Freelancing – Acceptable Payment Terms for Contractors

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I'm wondering whether or not I've done the right thing as a contractor. Basically I'm in to my 3rd month, and my current client messed up the payment in the first month, and I just found out that they are again late in paying me for my 2nd month.

It wouldn't be so bad if I wasn't in a bit of a financial situation due to this being my first contract experience. But as a matter of principal, I walked out on them and will be telling them that I will not be going back in until they resolve the pay.

Part of me feels as though this was not a very professional thing to do, but I also don't feel that it was very professional for them to mess my payments up, twice in a row.

Did I make the right decision? I still want to work for these guys and enjoy the job, but I have a life to attend to that requires finances and I can't afford to keep getting messed up with pay like this.

I attempted to phrase the question to be oriented around contractors behaviour around clients that mis-treat them, and as some of the answers that have been posted so far, it's a good discussion. The answers coming in are great around different subjective situations.

Update:

In answer to some of the responses, the set-up is Me -> Umbrella Company -> Client. I am an employee of the Umbrella Company who's terms are that I do not get paid unless the client paid up. Thus, when I found out that the client was going to be late paying the Umbrella company, I was quite upset.

Also, I do believe that in THIS instance, it was a bad move to have simply walked out. The most professional way to handle it would have been to have made my issues known to my immediate manager and then let him resolve it, instead, his boss and others found out way before him and he was left with crap to deal with, with no chance of handling it before it got out of control.

If I was still unhappy with their solution, then I could of told the Umbrella Company that I wasn't happy and was prepared to walk out, which then they could of advised me in a more professional way what my options were. Later which I found out, there were lots of other more professional ways of handling this. However, I've not contracted for long and had a very emotional response to the situation that I've not been in before. I'm positive that a more professional and mature response would have been anything but simply walking out, creating a difficult situation for my boss and now other people in the company and myself.

Absolutely great answers so far. Thank you all for your experienced advice.

Best Answer

I don't believe you did the right thing, honestly. If you truly enjoy the job and want to work for these people, you would not have resorted to burning a bridge with them. Pay issues are always tricky, and it's not terribly professional for them to have botched your pay in the first place, but the question also relates to a definition of severity. Did they botch your pay through some administrative (re: fixable) situation or is the company having financial difficulty and unable to pay? If it is simply administrative, you should have brought the issue to their attention, asserted the importance/severity of the problem and allowed them to address your concerns in a more suitable and professional manner. By walking out, you have shown yourself to be completely self-serving and not particularly dependable (in their eyes). It does not matter that you had a good reason for walking out, they will only notice that when the chips were down you were not there. Contracting in this manner is a very political game, and in politics perception is everything. It doesn't matter what the truth is, it only matters how they perceive it.

On the other hand, if your pay was botched because of financial difficulty, creative accounting or any number of other underhanded financial tricks that many companies pull just to avoid spending the extra dollar right this minute then you've made the absolutely right decision. This would not be a client you want to have. The problem will only continue and worsen until you are essentially working for free.

I believe you should always value your work, and you should never let anyone take you for granted. The contracting game must be handled with a little more delicacy in demeanor though. Sometimes a little patience and understanding can breed a good business relationship, particularly if the company you're working for is made aware of the situation they've put you in and learned that you stuck with them through it. Think of it this way: How far would you go for someone who did that for you?

All of that being said, if you're experiencing financial difficulty then contracting may not be the ideal option for you. You need to be able to budget these little fiascos into your life. Not everyone will be able to pay you immediately. They're not bad customers, they just don't have the luxury of paying right this minute. If you can't handle a 60-day swing in pay, you may not survive long as an independent contractor, and you may consider trying to latch onto a larger contracting firm that can broker jobs for you.

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