Deadbeat Clients -- err, Client Misunderstandings

I'm in the middle of some difficult negotiations with a client who hasn't paid me yet for work I did, and invoiced, months ago. (Don't worry, guys, I won't name names!) Dealing with clients who won't pay up is one of the hardest things a freelancer must deal with.

The title for today's post is intentionally provocative -- not all clients who don't pay on time are "deadbeats." Sometimes an invoice gets lost between departments. Many times the art director I'm working for will ask me to email or mail the invoice to them, and they'll pass it on to accounting. And that's often where it falls through the cracks. Sometimes the person who needs to cut the checks goes on vacation, or maternity leave, or resigns, and there's another opportunity for an invoice to get lost.

My invoices ask for payment within 30 days. Sometimes the agency has a policy not to pay for 45 days. Some agencies say that I won't get paid until they get paid by their clients. Obviously, I'm not a fan of that mindset. Do these agencies tell the utility companies that they'll pay their bills when they get paid? Can I tell my landlord or mortgage broker that? I was hired by the agency, not their client, and if I can meet the deadline for my work, they should be able to meet the deadline of payment.

But, even though my invoice says that a late fee of 10% per month will be added after 30 days, I never do that. At 30 days I'll send an email asking if the agency in question has the invoice, and where it is and when I can expect to see payment. It's usually not until 60 days, if it goes that far, that I'll start getting a little pushy. I've only issued a second notice invoice with the late fee added once or twice in my career, and even then, if the agency just paid the initial amount I wouldn't press the matter of the late fee.

The problem of the late fee, of course, is enforcing it. I know I have the legal right to impose such a fee, but if my client disputed it, do I want to go to court or through legal proceedings over it? Of course not; I'd rather just get paid.

The other problem with these negotiations is trying to keep relations with the agency on good terms. On one hand, you don't want to burn bridges, and pushing for late fees and bothering people is a good way to do that. On the other hand, if the agency really is bad at paying on time, or at all, and if this isn't the first time you've had this problem with them, do you really care if you work for them ever again?

I've had couple of clients in the past who would never pay on time. Both of them were habitually late -- sometimes a little, sometimes a lot. I did my best to keep talks with them completely civil, to gently but firmly demand my money. And I made it rather obvious to them that I would not be interested in working with them again. Neither of them called again.

The reason you don't want to be rude or disrespectful in these cases -- the reason you should never be rude or disrespectful ever, in any case -- is that, even if you decide you'll never work for such a firm again, those individuals you're talking to may move on to other agencies. You want them to remember you well, even if you have major disagreements, when they start working for a company that does pay on time. They may be as frustrated and angry at their company's inability to pay on time as you are, but if you take it out on them, instead of getting their empathy at your frustration, you'll become the target of their anger. And you'll burn a bridge.

It's never easy working your way through this kind of situation, but if you keep half your attention on the short-term goal -- getting your payment -- and half on the long-term goal -- making sure your reputation for fair, respectful behavior remains unmarred -- you'll find the right balance, and do what's best for your business.

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