Become a Digital Mercenary Part 4 - Securing Contracts with Special Guest Ben

# Navigating Freelancing Challenges: A Comprehensive Guide

## Introduction to the Challenges of Freelancing

Freelancing offers a unique opportunity to work on diverse projects, but it also presents several challenges, particularly when it comes to managing client relationships and ensuring timely payment. In this video, Wendell and his friend Ben, a lawyer, discuss the trials they've faced while freelancing and offer practical advice based on their experiences.

## Importance of Having a Contract

One of the most critical aspects of freelancing is having a clear contract in place from the beginning. Contracts can be formed through written agreements or documented email correspondence. While it's preferable to have a formal written contract signed by both parties, even a series of well-documented emails can serve as a legal basis for your work.

## Structuring Payments and Billing Practices

Efficient payment management is essential for maintaining cash flow. Instead of waiting until the project concludes to send a large bill, consider breaking payments into smaller increments. Early and frequent billing not only ensures steady income but also helps in managing client expectations.

## Handling Meetings and Client Communication

Meetings are an inevitable part of freelancing and should be treated as billable hours. It's crucial to communicate your charges upfront to avoid misunderstandings. If a client hesitates, consider including meeting costs in your project proposal to make it clear from the outset.

## Defining Scope and Goals in Contracts

Clearly defining the scope of work in contracts helps prevent scope creep. Whether through a detailed written contract or periodic updates, ensure both you and your client are aligned on deliverables and timelines.

## Protecting Intellectual Property (IP)

Protecting your intellectual property is vital, especially in fields like software development. Consider retaining ownership rights and granting clients licenses instead of transferring ownership outright. Consulting with a patent attorney can provide additional legal safeguards.

## Dealing with Non-Paying Clients

The fear of non-payment is prevalent among freelancers. Implement measures such as requiring retainers or using platforms that hold payments in escrow until the project is complete. If your work involves digital assets, consider not releasing final deliverables until payment is received.

## Legal Considerations and Protective Measures

Limiting liability by capping damages to the contract value can protect you from excessive claims. Including a kill fee in contracts allows both parties to exit without legal disputes if circumstances change, offering flexibility while maintaining fairness.

## Mediation, Arbitration, and Small Claims Court

Resolving disputes through mediation or arbitration is often more efficient than court proceedings. Platforms like Upwork offer dispute resolution services, which can be beneficial for smaller projects. If all else fails, small claims courts remain an option for recovering payments.

## Networking and Building Relationships

Building a network is essential for securing freelance opportunities. While platforms like Fiverr are useful, personal referrals and associations often lead to more reliable clients. Consistent attendance at relevant events and gatherings can significantly enhance your visibility and credibility.

## Seeking Legal Help as a Freelancer

Legal issues can be complex, so seeking professional advice is crucial. Many lawyers offer free consultations and may reduce fees if you provide services in exchange. Additionally, books like Sarah Horowitz's *The Freelancer’s Bible* can offer valuable insights and strategies for navigating freelance challenges.

## Conclusion: Final Tips and Encouragement

Freelancing is a rewarding yet demanding career path. By learning from others' experiences and preparing adequately, you can mitigate risks and build a successful freelancing business. Remember, protecting your interests legally and maintaining clear communication with clients are key to long-term success in this field.

