6 ms·

Just throwing this out there since I know the common wisdom is to "have a contract, duh". I have a few clients who basically put me on a retainer, then I send

by fat0wl 13y ago

Just throwing this out there since I know the common wisdom is to "have a contract, duh". I have a few clients who basically put me on a retainer, then I send them a bill. If you give an hourly rate + an estimate clients seem to be cool, provided they are actual businessses. The only clients I've ever had issues with are individuals (usually artists since I freelance electronic media) and that stems from budget / rampant psychotic narcissism. But with businesses, I state my rate I estimate hours & then I bill them. I'm sure there is a more secure way of handling this with contracts but if a company I work remotely for ever stiffs me on a bill: 1. They better be closing up shop the next day or I'm gonna come after them hard. 2. They lose access to the skills I offer them. 3. I probably have accounts/services in their name that they can't alter/operate without my help, so they're really just shooting themselves in the foot & will likely come to realize this rather quickly. Anyway worst case scenario I lose 1 payment (maybe it was 1-3 grand?). Maybe it's scary to think that a 3k payment might disappear but the reality is, after discussing with them they'll probably just hand it over anyway or you can settle in between. Even if I one day lose a thousand dollars (which I highly doubt) I can look back and smile knowing I never had to deal with a ton of legalese. The reality of it is that businesses can't just stiff you on a bill if they agreed to pay for your services, and if you have nice clients who are trying to build a business they have no reason to hurt you if you do good work for them. But I understand not everyone has the luxury of sane clients. I certainly didn't back when I was dealing 1-on-1 with artists.

LukeShu 13y ago
> The reality of it is that businesses can't just stiff > you on a bill if they agreed to pay for your services That feels like it should be true, but it's not. I'm not just speaking about software; a large portion of my family is in construction, and I'm shocked at how often client businesses think they can get away with just not paying them. Perhaps it actually is better in the software world, where clients (hopefully) know they are going to need you in the future. Anyway, good for you that you can find clients that know they need to pay you; but not all businesses have figured that out.
- eli 13y ago
  Years ago I worked for a mom & pop computer consulting shop and I was surprised by how many small businesses just didn't pay their bills. Anecdotally, we did a lot of work with local law firms and they were the worst. (I guess because what're you gonna do? Sue them?)
- fat0wl 13y ago
  Hmm I'm sorry to hear that. :-/ But if they brought a civil suit they would win easily, no? That's what I really meant by that line. My father is a lawyer & every time I bring up something like that to him he laughs. "Of course they have to pay, it's just too much trouble sometimes. Usually just the threat of legal action is good enough." Maybe it's not so simple but that's a shame.
  - LukeShu 13y ago
    Oh, yeah, they eventually get paid. It's just shocking how many people try to not pay them.
enobrev 13y ago
I agree with this, completely. During the first 5 or 6 years of my 10 years of freelance, I almost never had a contract in place, and I _never_ got fucked over for it. That's not to say it's OK to avoid contracts. Only a single set of data points that says it's possible to do business without them and still do very well. Of course larger clients will generally require them to cover their own asses. And any project that's over x, where x seems like a good deal of money, should _always_ be covered by a contract - both for your safety and the safety of your client. But the cynical idea that everyone is out to get you is silly. Yes, get a lawyer to get a solid standard contract together for you. But then pay attention to the clients you're dealing with. A contract gives you a legal standing in court, but you still have to go to court. There's a lot more to be said for choosing clients that aren't going to cause trouble in the first place.
- fat0wl 13y ago
  all good advice. I've actually had issues working with larger clients because they try to give all-inclusive project prices. For one I fulfilled it and weaseled into off-contract hourly rate and that actually worked out much much better for me. If you give a tech consultant a job they will code from A to B. The client is always the one throwing up roadblocks and change requets. If they don't understand that they are on the hook for those billing hours, yeah you don't have a good client there... ONLY USE HOURLY RATE + ESTIMATE that's the best advice I can give on top of enobrev's. Maybe others disagree, but in my experience project rates mean the client will try to take advantage or if you get a project price that seems absurdly high & you get that flash of $$ signs in your eyes, the client will usually realize they overpaid and you'll lose potential future business with them. Just use a rate and be somewhat ethical about it. Even if you don't have a huge client base, they will all come back around for more work every few months.
napoleond 13y ago
I probably have accounts/services in their name that they can't alter/operate without my help, so they're really just shooting themselves in the foot & will likely come to realize this rather quickly. Just as a counterpoint to this, it's possible for a client to not pay you for services rendered and sue you for not maintaining previous accounts/services for them, and the courts might very well take their side, depending on the specifics. Whether there is a written contract or not, there is a contract when you agree to exchange services for money; the only difference is that if it's not written and a conflict arises, you're depending on the court system to guess what the agreement was based on the word of two opposing parties. I understand what you're saying though; realistically a lot of work gets done all over the world every day without written contracts, and everyone is okay. My general rule of thumb is to never extend more than a few thousand dollars of credit to any client without a written contract, and less if the job could involve any sort of extra liabilities. For a retainer-style agreement like the one you describe, I like to have a contract in place from the get-go, but with the "terms of notice" set so that things like email count--that way, if we ever negotiate for a specific project I can do it over email and count that as a written record of our agreement should the need ever arise.
- fat0wl 13y ago
  Yeah it's not like I'd use a threat like "I'll disconnect all your accounts!" but if they have some EC2 instance they don't understand how to operate it does give you some leverage since they will be needing some admin done at some point in the near future. I really doubt they can sue you for refusing to perform maintenance on their systems since we as programmers do not become indentured servants simply from having done business with them in the past. Tons of high-end engineers leave big projects all the time with the attitude of "well, you should've realized I might not be around forever" and it hurts projects but that's capitalism, it's one of the few rights that give employees an edge in the market. If we never had an agreement for me to document all my work (extremely common) then the best they can do is say "hand over the keys" but they can't make you drive. If they're willing to invest in a new engineer's learning curve, the problems must be way deeper than 1 bill & you should've seen it coming, enough to write out a formal contract for that last bit. In hostile workplaces contracts should be the norm, sure, but I just try to avoid those situations to begin with. Good advice on the email bit, but I kindof just assume that those count as written records. Either courts acknowledge them or they don't I'm not sure that explicitly saying they do really changes much. Also, you say "there is a contract when you agree to exchange services for money" but if they don't pay you... didn't they already break that contract? Why would you have to do due diligence (maintenance) for someone who refuses to acknowledge your initial agreement?
tptacek 13y ago
There are worse things that can happen to you when you work without a contract than simply not getting paid. Contracts also set up liability and contract termination terms, and without that stuff in writing, you can end up in a he-said she-said situation over these issues. You should always work under a contract. I have a hard time seeing why anyone wouldn't.
- fat0wl 13y ago
  Eh, I appreciate the effort that is being put into this argument but the reality of it is that it's not for me. If I have to drive an hour to see my client or send a lot of things back & forth in the mail it's really just time wasted. A good professional relationship & a couple of emails is all I need for freelance. If you're talking about a long-term high dollar amount thing then sure, I understand. & the reason I don't use one is simple -- I have an hourly rate. Whatever contract we come up with would look like this: "__ is my hourly rate. You will pay __ times the number of hours I worked." This has long been established since the first 1 or 2 interactions with any client and I think is obvious for any hourly service worker. Within the tech industry this is even standard for a lot of corporate consultants (I happen to be one). For freelance, I provide work estimates but things change. All the comments I see on this thread are like "write a change order for each change, make sure you keep a record of scope". No thanks, not for me. I just give estimates, tell the client when we're going over-budget. If they seem concerned we can talk about it if they say "Keep going no worries" then I keep going, no worries. I'm not at all saying that contracts aren't useful, it's just that the tech industry is really fast-paced and often involves remote work. If you're really concerned about stuff getting ugly, ask for a contract, sure. But I would do contract with 50% deposit because who actually wants to deal with going to court. At least you'd have 50% to sit on & think. To each his own but I'm a programmer not a businessman. I net way more money streamlining my coding process than I do thinking about stuff like this.
  - tptacek 13y ago
    I don't write fiddly "change orders" either. I still work under a contract!
  - 13y ago

