Breach of Contract: Freelancer Remedies
“We had previously agreed on a call for three content pieces a month. They started demanding eight content pieces a month while delaying the invoice," says Sakshi Jha, a freelance writer.
The biggest mistake in this case is not having a freelance agreement with the client. That's why having a clear, solid freelance contract is essential for any project.
However, even with a signed contract, freelancers frequently encounter hurdles like a changed scope of work and delayed payments. So, what should you do in such cases? Let’s find out the remedies for breach of contract.
Understanding Contract Breaches in Freelancing
A contract breach in freelancing occurs when either party fails to uphold their end of the agreed-upon terms. It violates the mutual understanding and commitments laid out in the contract. Let's break down what this entails:
- Failure to Fulfill Obligations: A freelance contract must lay down specific client obligations related to payment terms, defined scope of work, use of freelancer’s work and intellectual property rights, and providing necessary resources to perform the work. Failure to fulfill such obligations results in the breach of contract.
For example, a failure to fulfill obligations by a client could be not providing essential background information and content guidelines to the freelancer, despite repeated requests.
- Non-Payment or Late Payment: This is every freelancer's nightmare. Beyond contract breach, not receiving timely payment can significantly impact a freelancer’s cash flow, particularly when dealing with larger amounts.
- Quality Disputes: A freelancer contract must include certain quality benchmarks for deliverables. If the client suggests frequent revisions beyond the quality benchmarks, it can be considered a breach of contract.
- Failure to Meet Deadlines: Freelance assignments are subject to due date(s). Failure to meet timelines reflects poorly and constitutes a breach of contract.
While late payments, non-payments, and multiple revisions are common, there are other significant breaches worth noting:
- Copyright Infringement: Clients might misuse or reproduce a freelancer's work without proper authorization or attribution, violating copyright laws and contractual agreements. For example, a client might use a freelance photographer's images in promotional materials without permission or proper attribution.
- Sudden Termination of Contract: Clients may abruptly terminate a contract without valid reasons or adequate notice, leaving freelancers without compensation for completed work.
Understanding these less-talked-about breaches empowers freelancers to protect their rights and negotiate fair contract terms.
Remedies for Contract Breaches
Contract breaches are not uncommon. Fortunately, remedies are readily available to address instances of contract breach. By understanding these remedies and taking appropriate action, freelancers can confidently navigate contractual disputes.
Communicate Politely but Assertively
One of the best remedies for breach of contract is initiating a dialogue with the client over email or video meetings to find a mutually acceptable solution before taking legal recourse. Discuss the issue, clarify misunderstandings, and renegotiate terms to resolve the breach of contract amicably.
Here are some tried-and-tested tricks to communicate assertively yet politely:
- Be Clear and Concise: Clearly articulate your points about how the client has not fulfilled their obligations and the issues you faced because of the failure to uphold contract terms.
- Document Everything: Try to communicate over email so that you have a written record of the entire discussion. Even if discussions happen over the phone or in person, always follow up with an email summarizing key points and decisions. It creates a written record for future reference.
- Assertive, Not Aggressive: Be assertive in expressing your needs and expectations while remaining professional and courteous. For example, Instead of accusing a client of causing delays, say, "I'm concerned about the impact of these changes on our timeline. Can we discuss how to adjust our schedule?".
- Offer Solutions, Not Just Problems: "This isn't working" is not solution-oriented. Propose specific changes like, "What if we try a different approach for this section?". Brainstorm potential solutions before discussing the issue with the client to show initiative and preparedness.
Send a Reminder of the Freelance Contract Terms
In case of a breach of the terms, it is advisable to first send a reminder.
1. Contract Terms
Clearly outline the specific clauses of the contract that the client has failed to uphold. For example, your freelance agreement mentions that the client will make the payment within 15 days of the invoice, and delayed payments will be subject to a penalty of 2% per month. Highlight this clause in the email by mentioning the accurate clause number.
2. Client Relationship
Many professional problems are actually emotional problems. Stress the importance of the client relationship and express a genuine desire to continue working together. If you acknowledge the client's value and emphasize the mutual benefit of a successful partnership, a positive tone may heal egos and resolve disagreements amicably.