"WEBVTTKind: captionsLanguage: enso Wendell has this friend of his coming today he's a lawyer yeah when we looked at this list of questions and realistically we can't answer them without a lawyer but I don't really want to be even in the same room with it I've heard that they're like bloodsuckers like will he charge us for the literal literal consuming like in that blood to survive he's gonna charge us for this isn't he Louisville one can't afford that I don't know if we should even do this so you've been through the entire series of the joy of computing although I guess we're not really common on following digital and you're ready to work so you've made it through the introduction and you set up your workspace and you've got the zen-like understanding of yourself and you're ready to actually do work and actually get paid for your work but it's not really that simple yeah if you might think if you watch all the other videos and you follow those tips or you did your own version of it you're thinking man the hard part's behind me but we've learned from experience doing the work and you're just waiting to get paid sometimes that can be the hardest part and definitely the most frustrating part sometimes people don't want to pay you so then you need to figure out a contract and to help us with that today we have our friend Ben who's a lawyer and can help us go over what to do to get yourself paid help us answer questions now should go without saying that you know disclaimer not really we're just sharing some life experiences here's what it is we have gone through this ourselves so we know that his advice is sound and easy advice of advice before and actual problems so we're not at all worried about actually giving you this advice to follow so yeah well thanks for having us I mean sure thanks for joining joining us my pleasure all right so I guess I'll go first we have gotten together nine questions and we think these in our experiences these questions sort of encompass how to deal with the worst parts of trying to get paid and trying to set up your relationship with your clients because some of them won't be contentious but you have to protect yourself without offending them and roaning getting the job so probably the the overall question when do I have to have a contract well you have a contract from the beginning of your correspondence with the client contracts are dynamic processes and they are formed by the relationships between the parties now you can have a written contract where you reduce it all to writing or you can just document the communication between you and the client to the extent that you summarize what the client is asking you to do that you ask the client for a response but of course it's preferred if you reduce it to writing and call it a contract and ask the client to sign it so let's say I'm an email correspondence somebody says hey I want you to do this and I'm looking to pay you this how much protections that give me just having the record of those emails I think it gives you a lot of protection it's not foolproof but you'll find as you do freelancing work that there are going to be quiet and people that have unreasonable expectations and those people are going to be reached redrawing the contract every day so would you say that the one of the important things of a contract or a bunch of emails that might be assembled to form the contract is disambiguation so that it's clear to a third party like if the third party is reading your email and your clients email is it clear to the third party what needs to happen I think you need to to pitch your documentation to that third party you always need to keep in mind that someone may end up looking at the correspondence between the two of you and making a judgement who should be paid and that someone is a judge in some instances but in the case of small contracts with between freelancer and client and there are less than $5,000 typically that's not going to be a case that reaches court it may reach some sort of mediator so you need to be clear in your language and restate what the client has told you and hopefully get some response from the client either clarifying your email or saying that's correct so in terms of getting paid how should you structure your payments how soon should you get paid should you do it in just smaller increments or what do you recommend well I think the small increments is a is a good starting place to talk about this the client generally has to answer to someone to get a big bill paid when you send a bill after three months $30,000 then you're gonna get the whining of the boss coming out and everybody's going to say well the freelancer is making more money than we are on this project and so you need to send small bills and start early and often that of course the first thing I would want if I was a freelancer is a retainer a non-refundable retainer and what we can talk about that later so would you say that like figuring out a retainer and maybe making an estimate for the work that sometimes those things go hand in hand is sort of setting up the structure of how you're going to interact with the client do you have any tips or pointers for setting up a fair estimate or like how to structure that well and and that's the temperament of the client is something you have to read of what tolerance they have to pay in advance but the ideal client is one that you you get paid for what you're working on and you don't ever have too much held back so that if you can get I guess what I'm looking at is I want my client to get twenty five hundred dollars which is easy to approve from the client as soon as possible as soon as you do two units of work let's say you're doing two book reviews you want once you get two book reviews done you want payment for those two book reviews if you're gonna have 30 and all you break it up into 15 payments rather than just send them the bill at the end of the at the end of the work period yeah I definitely can say that billing early and billing often definitely serves you well and even billing before final delivery like you might save ten or fifteen or twenty five percent for the end of the project but you actually don't deliver everything until that last ten or twenty five percent or whatever is paid that's the key the last payment is hard to get the retainage often is not collected and there has to be some way that the freelancer can assure be assure that they're gonna get that final payment before they release the full project now this is a problem that freelancers have been facing for a long time because the pattern seems to be that a lot of a lot of business owners maybe will invent reasons not to pay the last payment whether it's the last 10% or the last $5,000 with West yeah last five dollars whatever it happens to be but you were telling me that there was recent law changes in New York State and and if I remember correctly you were saying it reminded you of the Uniform Code for landlords and tenants which is now pretty much universal sure like tats anyone that's dispossessed or in an inferior position to the muddied interest is going to be overreach meaning that you know you're the freelancer and the company that's paying you can basically do whatever you want kind of like how landlords used to be able to do whatever they want over their tenants that's right so what what the New York City Council did about three four years ago is they passed some enabling legislation which allows a regulatory body in New York to set standards for freelancing and I think the idea of it is to identify clients who typically run over tenants or freelancers run over in this case run over freelancers so once you can identify the the problem the deadbeats then you can cause it is helpful yeah so and it may be not so long before we start seeing laws like that everywhere which would be good for freelancers probably if we're gonna move into a freelance economy I would hope so there there is a woman that I want to bring up at some point who is a labor lawyer and in 1995 she'd graduated from law school and she went to work for a law firm