{D} You + Them Vs. The Problem
Break in case of client disputes
Hey there from the high valley of Mexico City. From time to time in these letters (read: very occasionally) we talk about the business of being a solo provider. This time, we're talking about how to handle payment disputes. This is a topic that is more often informally shared in group chats and slacks vs. written about, so I thought it might be valuable to collect some of the wisdom from over the years. Comporting yourself well when a disagreement arises is not something that's usually taught in the creative fields (is anything taught in the creative fields ??). But being a considerate and respectful partner is a measure of maturity and grace, and is a skill that will serve you well in business and beyond. As the saying goes: work hard and be nice to people. -s.I am very concerned, from the jump, that you not misunderstand this post.
This is a post about how to behave when you have a disagreement with a client about money.
This is not a post about recrimination, imputation, accusation or getting even, nor is it about bitching or moaning or whimpering or weeping about the difficulty of working with other bones-and-butts humans, nor even about cruel chance, unfair winds, or seas that fail to follow.
Rather and to be certain: this is a post about how to behave.
And this is also very much a post about how not to behave, very much about what you should not do, were the unfortunate circumstance of a disagreement to unlimber its long-legged nonsense before you.
In final, this is a post about being an adult.
And so. Dearest adult—and please realize, that this is as much me talking to myself as it is me talking to you—should you ever have a payment dispute with a client, might I suggest you take the advice tendered below:
In any payment dispute, remember that the other party isn’t the problem. It’s the disagreement between you and them that’s the problem. You’re on the same side against the problem.
Let’s break it down below.
Work long enough as a solo provider (or, really, any field) and, eventually, you’ll encounter some type of payment dispute.
Payment disputes happen for one of several reasons: scope creep without formal change agreements, disagreements about “definition of done”, timeline disputes, value perception about work completed, or documentation gaps—i.e., lack of clear written agreements about payment terms, deliverables, or change requests, leading to conflicting interpretations. All of that.
This can be scary! It’s nervous-making enough to work independently, and more so when payment terms are called into question. The dizziness of freedom and the opportunity to work on exciting projects can be (will be!) counter-balanced by the reality that you, and nobody else, are responsible for your success. It’s a cliche, but worth repeating: nobody is coming to save you.
Payment disputes are also scary for clients. They hire providers to do work they can’t do or don’t want to do, which puts them (and you) in a position of trust. You’re both trying to get shit done, and you’re trusting each other to collaborate towards that goal. (Just remember: the best way to avoid disputes is to invest in the pre-agreement and agreement phase before work ever begins. Good partners understand each other before the first pixel is pushed.)
So with that in mind, the advice below is meant to assist whenever you have a payment dispute with a client, regardless of the specifics of that dispute. I hope it’s helpful to you, as it has been occasionally for me over the years. But I imagine, in the depths of your freelancing heart, that you already know it. “Advice,” as Erica Jong once wrote, “is what you ask for when you already know the answer but wish you didn’t”.
Begin with a charitable interpretation.
When a dispute arises, react by interpreting the other person's statements or actions in their best, most reasonable form. Assume the most favorable and rational interpretation of their words and deeds. Remember that multiple interpretations are possible. In other words, don’t assume someone’s trying to screw you. Odds are they ain’t, and the benefit you’ll gain from being a level-headed partner will far outweigh the ill will you’ll create acting otherwise.
Realize that a dispute is a negotiation.
You want something, they want something. You want the price of your services, which were set in the agreement both parties signed (you did sign an agreement, and the agreement was clear, right?). They want value for the time and expense, and/or for you to deliver what they thought you were supposed to deliver. The best way to get what you want is to treat the other party with respect and try to find some common ground. Don’t make the mistake of being inflexible, e.g., thinking the other party must give you something. It’s likely both parties have a point.
Make sure you have the facts correct.
Before you ask for what you want, review all your communications and your agreement. Doublecheck that your position is factually correct and therefore tenable. Be honest. As a solo provider, your business is based on your reputation. Unless you want a reputation for being dishonest, don’t be. If you have any hesitancy at all about your position, explain it to a good friend or another trusted solo provider who’ll be honest with you about your position.
Confirm where the difference in payment lies.
Make sure both parties agree on what the dispute is. Confirm this in writing. This is important, because you don’t want to compound a difference with a misunderstanding. And, moreover, you want your counterparty to agree with how you’re framing whatever difference exists. For example, an email might look something like this:
I wanted to recap where we are at.
Earlier this year, you reached out to engage me on X.