by fat0wl 13y ago

LukeShu 13y ago

> The reality of it is that businesses can't just stiff > you on a bill if they agreed to pay for your services That feels like it should be true, but it's not. I'm not just speaking about software; a large portion of my family is in construction, and I'm shocked at how often client businesses think they can get away with just not paying them. Perhaps it actually is better in the software world, where clients (hopefully) know they are going to need you in the future. Anyway, good for you that you can find clients that know they need to pay you; but not all businesses have figured that out.

eli 13y ago
Years ago I worked for a mom & pop computer consulting shop and I was surprised by how many small businesses just didn't pay their bills. Anecdotally, we did a lot of work with local law firms and they were the worst. (I guess because what're you gonna do? Sue them?)
fat0wl 13y ago
Hmm I'm sorry to hear that. :-/ But if they brought a civil suit they would win easily, no? That's what I really meant by that line. My father is a lawyer & every time I bring up something like that to him he laughs. "Of course they have to pay, it's just too much trouble sometimes. Usually just the threat of legal action is good enough." Maybe it's not so simple but that's a shame.
- LukeShu 13y ago
  Oh, yeah, they eventually get paid. It's just shocking how many people try to not pay them.

enobrev 13y ago

I agree with this, completely. During the first 5 or 6 years of my 10 years of freelance, I almost never had a contract in place, and I _never_ got fucked over for it. That's not to say it's OK to avoid contracts. Only a single set of data points that says it's possible to do business without them and still do very well. Of course larger clients will generally require them to cover their own asses. And any project that's over x, where x seems like a good deal of money, should _always_ be covered by a contract - both for your safety and the safety of your client. But the cynical idea that everyone is out to get you is silly. Yes, get a lawyer to get a solid standard contract together for you. But then pay attention to the clients you're dealing with. A contract gives you a legal standing in court, but you still have to go to court. There's a lot more to be said for choosing clients that aren't going to cause trouble in the first place.