and she thought she was going as an employee but she turned out to be an independent contractor which had implications tax implications health benefits implications and so from that experience of being an independent contractor as an employer she began to organize independent contractors and then later freelancers she formed what's known now is the freelancers Union and they are based in New York in Brooklyn and they have a website Twitter accounts Facebook accounts and they're very active in consumer or freelancer protection though your audience might take a look at her in her websites but also her book she has a seminal book written in 2012 it's called the freelancers Bible and it's a excellent compendium of everything you need to know about freelancing had it from how to form the contracts to how to manage your office and I read it and it was very helpful and it will advance someone without any experience five years I think what was her name again her name is Sarah Horowitz hor OWI TZ and we've added a link in the description below good now we talked about the the emails and how you want to be very specific about what the job is and you're probably gonna be meeting with these people a lot and hammering out like I'm gonna bill you this for this and a lot of people are gonna underestimate how much of an investment that is like you're gonna spend so much time before you even start working so what would you say should you bill for that kind of work for the meetings for stuff like that how do you think is a good way for freelance for handle a can I think well you definitely have to be aware as a freelancer that meetings are gonna be necessary that's frequent and if you if my thinking is that if you build for that some people will avoid having a meeting because they don't want to they don't want to pay the $100 it's going to cost for the meeting and so they find other ways to to talk with you or just conceal their need for a clarification so you need to build it into your pricing but I don't know that you specify that that you were just charged $100 for me it's uh it turns out that you know that's something that I definitely think I still struggle with because what seems to work pretty well is in the project to be like okay this is going to be a two-week project and it's going to take this this and this we'll just go ahead and pre-scheduled this number of meetings and just build it into the car that way but then if there's excessive meetings then bill for that because you're kind of damned if you do and damned if you don't in terms of billing and meetings and things like that because you will have the people to try to retreat into not communicating which puts you in a worse spot but you still need to take that brain time to figure it out because as much as you spend your time doing work you also spend a lot of time figuring out the problem and solving the problem and helping the client to find the problem and I definitely see that as billable yes and I think you're a very good one to let going the extra mile for a client and then at some point you have to say to them yeah I went ahead and did this meeting for us or I did this extra work but if I'm that long yeah this is going to be a an added cost and you express it in some unit that they can understand for our next question how would you how should I define my scope and my goals in the contract is there like any sort of way should I to my zit or should I just put all in paragraph format or like what is the best way to approach that you think well I think that in the normal contract I think a written contract do you have a statement of work is that your experience and and in that you provide some context for the job you know I'm going to edit your book gone with the wind and then you proceed to to state or outline what editing includes so you have to define what you're going to do and it's helpful if you also had some where what you're not going to do this does not include and this could be in emails but preferably it would be you know in a contract well for large and complicated things it can be a it can be a huge paper trail to keep track of all the different emails and you know depending on one person's interpretation so it's it is periodically helpful I think to just you know we clear monthly send a thing that's like this is where we are this is the status this is everything it's done this is everything that we're not going to address this is everything that we're going to do sometimes the client will introduce new work and then you have to say okay that's new work that's gonna be a separate billable item but it can get messy fast right so is it is it is it worth the effort to stay on top of all that just to avoid confusion later well it's crucial or you're not gonna be paid with what you're owed because everyone wants you to not only write their book but design the cover and you know distribute it and they'll even ask you to come over and take the boxes to the race like line yeah well I have been on the receiving end it's like well you know if that thing was out of scope why did you do this other thing well I just did that other thing because I'm nice but now that is perhaps it remind me to never be nice again I get that a lot as a designer where someone will send me something and then they send me the copy and I never touch copy because I'm not an editor that's not for me to touch and they're like well they're a bunch of misspellings in there so I'm like well I'm not your editor I'm gonna designer you need to send that to someone else that's not my job but it's not in our scope and if you'll refer to the engagement letter it says we don't do editing so well one way to solve some of those problems is to say this is the entire grant between the parties the last part of your contract usually says this and nothing outside of this contract it forms the nothing outside this document forms a new contract unless it's signed by both parties in writing so so the idea would be to the first document incorporates all the agreements all the emails everything and that nothing nothing else is involved in the agreement or in the contract but then as you need to change it you just say this is a new contract where this is an addendum to contract of February 10th 19 2018 and the new agreement is as follows and then you just list what you've agreed to do for its in terms of scope of work now something interesting that's coming out of our conversation is that a lot of would-be freelancers may assume that these contracts require a lot of legalese but it sounds like just a plain you know one or two page letter that's like this is what I'm gonna do here it is that that would suffice for a contract that in a lot of cases you really don't need a lot of impenetrable legalese I think that's right depending on the the amount of the contract and depending on your view of the of the client I mean some clients are gonna present badly and you may have to protect yourself they're gonna ask for the moon yeah yeah so it sounds like for the scope creep end of it that handling that just through revising the contract and you know sending the updated things like that we all agree that this is gonna be the additional work that we're gonna do and this is gonna be the additional costs just having even an informal email like that if it doesn't rise to the level of something else that that would be sufficient as the scope of the project changes I think that that's well said once it's outside the scope of the work there's you view it you need to send them something saying this is outside the scope of the work I did this but we're not gonna be doing that next week we're gonna have to do this next week where I have to charge you more so one of the big things with software that probably doesn't affect a lot of other kinds of contracts is who owns it if I build it for somebody else is that there is is it mine and if they try to make it theirs and they have the code is there anything I can do about it what would you suggest for sort of protecting yourself there and making it clear well sometimes these are big decisions