Freelancers Now Free To Go Broke — Late Payers Worse Than Ever

The freelance life — no cubicle, no boss, no schedule — can look so alluring. It increasingly means no income, reports The Wall Street Journal:

About 40% of freelancers had trouble getting paid in 2009, according to a survey released in mid-April by the New York-based Freelancers Union, a 135,000-member organization for independent contractors across the country in fields such as media, technology, and advertising. It was the first year the group asked the question on its member survey. And more than three out of four freelancers said they’ve had trouble getting paid over the course of their careers, according to organization.

The problem could become more acute as independent contractors emerge as a more central piece of the work force. The financial crisis and the resulting high unemployment thrust many professionals into the ranks of freelance workers, which may continue to grow despite signs of an economic recovery.

Littler Mendelson, a San Francisco-based employment law firm with 49 offices nationwide, predicts that in 2010 half of previously eliminated positions filled will be filled by contingent workers—such as independent contractors, freelancers, and temp workers—accounting for as much as 25% of the work force nationwide— based on client interviews and a survey conducted by a staffing analysis firm.

Since independent contractors aren’t covered by most federal employment laws, they don’t enjoy the same legal protections on wages as permanent employees, says a spokesman for the Department of Labor. If a permanent employee doesn’t get paid, federal or state labor departments can fine companies and even prosecute company executives. But independent contractors often have to turn to the court system, in most cases small claims, if they go unpaid.

I wrote about this trend for The New York Times last year — after two publications did their level best to screw me out of almost $7,000 I’d earned. One owed me $5,600 and sent me emails telling me of their financial troubles. Like I care. If I can run my business efficiently, so can you. I found a contingency lawyer, sued and won half (the lawyer, sad to say, took a third of that.) I hired another lawyer — a softball buddy who helped out for two bottles of Stoli — whose letter to the other deadbeat produced payment within two days of his letter, after months of nyah-nyahing and stonewalling.

These losers always manage to pay for everything else — their office space, heat, light and gas for their vehicles.

Freelancers? Feh, they can wait.

No we can’t — not with credit lines restricted and credit card APRs now shooting through the roof. My bank is charging me $10 every time I use my overdraft protection (line of credit) — this in addition to the usurious interest rate they charge on the balance and cutting my line of credit from $20,000 to $15,000 — because…they can.

If someone isn’t paying you, sue their ass. Don’t “be nice.” You don’t want to burn every  bridge, but some look much better in flames. If a client is screwing you and smiling, why would you want them anyway?

14 thoughts on “Freelancers Now Free To Go Broke — Late Payers Worse Than Ever

  1. citifieddoug

    Freelancing is a courageous life. During my two years as an independent contractor I was so disorganized when it came to invoicing that my late payments were always my own fault. I never realized that was a blessing.

  2. Caitlin Kelly

    Not sure if it’s meant to be courageous — many of us are people who gave up looking for a “real” staff job because there weren’t any. I think it does require a tremendous amount of self-discipline, whether keeping very careful track of your budget (not overspending, saving for retirement) or tracking every single invoice. I keep a document in my computer telling me what day I invoiced so I know when a payment is late.

    Many freelancers are too scared to piss off clients by being (overly) aggressive with collections. My bills are always due at the same time each month, so I have zero patience with this BS.

  3. citifieddoug

    I don’t think it has to be voluntary to be courageous and I wish I had that kind of discipline. During my self-employment days there were times when I’d have five figures in receivables while my girlfriend and I searched the couch for coins to take to the grocery store.

  4. Caitlin Kelly

    That’s interesting. Why were you (so) reluctant to chase down your pay? Or were your clients being deadbeats?

    One of the crucial elements, for me, of working freelance is networking like mad with others to sniff out these losers before even committing a minute of my time/labor (same thing) to them. Many publishers are known for their nasty behavior and all you have to so is join a few writers’ groups (or whatever industry you’re in) to make sure you don’t do anything for them. Forewarned is forearmed.

    The deadbeats who stiffed me $5600 also shut off $20,000 worth of assignments as they went belly-up. I wasn’t quickly able to gin up that much replacement work mid-recession so it hurt me twice.

  5. citifieddoug

    I actually think it’s another symptom of the underlying disease that also causes male refrigerator blindness. If I sit down and scratch out an invoice, I will be whole and well in 30 days but right now (right now being ’97 or so) I have a pretty but hungry and kind of angry woman hoping for supper sooner.

    Funny, years later when I was safely back on salary and the same girlfriend was salaried too, we were showing her Canadian cousins around California when the cousin started ripping her free-lance consultant husband a new one for the precise same bad habit. I offered roughly the paragraph above in his defense. The argument went silent for several minutes and then my girlfriend said “that makes a surprising amount of sense, but you’re still an idiot,” and her cousin added to her husband. “Yeah. Idiot.”

  6. Caitlin Kelly

    This is so not working for me as an excuse! Luckily my partner has a salary so we know exactly what income we can count on each month. I have a basic “nut” I have to meet, and am always trying, of course, to make a lot more than that.

    I am also now much more cautious about which new clients I take on and now also ask for raises whenever possible. I may raise my hourly editing rate again. No one will give anything to you freelance without you asking for it — often repeatedly.

    All you have (in addition to your skills) freelance is time/money and so every minute I have to waste chasing a deadbeat is time and energy that could and should more profitably be spent seeking and nurturing relationships with those who are *not* PITAs.

    I recently met a new-to-me online editor and asked how much work she can assign each month; i.e. a quick calculation of whether it was financially workable for me. I also found out someone I know who works for her so can, and will, also investigate the PITA factor and how quickly they do pay.

  7. john

    Freelancers union is something that might be of interest. It’s basically a site dedicated to freelancers and issues like this one. Their point is that 30% of the workforce consists of freelancers and they advocate for them through campaigns and such. Their site is suffering some formatting issues at the moment, but this is a prime issue.

  8. Caitlin Kelly

    John, the dirty secret of the Freelancers’ Union is, for all their very good work, many of us simply don’t qualify! It’s nuts. Someone with all my credentials and experience, because I don’t have some permatemp thing *proving* I am freelance, means too bad for me and others like me.

    jcalton, my profession is filled with many wonderful things and I love it. I loathe chasing payment *for* it.

    This issue affects everyone (as I said my NYB story), from interior designers and graphic artists to contractors. Even the guy who made our bathroom vanity for us last January (2009) told me was then owed something like $30,000 from late payers, and had a big staff and rent to pay.

    1. It’s great that you’re spreading the story about deadbeat clients! I was happy to catch this post from you, and your own groan-worthy story perfectly illustrates the problem. In response to you and John, we’re actually running a campaign in NY right now to pass legislation that’ll protect freelancers the same way employees are currently protected. (

      Thought I should also mention, though, that it’s free to join our organization as a member, and there are no requirements. There are eligibility rules for the health insurance, though it’s not apparent to me why you wouldn’t qualify. Apologies if you’ve already been through the process, but if you haven’t before, why not give our Member Services a call (800.856.9981) to discuss it?

      We’ve got tens of thousands of members who aren’t insurance subscribers, and they’re the ones who help us win victories like killing the UBT . . . and hopefully, putting an end to unpaid wages!

  9. Caitlin Kelly

    Indira, thanks for visiting and commenting. I’m covered for now, luckily, through my partner’s health plan at work. But anyone fighting hard for freelancers — as I do as a board member of the ASJA — gets my vote.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s