you make and you have to deal with creating a work schedule that isn’t too loaded or too lax.
Like I said, it’s a tough job being a freelancer. If you’re already seasoned by years of experience with working freelance, then you already know the importance the contract has. When you first start out, contracts seem like a lot of hassle, a lot of scary legal binding stuff and a whole bunch of paperwork you don’t really know the first thing about.
So you may be tempted to skip the whole contract signing part, just do the work and get paid. Unfortunately, when you try this out, it seldom works out the way you had expected it.
Contracts are there for your (and your clients’) protection. Without a contract, who’s to say you’re not just working pro bono and just don’t know it yet? Whether it’s that or just an unreasonable client asking for a bunch of free changes that wind up taking double the time it took to complete the project the first time, it’s most likely you will have a sour experience when trying to cut out the contract bit of the freelance life.
That’s why you need to learn how to handle the legal aspects of being a freelancer. Nobody knows this stuff when they’re just starting out – there aren’t that many freelance lawyers out there, are there? The only way you’re going to start to know this stuff is if you research it. Even then, though, it can turn out to be pretty frustrating and confusing.
What follows is a list of tips & tricks you need to know when handling the legal aspects of your freelance business.
1. Have a Terms of Service Agreement
This is a crucial aspect of your freelance legal work. Once you’ve gotten your client to sign your Terms of Service Agreement, both of you are contractually bound to respect that framework. You will have to provide what you said you will, of course, but they won’t be able to ask you to do more than the agreement stipulates, nor will they ask you to do it for any less.
Basically, a Terms of Service Agreement is a document that shows exactly what you expect from your client and what your client should expect from you. It is your best safeguard against bad projects or bad clients and you should use it accordingly.
2. Get Your Billing Structure in There!
Your client needs to know this from the get-go and it should be stipulated in the Terms of Service Agreement. Let them know if you bill by the hour or by the project. Tell them how much they can expect this particular project to cost. Agree with the client on what your final estimate should include and what will happen if changes are required beyond what the initial project entailed.
3. Plan for Late Payment
Determine a grace period in which the client can pay you after you’ve invoiced them. Usually, the grace period is 30 days, but it’s not set in stone. You choose what you find works best for you and your clients. If the client hasn’t payed by the end of the grace period, you should set up late fees and penalties or interest rates for late payments. That will make sure your clients will pay their dues sooner rather than later.
4. Interim Charge Caps Are Your Friends
When you have a client that has you working on either one huge project or several smaller projects that add up to a large amount of cash, make sure you don’t expose yourself to lose too much of your work should the client just decide not to pay you. Set up a cap of how much your client can owe you at any given time and state it clearly in your Terms of Service Agreement.
If the cap has been met and the clients don’t pay it, cease work on anything you do for them until they pay you. This cap is vital when working with new clients especially and you can waive it if you’re working with someone you have had a history with and whom you completely trust. Otherwise, keep the cap, it’s for the best.
5. Just Say No to Speculative Work
Speculative work is when you do actual work in the hopes of impressing a client enough that they will hire you on another project without any tangible guarantee of payment or of retaining the rights to your work after you’ve turned it over should it not be paid for.
It’s just bad practice to do this and clients will keep doing it as long as freelancers put up with it. Realize that your time is limited and precious and just refuse to do any spec work, ever. Spell it out in your agreement.
6. Don’t Get Stiffed By a Discontinued Project
Whenever you submit a first draft to a client, there is a chance that they will just plain not like it at all and that they’ll want to stop working with you on the project. When they say this, if they’re honest, your clients will pay you for the time you spent working on the draft. Still, some clients may want to weasel out of payment or, even worse, to use your ideas for free.
In order to avoid this situation, you should set a minimum rate for work that you’ve done and that was immediately rejected and where the client wants to terminate the contract with you. You should stipulate that, if they’ve rejected the work you’ve done, the client may not use it, either in whole or in part.
BONUS: 4 Excellent Legal Resources for Freelancers
1. Creative Commons – If you haven’t heard of Creative Commons by now, you definitely need to read up on it right now. What it is is a great free service that helps you with all the legal aspects of copyright (restrictions & freedoms) of your works. Their service and software are easy to use and they’re essential for anyone looking to protect their intellectual rights on their work.
2. The Electronic Frontier Foundation’s Legal Guide for Bloggers – If you’re a blogger, this is a resource you definitely need to familiarize yourself with. It’s basically a summary of blogging law and U.S. law that addresses everything from fair use to free speech and privacy. Now you can know for sure what you can blog and what you can’t without getting in trouble.
3. The U.S. Copyright Office – If Creative Commons is a great resource on securing your works and your copyright, this is the definitive resource on copyright law. While your work is copyrighted as soon as you publish it, the U.S. Copyright office is where you can register it for further protection. This, of course, is in exchange for a fee.
What is free, though, is their FAQ section, that is one of the best copyright guides on the internet. You definitely need to familiarize yourself with it if you want to pursue a freelance career in the creative industries.
4. ContractPal – Contracts for jobs come in all shapes and sizes, from the simple work order that specifies what you have to do, when you have to deliver it and how much you’re getting paid for it to the more complex documents some companies and contractors prefer to have in place that address issues like liability and non-payment.
ContractPal is an outsourcing site that helps you go paperless and optimize the document flow between you and your clients, thus enabling you to focus on your work and not on its legal aspect.
That pretty much sums up our list of legal tips and tricks for freelancers. Have you been a freelancer long? Do you have any secret legal wisdom to share? Please do so by leaving us a message in the comments section below.