because it can let's say you have a copyright on a book and somebody wants to use this book in their business and sell 2,000 copies of it or something they somehow incorporate it into their advertising we you don't want to give them the copyright to the book you want to give them rights to publish it but you may want to use this book or the content that you've been working on for two or three years you may want to use it in a dozen papers that you write later you may want to incorporate it and fold it over into a whole new book and for sure with a software you don't want to give away your software you want to license it and keep the copyright keep the rights to it so do you have any suggestions about its language to include just put that in writing are you saying well sometimes as one de Mo's these these are these are big issues and some large large deals and so you you definitely have to get a patent lawyer and consult with them they're really good at drawing up contracts I struggled in early days not knowing what what the language was copyright is a special special area of law that general practitioners don't know anything about and so getting a patent attorney is very important to protect your eyes but generally if you're gonna be a do-it-yourselfer just he just one which we all do we just want to give them a license and we want to keep ownership of that software so you can use it on other things yeah it would be like asking a carpenter or a drywall or to give up their tools is how you can explain it to your clients or your website would be Claudius that's a good example so usually just in those simple friendly one-page emails I think you know in the in the early days just the one lines like you have a worldwide perpetual non revocable license to do with this code as you please but you know we we retain the ownership or I retain the ownership or whatever and that generally works pretty well for the open source licenses like the GPL version two you know just a statement that any work done will be licensed under the GPL version two because this work is based on other work that's already licensed GPL version two or three-year MIT license or whatever and so usually the conversation with the clients not too hard because it's like well I'm doing work for you you don't own the code we're just continuing to license the code the same way that you know whatever is based on is licensed as usually that's sufficient that's not really like if you were doing something really expensive definitely see patent attorney and help them get it sorted out but for pedestrian stuff it's fine what do you do this is the question everyone has been fast forwarding through the video to find is what do I do if the client doesn't pay me panic that's usually what I do only see a post on reddit every other Bank where like somebody has said a client's website on fire and there's just like animated gifs in the background and it's like oh you didn't pay me after I've just oh that's not okay yeah you need to prepare for for that event from the beginning of the contract I think and I'm sure there are ways that you have four websites that you can not you can have the website as demonstration only but it doesn't go live until you're paid and I don't know I'm sure most people technical knowledge know how to do this it's the easiest way to do that nothing motivates payment faster than we need this to do whatever is like great send me Jay yeah we'll play my credit card because you know even freelancers can take credit cards now and that makes life a lot easier in some ways actually so yeah it's definitely so it's it's it's what you say that it's if it's not okay to really do anything with it if it's already on servers or whatever owned by the client that what that worries me as you know I think once what's the once the horses escape yeah what what's the websites up and going and you come along that a month later and you haven't been paid in the 30-day time period and you start turning off somebody's website your lawyer better be up overnight or preparing a motion for declaratory judgment or something and filing at the courthouse the next morning because the the clients going to be upset that their websites turned off so that's a risky so what would you do yeah can you do that I seem you probably you shouldn't I don't think I think that the damages are too great really to turn someone's website off once it's up and going a judge would frown on that too I think it's just just the akley between the parties would say well this is reducible to well the client is going to claim loss of income and that's another thing in your contracts we need to talk about at some point ISM is talking about what happens if the contract is terminated and/or that someone's in default or the damages and the freelancer doesn't want to have damages outside the scope of the contract you want to try to limit it to the amount of the contract if you can yeah so what what you mean I think is just having another just a one-line statement you know in plain English that is you know I'm not responsible for anything beyond the fee collected from the client so if you do a $5,000 project and the client pays you $5,000 and then something crazy happens later and the client wants a refund they can't demand ten or fifteen or or twenty thousand dollars for having to redo whatever you did and you know asking for damages from having to find somebody else to do it in whatever right we call that a liquidated damages and you put that in the in the contract if there's a default what are the damages gonna be and then you can just spell out what they can be they won't exceed that value of the contract the worst case scenario you only have to give the client a full refund and not more than that because that would be bad for business if you have that in writing his liquidated damages you can do that and then there are two other variables the to kill fee which enables anyone to get out of the contract for a price and it would be nice if the freelancer has a death in the family that they could and just can't work on the project anymore that they could get out of their contract you can write that in that in the event of default of either party the amount to be paid to the other is a thousand dollars or ten thousand dollars or whatever now there are also some freelance services like up desk and I don't know I can't think of any other ones there are websites that will hold that money in escrow for those types of arrangements but right those are typically for you know jobs and scope of like five thousand dollars or less I would say so pretty pretty protest Rhian those platforms are nice and I'm amazed at the uber platform and the Airbnb I mean those work really well for people for for both sides it seems like some freelancers have found those platforms useful in situations where it is difficult to get paid because you can lean on the platform to either ding the clients rating or do give the clients some other incentive outside the contract to pay but assuming that that fails or the contract fails and the client is just gone completely unresponsive I think you mentioned that it usually doesn't come to a court case usually it would be something like arbitration first and then maybe a court case maybe small claims as an option what are you doing those scenarios well mediation is a it's a nice way to resolve disputes where mediator provided by the platform or you can work with the mediator as a both the client and the freelancer can work with a mediator and just present the case to him let him make some suggestions like he mediate a dispute between husband and wife and the mediator middle-schoolers and the mediator then makes a suggestion and hopefully that would would resolve it and usually it does it is interesting that freelancers Union has did a survey of their members 44% of their members had difficulty collecting accounts over the course of 2010 so it's a real problem and how to get paid is an art there's definitely a few times where you know I was having trouble with collecting payment and just sending the emails like hey I