Has anyone got advice on how to deal with a company who will not pay up for programming services?

I carried out a small job for a webhosting company and completed it promptly and as per specification. The company (which I will not mention yet) said they had mailed the cheque out and i didn't get it some few weeks ago. They have been saying it will be sent out "some time" and I "will get paid". They then have made a couple of excuses which I suppose could be valid which is why I am being generous and won't sham em' yet and give them the benefit of doubt.

Why do some people think that programmers and designers don't have to pay the bills too? Because we do!

Name 'em and shame 'em Terry :)

Originally posted by The Laughing Cow
. . . . . . .Why do some people (webhosts especially) think that programmers and designers don't have to pay the bills too? Because we do! I understand your frustration. But, to group all because of the actions of some is, simply, wrong.



Me? I'd tell the whole story (especially the part of who they are) straight off. It could become a big step in obtaining your money.

I'd like to know this answer to as we've had over $200 worth of non-paying coding jobs this month (with another $150 unconfirmed but highly suspected).

The usual case is that all is fine, the work gets done and the client seems very happy. Once final modifications and a full test is done, we get to payment. That is when (this month at least) the client likes to do a disappearing act :(

As standard with us, all jobs over £100 need a signed contract before work is started (to protect both parties). These non-payers have all been small jobs where there is no contract and around 70% have been to clients in the US. Short of asking for 100% payment up front (not the best way to attract jobs) I'm unsure of what approach to take.

I know one of the non-payers (who I later found out to be a kid known for trouble on this forum) is now trying to get a new hosting and dedicated server business off the ground on this very forum. I'm just waiting for one of his 'offers' :)

It happens far to often...we did work for http://www.deepriver-ids.com and they have owed us 600US for over a year now :(

There is nothing that annoys me more than clients who don't pay their bill :mad: and I feel pretty bad for you guys who are owed money by unscrupulous clients.

I've heard all of the excuses under the sun and I've turned from a gullable fool into a hard-hearted b**tard when it comes to payments.

This isn't really going to help you recover the monies that you are owed, but this is what we now do.

1. We only offer credit to a few long-term clients. Even then, our credit terms are max 14 days. No arguments, no exceptions. Don't pay on time - site is switched off, emails stopped, no service until payment is received.

We make this clear to all of our clients, we do enforce it, and we've never lost a client by enforcing our terms - probably because we are totally upfront about it.

This might seem harsh, but long-term clients know that if there are any bugs we sort it immediately. We don't skimpt on servicing these clients and they know that even when they pay us we will still sort out any problems they have. We all know the "rules"

2. Every other client pays up front. We don't mean they pay in advance, we mean that they get to play with the programmes online to test it, but they don't get access to it until the bill is paid.

Again, we don't skimpt on servicing and if there are any problems we will sort the. We can supply references so that new clients can be sure that we really do offer back-up and bug-fixing long-term.

There are some exceptions when it comes to domain renewals because we sometimes forget to invoice clients in time and renew their domains....but these are the only exceptions.

3. Pursue the money. Don't worry about their credit rating. If they owe, chase it. In Scotland we have the small claims court. It's great when you can go there, win costs automatically, and (if you can get the details) freeze their bank account for the amount owed - doesn't make them very popular with their bank manager. If you win, and they don't pay, send the papers over to a collection agency and mess around with their credit rating.

Total bad-debts in over 3 years of business - £55 (about $80).

If you are going to implement fairly harsh terms you need to provide comfort to the client, but don't ever be afraid of implementing whatever policy you have or what you think is right for you. Just don't be ashamed of it, be upfront.

Also, it doesn't matter what is "accepted practice". You decide what is best for you. If you need to fit in with accounting periods then it's up to you to decide whether you want to be that flexible. We can work with a companies accounting periods but it's still - play with the programme online, check that it is alright and what you want - and when the invoice is paid we'll release the software. Until then, we will retain control of it.

If the job is more complex, split it up into development windows and make it part of the conditions that future development depends on payments being made for previous parts. IF they don't pay for each part in time they are just delaying the development of the next part.

