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Self-employed and not getting paid? Find out how to deal with late or non-paying clients  

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If you’re currently self-employed, you probably chose this path because you want to have more freedom over your work, maintain a better work-life balance and enjoy the life changing perks of being your own boss.

However, you probably also know by now that being a freelancer isn’t all fun and games either. You need to find work, muster the ability to motivate yourself and, perhaps the worst of all… deal with late paying clients.

Does this already sound familiar?

If this reminds of that dreaded folder with overdue invoices, know that you’re not alone. Late payments are a common challenge that freelancers both here in the UK and all over the world are facing. In fact, one study shows that 50% of freelancers and independent workers are not getting paid for their work on time or not getting paid at all. The average delay on payments against outstanding invoices is 52 days, which is not only bad for your financial stability, but the economy as well.

Other studies show that unpredictable income is the predominant concern among freelancers, after lack of access to affordable healthcare.

When you work in someone else’s company, you don’t have to worry about not getting your paycheck because even if your employer somehow refuses to pay you, labour laws will protect you. As a freelancer, however, employment legislation does not apply. Seeing that a client refuses to pay the invoice after you’ve given your best effort to complete their task can be very frustrating, but it’s important not to lose hope.

Never work without a contract

Providing services solely on a contract basis is one of those healthy habits that you need to pick up as soon as you become a freelancer.

The contract is a legally binding document that mentions crucial details such as who are the service provider and the client, what services you will be offering, for how long, and in exchange for what fee. It also mentions other terms such what happens when one of the parties breaches the contract. Getting everything in writing is the easiest way to protect yourself if a client delays paying the invoice because you have a legal document proving that they agreed to pay you. Even if drafting a contract might sound complicated, you can always find downloadable templates and fill them in.

If a client refuses to sign a written agreement and asks you trust them, do yourself a favour and say no.

Stand your ground

Although things are slowly beginning to change, many clients still believe that “exposure” is a valid payment method. Well, it’s not, and you shouldn’t let your client assume that you are volunteering. Before accepting any task, set clear payment terms and always let your client know that you expect being paid on time, in the same way that they expect you to finish the work on time.

There will always be exceptions and sometimes factors such as national holidays or family emergencies will delay payment for a few days, even for clients who usually pay on time. However, if the client continues to give you excuses or refuses to pay a milestone, stand your ground and make it clear that overdue invoices are unacceptable.

Clients who do not view you as a respectable business partner can make you lose confidence in the value of your work, so learn to be firm, while still maintaining a professional attitude.

Dispute resolution options

Many times, clients do pay the invoice after you tell them that you do not accept working for free. However, if you can’t reach common ground or they don’t respond to your emails, there are two dispute resolution options that you can try:

  • If you work on a freelance platform, get in touch with customer support. After reviewing your project, they may be able to compensate you.
  • Contact the National Mediation Helpline, where you can sometimes solve matters without filing a claim.

When to resort to debt collection

Unresponsive clients and overdue invoices can have lasting consequences on your productivity and cash flow. Apart from the immediate problem of not being able to pay your bills, you may begin doubting your career choice or put other plans on hold for fear that future clients will do the same thing.

However, there are ways to get your money back. Contrary to common belief, going to the County Court route or small claims court isn’t as helpful as you might think. On the one hand, these institutions have extremely timely procedures and you may not have the time to wait. On the other hand, they’re not affordable in the slightest.

Before getting your money back, you may have to pay other fees and, with cash problems already there, that could send you down a path of debt and stress. What you can do, however, is to contact a trusted debt collection service. When you’re self-employed and not been paid, agencies such as Frontline Collections, who are leaders in debt collection, can help you get your money back on time, and with minimum fees.

How to help other freelancers

After getting a hold of your client, or solving matters through a debt collection agency, you will probably want to leave this bad memory behind and continue your freelancing journey with other, more professional business partners.

And you’re partly right. The freelancing market is huge and you’ll find many other people who respect your work, but, before you move on, take the time to leave a review and talk about what happened. So many clients get away with being late payers because freelancers do not spread the word and even give them five stars on freelancing websites.

If you had a negative experience with a client, share it in your network. Become a part of Facebook or LinkedIn freelancing groups, where not only can you get valuable recommendations on finding work, but also discuss late paying clients. This way, the business owner who refused to pay you will have fewer chances of fooling someone else.



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