believe that I've satisfied everything here I haven't heard from you I would like to open up arbitration or you know have this arbitrated here some people in the area that can help us arbitrate this dispute please respond with sufficient to actually get final payment just because they were like I don't really want to fool with this right visit oh if it does eventually you know if you wanted to go to small claims court or something like that does it look good if you have the documentation to say well I'll try to do arbitration to resolve our dispute but they didn't really want to do that so here we are sure I think that it helps a lot in small claims court the limitations of small claims court generally are that you're contracting outside the state so it's hard to collect in a small claims court in your state when you're suing someone in a different country or would you have any other advice for would-be freelancers or anybody new to the freelancing world that hasn't gotten there hasn't taken their lumps yet well I think you have to get your feet wet without some experience it's hard to read and understand what these books are talking about but now there's a lot of information on the internet under freelancer most of it's terrible probably so but reading a book like the freelancers Bible that will advance you in a number of years and your experience level just by reading these cases but the important thing is to network and to because you don't want to get on Fiverr you don't want to get up watch if you can have clients for your networking your associations with other people that you went to school with that that you know in business you keep showing up showing up is so important in death that's gonna be the hardest thing in this video it's like our audience is so antisocial and I have a sign I like that too he's an IT well let's say one final question let's say that you're finally getting the projects that are big enough or you're simply so overwhelmed by this that you need to go for legal help what can they expect to pay what kind of ballpark are they looking for for basic services to take care of these kinds of things one's gonna need a retainer well it depends on the lawyer you go to obviously it if you go to a boutique that's one or two people and you're your town you're probably going to get a free consultation and you're gonna get a yes or no whether they know much about freelancing law and whether they're willing to write letters for you and sometimes relationships can develop where you take care of the computers of the lawyer for the first month and then he writes a few letters for you and then he realizes he can't live without you and then Windell owns all the lawyers yeah because he just you know once you taste Wendell's magic potion you know gonna drink anywhere else so basically you're saying barter maybe as a way to get services barter is not ideal but certainly just doing somebody a favor can come back to enfold so don't hesitate to help your clients if you're a freelancer going that extra mile doing extra work when you're young knowing that you're learning how to do it yourself and you don't want to have the client completely pay for your education you know you you want to have some bag of tools before you start working and offering your expertise so so do that giveaway free giveaway work and and help charitable organizations and nonprofits give away working the right people well now one don't will I mean I've seen him give a whole computer lab to a school in Eastern Kentucky you know just I mean there's you know pretty bad well of course you're always gonna get burned by a well-meaning clients you know they don't they don't understand oftentimes your business so you have to educate them let them know that you can't be doing this free work all time all the time there's so much to living other than just technology it's crazy you know well thanks for coming on it's really interesting maybe it's for you guys have any other questions might be there we can do another follow-up video sometime in the future so let us knowso Wendell has this friend of his coming today he's a lawyer yeah when we looked at this list of questions and realistically we can't answer them without a lawyer but I don't really want to be even in the same room with it I've heard that they're like bloodsuckers like will he charge us for the literal literal consuming like in that blood to survive he's gonna charge us for this isn't he Louisville one can't afford that I don't know if we should even do this so you've been through the entire series of the joy of computing although I guess we're not really common on following digital and you're ready to work so you've made it through the introduction and you set up your workspace and you've got the zen-like understanding of yourself and you're ready to actually do work and actually get paid for your work but it's not really that simple yeah if you might think if you watch all the other videos and you follow those tips or you did your own version of it you're thinking man the hard part's behind me but we've learned from experience doing the work and you're just waiting to get paid sometimes that can be the hardest part and definitely the most frustrating part sometimes people don't want to pay you so then you need to figure out a contract and to help us with that today we have our friend Ben who's a lawyer and can help us go over what to do to get yourself paid help us answer questions now should go without saying that you know disclaimer not really we're just sharing some life experiences here's what it is we have gone through this ourselves so we know that his advice is sound and easy advice of advice before and actual problems so we're not at all worried about actually giving you this advice to follow so yeah well thanks for having us I mean sure thanks for joining joining us my pleasure all right so I guess I'll go first we have gotten together nine questions and we think these in our experiences these questions sort of encompass how to deal with the worst parts of trying to get paid and trying to set up your relationship with your clients because some of them won't be contentious but you have to protect yourself without offending them and roaning getting the job so probably the the overall question when do I have to have a contract well you have a contract from the beginning of your correspondence with the client contracts are dynamic processes and they are formed by the relationships between the parties now you can have a written contract where you reduce it all to writing or you can just document the communication between you and the client to the extent that you summarize what the client is asking you to do that you ask the client for a response but of course it's preferred if you reduce it to writing and call it a contract and ask the client to sign it so let's say I'm an email correspondence somebody says hey I want you to do this and I'm looking to pay you this how much protections that give me just having the record of those emails I think it gives you a lot of protection it's not foolproof but you'll find as you do freelancing work that there are going to be quiet and people that have unreasonable expectations and those people are going to be reached redrawing the contract every day so would you say that the one of the important things of a contract or a bunch of emails that might be assembled to form the contract is disambiguation so that it's clear to a third party like if the third party is reading your email and your clients email is it clear to the third party what needs to happen I think you need to to pitch your documentation to that third party you always need to keep in mind that someone may end up looking at the correspondence between the two of you and making a judgement who should be paid and that someone is a judge in some instances but in the case of small contracts with between freelancer and client and there are less than $5,000 typically that's not going to be a case that reaches court it may reach some sort of mediator so you need to be clear in your language and restate