Originally posted by halldorr
It happens far to often...we did work for http://www.deepriver-ids.com and they have owed us 600US for over a year now :(
Id's is short for idiots :D .

Run everything through Programming Bids (http://www.programmingbids.com).

They protect you by acting as the middle man. It does cost you $5.00 per project I think, but it's worth it. I have had several developers not complete a project and have received my money back.

When I find someone I want to work with part of my conditions is that they work through them. No one has said no yet and it protects both the customer and the developer.

Thanks for the advice guys, it's leading me to take a firm stand on this now. I spoke to the guy over MSN this morning and he said he will get round to it sometime. I personally think this is unaceptable and when I get the opportunity I am going to pursue and seek recovering my fees. Admittingly my fees are only £50 and i'm unsure whether to worry about collection agencies but will still consider it. A friend who did work for him said he was paid promptly so I am giving him benefit of the doubt and will not name and shame the company yet as I think i'm too nice for this and it could damage his reputation. I will reconsider my actions when I next discuss this with the chap and will offer payment facility immediatly via 2checkout if need be. :)

Terry, you have PM which may be of help. Good luck :)

Thanks taliesyn I got it.

Another thing I forgot to mention (and ask others opinions of) is this:

For a while its been a policy here that on every clients first job, no work is handed over until full payment has been received. In 95% of cases its as mentioned in PJamie's post: all work is done, the client gets to see a full online demo then payment is requested.

Now this is where recently the client just disappears and doesn't pay up even though they have not got the work.

One could say that if they haven't got the work then there's not a lot that can be done but I personally view it that they are paying for the time and skills and the actual script is the end product of this. Even if they don't end up with the script and run off without getting it and without paying then in my view they are still liable because they haven't paid for the time.

What's everyone's opinion of this.... time or script?

Originally posted by Jim_UK
Another thing I forgot to mention (and ask others opinions of) is this:

For a while its been a policy here that on every clients first job, no work is handed over until full payment has been received. In 95% of cases its as mentioned in PJamie's post: all work is done, the client gets to see a full online demo then payment is requested.

Now this is where recently the client just disappears and doesn't pay up even though they have not got the work.

One could say that if they haven't got the work then there's not a lot that can be done but I personally view it that they are paying for the time and skills and the actual script is the end product of this. Even if they don't end up with the script and run off without getting it and without paying then in my view they are still liable because they haven't paid for the time.

What's everyone's opinion of this.... time or script?
I disagree, it dosen't matter here is how it is in my eyes. If you do the work ok, you did it, but if they didn't get it, they didn't get it, so the customer gets nutthing, but what does the developer get? Code.. Code... Code.... That they can use on other project's, or jobs that come along.

So basicly Jim if you were implying "fraud". It can't be fraud, untill one party hand's over the work, but the other dosen't hand over the green. Also in most case's it is considered slander (If you call it fraud, and label them "fraud"), and you can be sued, at least the rules of the usa.

Originally posted by Jim_UK
As standard with us, all jobs over £100 need a signed contract before work is started (to protect both parties). These non-payers have all been small jobs where there is no contract and around 70% have been to clients in the US. Short of asking for 100% payment up front (not the best way to attract jobs) I'm unsure of what approach to take.
[/B]

I would require payment up front. When we were doing a lot more design / coding work, our policy was anything under $600 would be do 100% upfront, and anything over $600 and under $1000 would be due 75% upfront, 25% upon completion. Anything over $1000 we generally asked for at least 35% upfront.

Originally posted by ChickenSteak

I disagree, it dosen't matter here is how it is in my eyes. If you do the work ok, you did it, but if they didn't get it, they didn't get it, so the customer gets nutthing, but what does the developer get? Code.. Code... Code.... That they can use on other project's, or jobs that come along.

So basicly Jim if you were implying "fraud". It can't be fraud, untill one party hand's over the work, but the other dosen't hand over the green. Also in most case's it is considered slander (If you call it fraud, and label them "fraud"), and you can be sued, at least the rules of the usa.

