If you are in a position where a client won’t pay, here are some simple steps to follow to ensure that you get what you are owed, and to avoid having to chase payments in the future.
Being a freelancer can be wonderful. You (ideally) get to work on projects you’re passionate about — or at least have some interest in — and you can see the results of your work in a diverse cross-section of places.
Occasionally, however, people do try and take advantage of freelancers, with one of the worst situations being when a client won’t pay.
Did you know 41% of clients hiring freelancers consistently pay late and 55% of UK freelancers have done work they have not been paid for, but only a third have stopped working for a client who consistently pays late
However, you do have rights and several steps which you can follow to make sure you are paid what you are owed.
I’ve been recently communicating with a non-paying client myself and — as it’s such a frustrating experience that, unfortunately, most freelancers will have to deal with at one point or other — I thought I would channel some of that energy into writing the steps to follow if, and when, you find yourself in the situation where a client won’t pay.
If you feel overwhelmed when it comes to fighting for your right to get paid, you’re not alone:
53% of freelancers say they are not aware of their rights when clients don’t pay, with 34% saying they don’t understand how late payment charges work, or know what to charge.
So lets go through some things to be aware of and what you can do.
There are a few different examples of non-paying clients that you may come across:
- There could be issues with banking. This likely means that a payment has allegedly been sent from their end with nothing arriving at your end. This can be very frustrating but remember: there will always be paperwork which proves that, on your end, you haven’t been paid and, on their end, that they have sent it.
Make sure to request and show this paperwork. It’s their responsibility to make sure that you are paid and, until the money arrives, the simple fact is that you simply haven’t been paid.
- If a client won’t pay because they have decided not to use your copy. This means you should be entitled to a ‘kill fee’ for your time. Make sure you always have this stated in your contract and make sure you discuss this with new clients. If there has been no mention of a kill fee anywhere, you should absolutely still request that they pay you one.
- A client may suddenly ghost you. It happens more than you might think. They take your work and you never hear from them again. This is difficult to deal with and very frustrating. Follow the steps below to the email address and phone number you do have and, if you can, contact other members of their department or company.
- They may say they are waiting for a payment on their end in order to then pay you. This really isn’t an option and, if it’s not something they have discussed with you beforehand, it’s most likely an excuse and I would follow the steps below. You could be flexible and suggest a payment plan at your own discretion.
- They may suggest that they haven’t received your invoice or it is incorrectly formatted without ever alerting you to this fact. This is often a delaying tactic. You can make it a policy on your part that you check if an invoice has been received by making sure you always get a reply.
Being in this situation is never pleasant and no freelancer should have to deal with it but here we are. As a rule, try and keep aside at least a month’s worth of your monthly budget in emergency savings so that other people’s incompetence doesn’t put you in a bad financial situation. Here is our guide to budgeting and saving as a freelancer for some handy tips.
Whatever the reason you aren’t being paid, here are the standard steps to follow to make your way towards a resolution.
Smart Freelancer Steps to Take if a Client Won’t Pay
Email several times (and make sure you keep all of the emails in case you need evidence later) and explain politely and simply what is owed and when you expect the payment by.
You don’t have to give a lot of detail about your situation or beg them to pay you, it’s their responsibility to pay for the service you provided. For your second and third emails, explain what non-payments could lead to, for example, negative reviews, late fees, and legal action.
Check the law with regards to what you’re owed in terms of late fees.
Fees: £40 for invoices up to £1000, £70 up to £10,000, and £100 above £10,000.
Make sure to have this stated in your contract but keep in mind that you are entitled to this regardless of whether it is in your contract or not.
“If time is money and you wasted my time, then give me back my money!”
― Ljupka Cvetanova, The New Land
For those in the US, you can find a lot of information on charging late fees on the Freelancer Union website. They also offer a UK site and can help you set up freelance insurance that can help you chase payments and cover you for your business equipment.
This is where you’ll probably start receiving excuses. You can use your own judgement here but, frankly, you deserve to be paid for your work within 30 – 60 days so it’s up to you to whether you accept their terms or move on to the next steps. If you’re being ghosted by this point then move on to the next step.
Put in a final invoice stating the amount you are now owed plus any late fees and charges with the advice you will be taking legal action. If you do already have a solicitor involved, cc them to this email.
You can also consider a spot of social media shaming. Sometimes a brand’s image matters a lot more to them than making sure their freelancers are paid on time.
It’s also a fair warning to anyone else thinking of working with this client in the future. This is totally up to you and if you do try this I’d wait until you’ve sent them a few step-one emails to give them a chance first.
Start collection proceedings (depending on the rules of your country). I’m most familiar with the laws in the UK so I’m going to expand on those below but the steps are generally similar across most countries.
However, whatever country you are in, you are always free to find a reputable solicitor who specialises in this area. They can send a letter to the client and this may be enough to scare a non-payer into paying up. A quick google search should bring up someone local who can help you.
After that, it’s up to you whether carrying on with the solicitor fees is worth it depending on the amount you’re claiming. If it isn’t then proceedings like that small claims court below may be the next best course of action.
How to start legal money claim proceedings in the UK
- In the UK, if the amount is under £10,000, you can take it to the small claims court for £25. This is meant to be a quicker and more streamlined way of dealing with lower value claims.
This will typically be organised through a series of letters which will request evidence and responses, depending on how the non-paying client responds. You may also have to attend a hearing. This is usually a very successful way of getting any money you’re owed.
- For fees up to £100,000, you can use the internet-based service Money Claim Online and they will act as the middle-man between you and the client. It operates similarly to the small claims court. These are both low-cost ways to help you collect the money you are owed. Typically between £10 – £30.
- You can also use a debt collection agency to help recover the amount you are are owed. Make sure they are part of the Credit Services Association to ensure they are reputable and follow certain standards of practice.
Freelancer Contract Tips for the Future
One of the most helpful ways to make sure you are ready for any disputes is to make sure you have a freelancer contract and ask any new clients to sign before working with you.
Here are some ready-made freelance contract templates which cover your back from all bases that have been tested in the real world and written with the support of lawyers.
Some tips for what you should include in your freelancer contract in the future can be found below:
- Make sure you have a clause in your freelance contract which states you will add interest for late payments. Your time spent chasing payments should be compensated.
- Add details about a kill fee in your freelancer contract and enquire about the kill fee policy when working with a new client. Your time working should not be wasted whatever the company then decided to do with the end product.
- Always look out for a receipt of invoice email. If they haven’t said they’ve received your invoice, just send a quick email asking if they received your invoice. This can save a lot of time down the line.
- Stay on top of your invoicing and owed payments to make sure you aren’t missing any payments making it more difficult to chase up later. You can do this by adding notes to your calendar (physical or digital), by keeping a diary, or by having a folder full of receipts and screenshots. There are also software options available who prefer things done electronically.
I hope this guide helps you with a difficult situation that freelancers shouldn’t have to deal with but often do. Here are some other must-know freelancer tips to help and support.