what the client has told you and hopefully get some response from the client either clarifying your email or saying that's correct so in terms of getting paid how should you structure your payments how soon should you get paid should you do it in just smaller increments or what do you recommend well I think the small increments is a is a good starting place to talk about this the client generally has to answer to someone to get a big bill paid when you send a bill after three months $30,000 then you're gonna get the whining of the boss coming out and everybody's going to say well the freelancer is making more money than we are on this project and so you need to send small bills and start early and often that of course the first thing I would want if I was a freelancer is a retainer a non-refundable retainer and what we can talk about that later so would you say that like figuring out a retainer and maybe making an estimate for the work that sometimes those things go hand in hand is sort of setting up the structure of how you're going to interact with the client do you have any tips or pointers for setting up a fair estimate or like how to structure that well and and that's the temperament of the client is something you have to read of what tolerance they have to pay in advance but the ideal client is one that you you get paid for what you're working on and you don't ever have too much held back so that if you can get I guess what I'm looking at is I want my client to get twenty five hundred dollars which is easy to approve from the client as soon as possible as soon as you do two units of work let's say you're doing two book reviews you want once you get two book reviews done you want payment for those two book reviews if you're gonna have 30 and all you break it up into 15 payments rather than just send them the bill at the end of the at the end of the work period yeah I definitely can say that billing early and billing often definitely serves you well and even billing before final delivery like you might save ten or fifteen or twenty five percent for the end of the project but you actually don't deliver everything until that last ten or twenty five percent or whatever is paid that's the key the last payment is hard to get the retainage often is not collected and there has to be some way that the freelancer can assure be assure that they're gonna get that final payment before they release the full project now this is a problem that freelancers have been facing for a long time because the pattern seems to be that a lot of a lot of business owners maybe will invent reasons not to pay the last payment whether it's the last 10% or the last $5,000 with West yeah last five dollars whatever it happens to be but you were telling me that there was recent law changes in New York State and and if I remember correctly you were saying it reminded you of the Uniform Code for landlords and tenants which is now pretty much universal sure like tats anyone that's dispossessed or in an inferior position to the muddied interest is going to be overreach meaning that you know you're the freelancer and the company that's paying you can basically do whatever you want kind of like how landlords used to be able to do whatever they want over their tenants that's right so what what the New York City Council did about three four years ago is they passed some enabling legislation which allows a regulatory body in New York to set standards for freelancing and I think the idea of it is to identify clients who typically run over tenants or freelancers run over in this case run over freelancers so once you can identify the the problem the deadbeats then you can cause it is helpful yeah so and it may be not so long before we start seeing laws like that everywhere which would be good for freelancers probably if we're gonna move into a freelance economy I would hope so there there is a woman that I want to bring up at some point who is a labor lawyer and in 1995 she'd graduated from law school and she went to work for a law firm and she thought she was going as an employee but she turned out to be an independent contractor which had implications tax implications health benefits implications and so from that experience of being an independent contractor as an employer she began to organize independent contractors and then later freelancers she formed what's known now is the freelancers Union and they are based in New York in Brooklyn and they have a website Twitter accounts Facebook accounts and they're very active in consumer or freelancer protection though your audience might take a look at her in her websites but also her book she has a seminal book written in 2012 it's called the freelancers Bible and it's a excellent compendium of everything you need to know about freelancing had it from how to form the contracts to how to manage your office and I read it and it was very helpful and it will advance someone without any experience five years I think what was her name again her name is Sarah Horowitz hor OWI TZ and we've added a link in the description below good now we talked about the the emails and how you want to be very specific about what the job is and you're probably gonna be meeting with these people a lot and hammering out like I'm gonna bill you this for this and a lot of people are gonna underestimate how much of an investment that is like you're gonna spend so much time before you even start working so what would you say should you bill for that kind of work for the meetings for stuff like that how do you think is a good way for freelance for handle a can I think well you definitely have to be aware as a freelancer that meetings are gonna be necessary that's frequent and if you if my thinking is that if you build for that some people will avoid having a meeting because they don't want to they don't want to pay the $100 it's going to cost for the meeting and so they find other ways to to talk with you or just conceal their need for a clarification so you need to build it into your pricing but I don't know that you specify that that you were just charged $100 for me it's uh it turns out that you know that's something that I definitely think I still struggle with because what seems to work pretty well is in the project to be like okay this is going to be a two-week project and it's going to take this this and this we'll just go ahead and pre-scheduled this number of meetings and just build it into the car that way but then if there's excessive meetings then bill for that because you're kind of damned if you do and damned if you don't in terms of billing and meetings and things like that because you will have the people to try to retreat into not communicating which puts you in a worse spot but you still need to take that brain time to figure it out because as much as you spend your time doing work you also spend a lot of time figuring out the problem and solving the problem and helping the client to find the problem and I definitely see that as billable yes and I think you're a very good one to let going the extra mile for a client and then at some point you have to say to them yeah I went ahead and did this meeting for us or I did this extra work but if I'm that long yeah this is going to be a an added cost and you express it in some unit that they can understand for our next question how would you how should I define my scope and my goals in the contract is there like any sort of way should I to my zit or should I just put all in paragraph format or like what is the best way to approach that you think well I think that in the normal contract I think a written contract do you have a statement of work is that your experience and and in that you provide some context for the job you know I'm going to edit your book gone with the wind and then you proceed to to state or outline what editing includes so you have to define what you're going to do and it's helpful if you also had some where what you're not going to do this does not include and this could be in emails but preferably it would be you know in a contract well for large and complicated things