You would say that wouldn't you Brandon (http://www.webhostingtalk.com/search.php?s=&action=showresults&searchid=551745&sortby=lastpost&sortorder=descending)... how long before you get your username banned this time?

And don't even start on your "I'm going to sue you" spiel again.... you're the one who owes money here and I'm more than familiar with legal definitions to be scared off by some kid like you who likes to play businessman :rolleyes:

EDIT: Just found one of your old posts (http://www.webhostingtalk.com/showthread.php?s=&threadid=42781) Brandon by one of your several, now banned, usernames, it brought a smile to my face :)

Honestly I feel bad for you guys who get screwed out of your money, when you put in the hard work to do something for a client. Now let me also give you the other side.

I am speaking about me personally. I have no design skills whatsoever. I completely stink, and a 2 yr old can do a better design than me. Having said that, all of our company's designs have been designed by a proper designer. We are always skeptical of paying for the complete job upfront, because we don't think that the designer will work as hard to complete the job in a timely manner. We don't want to be stuck in the mud so to speak either, so usually 50/50 is the best way. Pay 50% upfront, then when the job is completed, the other 50%. But a note to all you designers and coders, DON'T hand over anything unless you have been paid, as this ensures that something like this doesn't happen.

-Steven

nutthing, but what does the developer get? Code.. Code... Code.... That they can use on other project's, or jobs that come along.

So basicly Jim if you were implying "fraud". It can't be fraud, untill one party hand's over the work, but the other dosen't hand over the green. Also in most case's it is considered slander (If you call it fraud, and label them "fraud"), and you can be sued, at least the rules of the usa.


Agree with Jim_UK on this. If you place an order for goods or services and the other person provides them then, if you don't pay you are commiting fraud. Doesn't matter if they don't actually deliver them because you hadn't handed over "the green". They did they work and they have every right to pursue you for this payment.

As for getting clients to pay up front I think that this is unrealistic in a lot of cases. After all, who says that you are actually going to do the work that they have paid for (put yourself in the clients shoes). You may know that you have every intention of completing the work, but the client doesn't.

If it's a relatively small piece of work (e.g. £300) then you don't lose much - only a few hours of your time. If its greater, then stage the payments on completion of targets.

It's a risk, all business is, but just pursue crooks and people who waste time - no matter how little - and you'll get satisfaction from messing with their credit rating.

I've pursued people for the £15 for a domain name (I could easily write this tiny amount off but I refuse to). Total eventual cost to them - over £200. They paid, and their credit scoring shows this judgement against them. It took a single call to our solicitor, and an hour of paperwork to pursue this.

It sounds vindictive (and it is) but don't get messed around. People soon find out and don't even attempt to.

As for the quote

but what does the developer get? Code.. Code... Code....

That is nonsense. If the job is custom then it's unlikely that you could use this code elsewhere. If I want a repository of code that I can't use then I'll do that in my own time, not while I am spending my hourly-billing time wasting it on crooks.

If what Jim_UK says is true, then this person is a crook and a fraud.

Do not provide the service without payment. It is that simple. If you are designing a web site, require a percentage up front, more during the process, and final payment prior to activation of the site. Yes, you will lose some potential business through a professional stance such as this. But, you will find yourself getting paid for the work you do.

If you did the work, whether they collect the rewards of the contract or not they're still bound to pay. They broke the contract and you are entitled to receive compensation.

Some very good points in this thread, especially the one by PJamie about pursuing any amount of owed funds. Certainly something to think about for anyone in the situation of being ripped off.

// note to self: phone lawyer in the morning :)

Hey Jim & Others,

Just wondering what scripts you developed (if they don't but them maybe someone else can)?

Jim - Your server status script gets a 11/10 from me :)

I paid a design firm $2000 plus to do a site once, and nothing was ever produced.

For you guys who won't work without money upfront, I hope you're trustworthy.

Bringing this thread up again, I'm still out of pocket. The company is UKtophost AKA Cottage Companies. I developed a bespoke domain registration script integrating with Worldpay. Payment was requested end of July, the guy has just pissed me about for months.

I wish there was really something I could do.