3. Customized Solutions
Offer solutions based on past track records. For example, when addressing issues like late or non-payment, consider offering flexible payment options or discussing the possibility of imposing late fees on a case-to-case basis. Some clients may be given tailored solutions based on specific circumstances.
Draft Demand Letter for Payment
When all attempts to resolve a payment-related issue with a client have been unsuccessful after the initial steps, it may be necessary to escalate the matter by drafting a formal demand letter for payment. This letter serves as a formal notification to the client regarding their outstanding payment obligations and emphasizes the seriousness of the situation.
Discontinue Services
In cases where the breach is significant and irreparable, a freelancer may choose to terminate the contract. The decision protects their rights and ensures they aren't taken advantage of.
For example, A freelance photographer enters a contract to capture images for a client's advertising campaign. However, midway through the project, the client repeatedly alters the scope. Recognizing the irreparable breach of contract, the photographer issues a formal notice of termination. Terminating the contract allows the photographer to safeguard his time and resources while seeking alternative opportunities.
Clear communication about the decision and its reasons is crucial. Discontinuing services asserts boundaries and signals professionalism, safeguarding the freelancer's reputation and future engagements.
Communicate Your Intention of Taking Legal Action
Before proceeding with legal action, it's prudent to communicate your intention to do so. This preemptive step can sometimes resolve disputes without formal litigation. Consult the freelancing community and experienced peers who've encountered similar situations before taking such a step.
Communicating your intention to take legal action should be done with careful consideration and professionalism. Here's a suggested approach, along with some tips:
- Choose the Right Medium: An email is a common and effective way to communicate your intention to take legal action. It provides a written record of your communication and allows the recipient time to digest the information before responding.
- Subject Line: Make the subject line clear and concise. For example, "Notice of Intent to Pursue Legal Action - [Project/Contract Name]".
- Opening Paragraph: Begin with a polite but firm statement of your intention. For example: "Dear [Recipient], I am writing to inform you of my intention to pursue legal action regarding [briefly outline the issue or breach of contract]. Despite our previous attempts to resolve this matter amicably, [state the reason for escalating the issue]."
- Provide Details: In the body of the email, provide a clear and detailed explanation of the reasons for your decision to pursue legal action. Include relevant dates, agreements, and any attempts made to resolve the issue. Use factual language and avoid emotional or accusatory language.
- State Expectations: Clearly outline what you expect from the recipient in response to your notice. This could include a request to resolve the issue through negotiation or mediation or to provide a response within a specified timeframe.
- Offer Opportunity for Resolution: Despite your intention to pursue legal action, express openness to resolving the issue outside of court if the other party is willing to cooperate. For example: "I remain open to resolving this matter amicably and would welcome any constructive proposals for resolution. Please feel free to contact me to discuss further."
- Closing: End the email with a professional and courteous closing. For example: "Thank you for your attention to this matter. I look forward to your prompt response. Sincerely, [Your Name]"
- Keep a Copy: Save a copy of the email and any responses received for your records.
Lawyer Up
Although an extra expense, legal action may be necessary in cases of severe breaches. Assess the severity of the breach and consider seeking legal recourse if necessary. In some instances, freelancers have successfully pursued legal action to address contract breaches.
There are many examples of freelancers winning legal battles. These victories often occur when breaches result in substantial financial losses or damages. Compensation sought may include reimbursement for incurred expenses, lost profits, or other monetary damages resulting from the breach.
Legal action is a last resort after exhausting other remedies and attempting to resolve the dispute through negotiation or alternative means.
Parting Words
It is important to draft well-written contracts that clearly outline expectations and protections for both parties. By being more aware of their rights and proactively safeguarding their interests, freelancers can mitigate the risks associated with contract breaches and foster a more equitable working environment.
Moreover, there's a growing availability of forums, online communities, and professional advice tailored to freelancers. These resources offer invaluable guidance on navigating contract disputes, advocating for fair treatment, and understanding legal rights.
At Skydo, we understand the challenges freelancers face, especially when receiving international payments. Trust us to be your reliable partner in navigating the complexities of cross-border transactions.
Q1. What are some of the early signs of contract breach?
Ans: Early signs of contract breach include missed deadlines, unnecessary delays, lack of communication, and failure to adhere to agreed-upon terms.
Q2. How do you draft an effective freelance contract?
Q3. When should I consider legal help during breach of contract?