it can be a it can be a huge paper trail to keep track of all the different emails and you know depending on one person's interpretation so it's it is periodically helpful I think to just you know we clear monthly send a thing that's like this is where we are this is the status this is everything it's done this is everything that we're not going to address this is everything that we're going to do sometimes the client will introduce new work and then you have to say okay that's new work that's gonna be a separate billable item but it can get messy fast right so is it is it is it worth the effort to stay on top of all that just to avoid confusion later well it's crucial or you're not gonna be paid with what you're owed because everyone wants you to not only write their book but design the cover and you know distribute it and they'll even ask you to come over and take the boxes to the race like line yeah well I have been on the receiving end it's like well you know if that thing was out of scope why did you do this other thing well I just did that other thing because I'm nice but now that is perhaps it remind me to never be nice again I get that a lot as a designer where someone will send me something and then they send me the copy and I never touch copy because I'm not an editor that's not for me to touch and they're like well they're a bunch of misspellings in there so I'm like well I'm not your editor I'm gonna designer you need to send that to someone else that's not my job but it's not in our scope and if you'll refer to the engagement letter it says we don't do editing so well one way to solve some of those problems is to say this is the entire grant between the parties the last part of your contract usually says this and nothing outside of this contract it forms the nothing outside this document forms a new contract unless it's signed by both parties in writing so so the idea would be to the first document incorporates all the agreements all the emails everything and that nothing nothing else is involved in the agreement or in the contract but then as you need to change it you just say this is a new contract where this is an addendum to contract of February 10th 19 2018 and the new agreement is as follows and then you just list what you've agreed to do for its in terms of scope of work now something interesting that's coming out of our conversation is that a lot of would-be freelancers may assume that these contracts require a lot of legalese but it sounds like just a plain you know one or two page letter that's like this is what I'm gonna do here it is that that would suffice for a contract that in a lot of cases you really don't need a lot of impenetrable legalese I think that's right depending on the the amount of the contract and depending on your view of the of the client I mean some clients are gonna present badly and you may have to protect yourself they're gonna ask for the moon yeah yeah so it sounds like for the scope creep end of it that handling that just through revising the contract and you know sending the updated things like that we all agree that this is gonna be the additional work that we're gonna do and this is gonna be the additional costs just having even an informal email like that if it doesn't rise to the level of something else that that would be sufficient as the scope of the project changes I think that that's well said once it's outside the scope of the work there's you view it you need to send them something saying this is outside the scope of the work I did this but we're not gonna be doing that next week we're gonna have to do this next week where I have to charge you more so one of the big things with software that probably doesn't affect a lot of other kinds of contracts is who owns it if I build it for somebody else is that there is is it mine and if they try to make it theirs and they have the code is there anything I can do about it what would you suggest for sort of protecting yourself there and making it clear well sometimes these are big decisions because it can let's say you have a copyright on a book and somebody wants to use this book in their business and sell 2,000 copies of it or something they somehow incorporate it into their advertising we you don't want to give them the copyright to the book you want to give them rights to publish it but you may want to use this book or the content that you've been working on for two or three years you may want to use it in a dozen papers that you write later you may want to incorporate it and fold it over into a whole new book and for sure with a software you don't want to give away your software you want to license it and keep the copyright keep the rights to it so do you have any suggestions about its language to include just put that in writing are you saying well sometimes as one de Mo's these these are these are big issues and some large large deals and so you you definitely have to get a patent lawyer and consult with them they're really good at drawing up contracts I struggled in early days not knowing what what the language was copyright is a special special area of law that general practitioners don't know anything about and so getting a patent attorney is very important to protect your eyes but generally if you're gonna be a do-it-yourselfer just he just one which we all do we just want to give them a license and we want to keep ownership of that software so you can use it on other things yeah it would be like asking a carpenter or a drywall or to give up their tools is how you can explain it to your clients or your website would be Claudius that's a good example so usually just in those simple friendly one-page emails I think you know in the in the early days just the one lines like you have a worldwide perpetual non revocable license to do with this code as you please but you know we we retain the ownership or I retain the ownership or whatever and that generally works pretty well for the open source licenses like the GPL version two you know just a statement that any work done will be licensed under the GPL version two because this work is based on other work that's already licensed GPL version two or three-year MIT license or whatever and so usually the conversation with the clients not too hard because it's like well I'm doing work for you you don't own the code we're just continuing to license the code the same way that you know whatever is based on is licensed as usually that's sufficient that's not really like if you were doing something really expensive definitely see patent attorney and help them get it sorted out but for pedestrian stuff it's fine what do you do this is the question everyone has been fast forwarding through the video to find is what do I do if the client doesn't pay me panic that's usually what I do only see a post on reddit every other Bank where like somebody has said a client's website on fire and there's just like animated gifs in the background and it's like oh you didn't pay me after I've just oh that's not okay yeah you need to prepare for for that event from the beginning of the contract I think and I'm sure there are ways that you have four websites that you can not you can have the website as demonstration only but it doesn't go live until you're paid and I don't know I'm sure most people technical knowledge know how to do this it's the easiest way to do that nothing motivates payment faster than we need this to do whatever is like great send me Jay yeah we'll play my credit card because you know even freelancers can take credit cards now and that makes life a lot easier in some ways actually so yeah it's definitely so it's it's it's what you say that it's if it's not okay to really do anything with it if it's already on servers or whatever owned by the client that what that worries me as you know I think once what's the once the horses escape yeah what what's the websites up and going and you come along that a month later and you haven't been paid in the 30-day time period and you start turning off somebody's website your lawyer better be up overnight or preparing a motion for declaratory