As it stands, I have completed the work, which your team has accepted <talk it up, focus on the excellent result you delivered and how well their team responded.>
For this work, we signed an agreement with CONDITIONS A. <copy / paste or screenshot the language from your agreement>.
Your position is instead CONDITION B. <recap what they’ve said, write it so they nod along saying yes that’s right>.
Thus we are apart on DIFFERENCE C.
Present the facts without judgement.
Communicate over email (and then phone/zoom, if possible) how you understand where the disagreement lies. Do not judge your counterparty. Do not use accuse them. Lay out the facts as calmly as possibly. Behind the scenes you may feel you are being unjustly treated, but if you want the best chance of getting to an equitable resolution you can’t let that emotion show (and you certainly can’t blame the person you’re talking to).
Hear them, and make sure they feel heard.
Repeat your client’s point of view and acknowledge what they’ve said. You want them to feel that your outline of the situation is fair. On one hand, that’s just good communication. On the other hand, if they don’t disagree with the facts you laid out, that’s a point you can return to later on.
Don’t get angry.
There is no advantage in being angry. When you’re angry, the person you’re negotiating with is more likely to get defensive (won’t help negotiations) or dismiss you out of hand (won’t help negotiations). You want something from them (e.g., your payment), they want something from you (e.g., for you to go away, to think they’re being fair, etc.). Both parties are more inclined to give the other what they want if anger doesn’t cloud the issue. Remember: the other party isn’t the problem. It’s the disagreement between you and them that’s the problem. You’re on the same side against the problem.
Ask: How might we resolve this?
This is a key phrase. You’re not accusing them of doing something wrong, you’re asking them to collaborate with you on a solution. By asking them to work together, you’re relieving them of the emotional burden I did something wrong. Shame: not a great motivator! Psychological safety: much better motivator!
I would like to get a resolution that’s fair and win/win. And I would love to hear your thoughts how we can get there.
fwiw, this is what you also say to cops in Mexico when they’re trying to shake you down! Como podemos resolverlo? But that’s a story for another time.
Be cordial, friendly, but firm.
This is a corollary to don’t get angry. Practice being cordial even if your client isn’t. But, don’t back away from your primary assertions and know exactly what number (or terms) you’re willing to accept.
Legal action is a (very) last resort.
Don’t mention legal remedies unless you’ve truly exhausted every other avenue. Lawyers aren’t coming to save you, either.
One attorney friend put it to me like this:
Nobody likes lawyers. We’re expensive and mean. If you’re really at the end of the rope, say something like “If we can’t come to an agreement we might have to bring attorneys into the conversation, and neither of us want that. What do attorneys know? Nothing. We can figure this out together instead.”
Earlier, I said that you wanted to position the disagreement as you and the client against the disagreement. With regards to the topic of lawyers, same thing: it’s you and your client against the lawyers. This is a good position regardless of whether you or your client first mentions bringing legal into the matter.
Ideally, you can negotiate without ever mentioning a legal remedy (and good lord certainly don’t threaten it). Freelancers often assume that their clients have more money and more resources to negotiate with attorneys. That can be true! But, it may be the case that the client doesn’t want to use lawyers for any number of reasons (it’s inconvenient, costly, etc).
If you feel like you need an attorney, get a referral. The first conversation is free (they can’t charge you for what is, essentially, them interviewing for a job). Make sure you understand what the process and fees are.
Be patient.
It’s likely you won’t get what you want immediately. Be prepared to wait for responses. Be prepared to send follow-up emails. Be prepared to end phone calls without arriving at a resolution, but also without ending the conversation. “Let me think about it” is always a fair thing to say. My father, a lawyer, has a great piece of advice here:
When I was a young lawyer, I used to rush towards a conclusion. Give me what I want, now! But when I had more experience, I realized I left a lot of money on the table. If I had been willing to wait, to send an email later, to give them time to think about what I’d said, then I would’ve been more likely to get what I wanted or close to it. The longer you keep negotiating, the more of a burden it can become to your counterparty. So keep negotiating.
And so.
All that said, it’s my sincere and honest wish for you that you never have a payment dispute with a client.
If you do, comport yourself in the same professional manner that you bring to the rest of your work.
And go easy.
-s.
p.s. If you benefited from this piece, you may also enjoy this popular piece from a few years back: Put the resistance to work for you: Shame, neuroticism, and some armchair therapy for clients. 💕
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What confounds a society is not serious opposition, but the lack of seriousness altogether. Generals can more easily suffer attempts to oppose their warfare with poiesis than attempts to show warfare as poiesis.
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