fat0wl 13y ago
all good advice. I've actually had issues working with larger clients because they try to give all-inclusive project prices. For one I fulfilled it and weaseled into off-contract hourly rate and that actually worked out much much better for me. If you give a tech consultant a job they will code from A to B. The client is always the one throwing up roadblocks and change requets. If they don't understand that they are on the hook for those billing hours, yeah you don't have a good client there... ONLY USE HOURLY RATE + ESTIMATE that's the best advice I can give on top of enobrev's. Maybe others disagree, but in my experience project rates mean the client will try to take advantage or if you get a project price that seems absurdly high & you get that flash of $$ signs in your eyes, the client will usually realize they overpaid and you'll lose potential future business with them. Just use a rate and be somewhat ethical about it. Even if you don't have a huge client base, they will all come back around for more work every few months.

napoleond 13y ago

I probably have accounts/services in their name that they can't alter/operate without my help, so they're really just shooting themselves in the foot & will likely come to realize this rather quickly. Just as a counterpoint to this, it's possible for a client to not pay you for services rendered and sue you for not maintaining previous accounts/services for them, and the courts might very well take their side, depending on the specifics. Whether there is a written contract or not, there is a contract when you agree to exchange services for money; the only difference is that if it's not written and a conflict arises, you're depending on the court system to guess what the agreement was based on the word of two opposing parties. I understand what you're saying though; realistically a lot of work gets done all over the world every day without written contracts, and everyone is okay. My general rule of thumb is to never extend more than a few thousand dollars of credit to any client without a written contract, and less if the job could involve any sort of extra liabilities. For a retainer-style agreement like the one you describe, I like to have a contract in place from the get-go, but with the "terms of notice" set so that things like email count--that way, if we ever negotiate for a specific project I can do it over email and count that as a written record of our agreement should the need ever arise.

fat0wl 13y ago
Yeah it's not like I'd use a threat like "I'll disconnect all your accounts!" but if they have some EC2 instance they don't understand how to operate it does give you some leverage since they will be needing some admin done at some point in the near future. I really doubt they can sue you for refusing to perform maintenance on their systems since we as programmers do not become indentured servants simply from having done business with them in the past. Tons of high-end engineers leave big projects all the time with the attitude of "well, you should've realized I might not be around forever" and it hurts projects but that's capitalism, it's one of the few rights that give employees an edge in the market. If we never had an agreement for me to document all my work (extremely common) then the best they can do is say "hand over the keys" but they can't make you drive. If they're willing to invest in a new engineer's learning curve, the problems must be way deeper than 1 bill & you should've seen it coming, enough to write out a formal contract for that last bit. In hostile workplaces contracts should be the norm, sure, but I just try to avoid those situations to begin with. Good advice on the email bit, but I kindof just assume that those count as written records. Either courts acknowledge them or they don't I'm not sure that explicitly saying they do really changes much. Also, you say "there is a contract when you agree to exchange services for money" but if they don't pay you... didn't they already break that contract? Why would you have to do due diligence (maintenance) for someone who refuses to acknowledge your initial agreement?

tptacek 13y ago

There are worse things that can happen to you when you work without a contract than simply not getting paid. Contracts also set up liability and contract termination terms, and without that stuff in writing, you can end up in a he-said she-said situation over these issues. You should always work under a contract. I have a hard time seeing why anyone wouldn't.

fat0wl 13y ago
Eh, I appreciate the effort that is being put into this argument but the reality of it is that it's not for me. If I have to drive an hour to see my client or send a lot of things back & forth in the mail it's really just time wasted. A good professional relationship & a couple of emails is all I need for freelance. If you're talking about a long-term high dollar amount thing then sure, I understand. & the reason I don't use one is simple -- I have an hourly rate. Whatever contract we come up with would look like this: "__ is my hourly rate. You will pay __ times the number of hours I worked." This has long been established since the first 1 or 2 interactions with any client and I think is obvious for any hourly service worker. Within the tech industry this is even standard for a lot of corporate consultants (I happen to be one). For freelance, I provide work estimates but things change. All the comments I see on this thread are like "write a change order for each change, make sure you keep a record of scope". No thanks, not for me. I just give estimates, tell the client when we're going over-budget. If they seem concerned we can talk about it if they say "Keep going no worries" then I keep going, no worries. I'm not at all saying that contracts aren't useful, it's just that the tech industry is really fast-paced and often involves remote work. If you're really concerned about stuff getting ugly, ask for a contract, sure. But I would do contract with 50% deposit because who actually wants to deal with going to court. At least you'd have 50% to sit on & think. To each his own but I'm a programmer not a businessman. I net way more money streamlining my coding process than I do thinking about stuff like this.
- tptacek 13y ago
  I don't write fiddly "change orders" either. I still work under a contract!
- 13y ago