judgment or something and filing at the courthouse the next morning because the the clients going to be upset that their websites turned off so that's a risky so what would you do yeah can you do that I seem you probably you shouldn't I don't think I think that the damages are too great really to turn someone's website off once it's up and going a judge would frown on that too I think it's just just the akley between the parties would say well this is reducible to well the client is going to claim loss of income and that's another thing in your contracts we need to talk about at some point ISM is talking about what happens if the contract is terminated and/or that someone's in default or the damages and the freelancer doesn't want to have damages outside the scope of the contract you want to try to limit it to the amount of the contract if you can yeah so what what you mean I think is just having another just a one-line statement you know in plain English that is you know I'm not responsible for anything beyond the fee collected from the client so if you do a $5,000 project and the client pays you $5,000 and then something crazy happens later and the client wants a refund they can't demand ten or fifteen or or twenty thousand dollars for having to redo whatever you did and you know asking for damages from having to find somebody else to do it in whatever right we call that a liquidated damages and you put that in the in the contract if there's a default what are the damages gonna be and then you can just spell out what they can be they won't exceed that value of the contract the worst case scenario you only have to give the client a full refund and not more than that because that would be bad for business if you have that in writing his liquidated damages you can do that and then there are two other variables the to kill fee which enables anyone to get out of the contract for a price and it would be nice if the freelancer has a death in the family that they could and just can't work on the project anymore that they could get out of their contract you can write that in that in the event of default of either party the amount to be paid to the other is a thousand dollars or ten thousand dollars or whatever now there are also some freelance services like up desk and I don't know I can't think of any other ones there are websites that will hold that money in escrow for those types of arrangements but right those are typically for you know jobs and scope of like five thousand dollars or less I would say so pretty pretty protest Rhian those platforms are nice and I'm amazed at the uber platform and the Airbnb I mean those work really well for people for for both sides it seems like some freelancers have found those platforms useful in situations where it is difficult to get paid because you can lean on the platform to either ding the clients rating or do give the clients some other incentive outside the contract to pay but assuming that that fails or the contract fails and the client is just gone completely unresponsive I think you mentioned that it usually doesn't come to a court case usually it would be something like arbitration first and then maybe a court case maybe small claims as an option what are you doing those scenarios well mediation is a it's a nice way to resolve disputes where mediator provided by the platform or you can work with the mediator as a both the client and the freelancer can work with a mediator and just present the case to him let him make some suggestions like he mediate a dispute between husband and wife and the mediator middle-schoolers and the mediator then makes a suggestion and hopefully that would would resolve it and usually it does it is interesting that freelancers Union has did a survey of their members 44% of their members had difficulty collecting accounts over the course of 2010 so it's a real problem and how to get paid is an art there's definitely a few times where you know I was having trouble with collecting payment and just sending the emails like hey I believe that I've satisfied everything here I haven't heard from you I would like to open up arbitration or you know have this arbitrated here some people in the area that can help us arbitrate this dispute please respond with sufficient to actually get final payment just because they were like I don't really want to fool with this right visit oh if it does eventually you know if you wanted to go to small claims court or something like that does it look good if you have the documentation to say well I'll try to do arbitration to resolve our dispute but they didn't really want to do that so here we are sure I think that it helps a lot in small claims court the limitations of small claims court generally are that you're contracting outside the state so it's hard to collect in a small claims court in your state when you're suing someone in a different country or would you have any other advice for would-be freelancers or anybody new to the freelancing world that hasn't gotten there hasn't taken their lumps yet well I think you have to get your feet wet without some experience it's hard to read and understand what these books are talking about but now there's a lot of information on the internet under freelancer most of it's terrible probably so but reading a book like the freelancers Bible that will advance you in a number of years and your experience level just by reading these cases but the important thing is to network and to because you don't want to get on Fiverr you don't want to get up watch if you can have clients for your networking your associations with other people that you went to school with that that you know in business you keep showing up showing up is so important in death that's gonna be the hardest thing in this video it's like our audience is so antisocial and I have a sign I like that too he's an IT well let's say one final question let's say that you're finally getting the projects that are big enough or you're simply so overwhelmed by this that you need to go for legal help what can they expect to pay what kind of ballpark are they looking for for basic services to take care of these kinds of things one's gonna need a retainer well it depends on the lawyer you go to obviously it if you go to a boutique that's one or two people and you're your town you're probably going to get a free consultation and you're gonna get a yes or no whether they know much about freelancing law and whether they're willing to write letters for you and sometimes relationships can develop where you take care of the computers of the lawyer for the first month and then he writes a few letters for you and then he realizes he can't live without you and then Windell owns all the lawyers yeah because he just you know once you taste Wendell's magic potion you know gonna drink anywhere else so basically you're saying barter maybe as a way to get services barter is not ideal but certainly just doing somebody a favor can come back to enfold so don't hesitate to help your clients if you're a freelancer going that extra mile doing extra work when you're young knowing that you're learning how to do it yourself and you don't want to have the client completely pay for your education you know you you want to have some bag of tools before you start working and offering your expertise so so do that giveaway free giveaway work and and help charitable organizations and nonprofits give away working the right people well now one don't will I mean I've seen him give a whole computer lab to a school in Eastern Kentucky you know just I mean there's you know pretty bad well of course you're always gonna get burned by a well-meaning clients you know they don't they don't understand oftentimes your business so you have to educate them let them know that you can't be doing this free work all time all the time there's so much to living other than just technology it's crazy you know well thanks for coming on it's really interesting maybe it's for you guys have any other questions might be there we can do another follow-up video sometime in the future so let us know\n"