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Crisis and payment
Thread poster: MariusV

MariusV  Identity Verified
Lithuania
Local time: 00:09
English to Lithuanian
+ ...
Jan 9, 2009

Hi folks,

I have the following situation which got me quite upset:

Recently I have been doing a large project in several parts. Out of 4 parts, we have done 2 parts. With the agency (the translation goes for the "end client", i.e. the client of the agency) we agreed that the invoice will be issued after completion of the project.

Several minutes ago I received an email from the person in charge of the agency who informed me that the client refused the continuation of the project (all was OK with the translation, the end client simply decided to cancel). AND the following email about the invoices and payment:

Hi Marius,

I need an invoice from you folr the parts you have done.
Unfortunately, my client decided to cancel the remaining parts of the project and haven't paid me too -- yes, the crisis got the
upper-level client and so the result...
I offer you to pay 50% of your amount now [from the due amount] and the rest after my
invoice will be paid (someday).
I think, it would be fair for us both.

Well, do you think it is fair, having in mind that:

a) my time was prebooked and scheduled (did not take other projects for two weeks), we had clear agreements for deadlines, and payment terms;
b) they have received a really reasonable rate, I did even more that I needed to do (helped them with many related things, did many small extra files for free, etc.);
c) I had a deal with the agency, meaning whatever they deal with their end client, this is their business, and I am only interested in what I deal with the agency, plus the amount is not that huge as not to be able to have it from the "reserves" of the agency in full.

On the other hand, it is good that the agency, at least, informs in advance about the real situation and I do not need to "chase" them asking "How about the remaining parts of the project which were scheduled to start some days ago?", or "Hello, your payment is overdue and I need to know the situation"...

Do you think it is fair from the side of the agency to behave like that and how should I bahave myself (let alone that I had losses for the cancellation). Also - shall I take other projects from that agency (from other "end clients")? From one hand, I want to refuse working for them till they settle for this project in full, but on the other hand, I appreciate their straightforward approach (better to tell some unpleasant things in advance that to hide them when the time comes to settle them)...To be fair, I have rather mixed feelings about all that.


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Martha Schwan  Identity Verified
Brazil
Local time: 19:09
English to Portuguese
+ ...
HELLO Jan 9, 2009

January 9th, 2009.

For me this is not fair at all. When someone contact us to do a job, they have to pay. Another thing that I do not think is safe at all, is doing a job for some agencies, deliver the job, and then wait 30, 45 or even 60 days to receive a payment and even after that, nothing garantees that we are actually receiving the money.

I have recently finished a job for an agency, had to wait 45 days for the payment. The day finally came and I did not get even half of the money!!

I've sent tons of e-mails and reminders and the person in charge did not even reply.

Nothing at all!!

I am facing a big problem, because I do not like to deliver a job before receiving my payment.


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Martha Schwan  Identity Verified
Brazil
Local time: 19:09
English to Portuguese
+ ...
Hi Jan 9, 2009

And besides all that the agency surely got some payment from the client.

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Amy Duncan  Identity Verified
Brazil
Local time: 19:09
Portuguese to English
+ ...
Stick to your guns Jan 9, 2009

Hi Marius,
Even though the agency was "up front" with you about the situation, your payment has nothing to do with their problem. By having a business, they are obliged to pay the people who work for them, no matter where that money comes from. As you pointed out, not only was the job unexpectedly cut off, but you may have turned down other jobs because you expected to finish that one and needed the time to do so.

There's the old saying, "you can't get blood out of a stone," and you may not get paid if the agency doesn't have any money (or says they don't), but you can certainly stick to your guns and try to get them to do the right thing.


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Roman Bulkiewicz  Identity Verified
Ukraine
Local time: 00:09
Member (2004)
English to Ukrainian
+ ...
One troubling thing here... Jan 9, 2009

...is the "someday":

MariusV wrote:
and the rest after my invoice will be paid (someday).


At the very least, and quite firmly, I would insist on replacing the "someday" with "but no later than" -- and a fixed term or date. As generous for your client as you want -- but fixed.
Otherwise it is neither fair nor business-like at all (excluding some really desperate situation like bancruptcy, which I understand is not the case).


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xxxLia Fail  Identity Verified
Spain
Local time: 23:09
Spanish to English
+ ...
their estimate of risk isn't yours Jan 10, 2009

Did you get a PO and did you include terms referring to cancellation? It's essential for big jobs requiring big commitments of time that lead you to refuse other work.

If you didn't, the situation is not clear, but morally the agent should pay you waht you did 100% within 30 days. You negotiated your "risk" with them, they did so with the end client, and it's not fair that you should assume the risks that they assumed.

But without a PO ...?

Your "reasonable" rate, your "extras" are totally irrelevant.

Agencies have different ways of offloading their own problems on the weakest element in the chain (the translator), some ignore emails, others try to preempt them and "try it on", others try to be honest and fair while covering their backs .... Don't be fooled, just try to make a balanced judgement based on their past record with you. Your judgement may be wrong, but if teh s*** really hits the fan at their end, don't be surprised if they fail to appreciate your work plus extras.

If you have a PO, you are in a very strong position to simply state that you insist on payment in accordance with its terms. If not, you can do the same, although your position is much weaker.



[Edited at 2009-01-10 00:53 GMT]


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MariusV  Identity Verified
Lithuania
Local time: 00:09
English to Lithuanian
+ ...
TOPIC STARTER
well, some ideas Jan 10, 2009

Thanks, folks, for the advise. I just summarized everything - to prepare the guns, but still to try peaceful negotiations as far as it is possible...

a) no need to panick yet (despite such a situation and such an approach of the agency really upsets and generates a lot of negative emotions) - I have their PO, I have email correspondence and I do have their end client contacts; if the agency is "cooking" something, i.e. the client paid to them, but the agency itself has some "crisis problems", I can always ask their client about the real situation (and yes, I then do have the right to contact the end client, as the agency "implies" a "trilateral" relationship;

b) I'd really ask them to pay those fifty per cent right away, and will give them, say, three more weeks for the remaining amount - I think I'd also demand from them a doc like an overdue bill with the signature of the agency stating that they are obligated to pay - in the worst case, I will have an undeniable doc if I need to go for money collection via legal measures...

c) let alone that I have a friend lawyer at the town of the agency, let alone that I can claim for copyright (as my translation was already published);

Now the main question - shall I trust this agency any more (during the time till they settle all debt)? In other words, shall I be rather tight from the very beginning, or shall I show some good will at first (that "good will" can be very good if things go up to legal money collection)...






[Edited at 2009-01-10 00:32 GMT]

[Edited at 2009-01-10 00:33 GMT]


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xxxLia Fail  Identity Verified
Spain
Local time: 23:09
Spanish to English
+ ...
be firm! Jan 10, 2009

MariusV wrote:



Now the main question - shall I trust this agency any more (during the time till they settle all debt)? In other words, shall I be rather tight from the very beginning, or shall I show some good will at first (that "good will" can be very good if things go up to legal money collection)...






[Edited at 2009-01-10 00:32 GMT]

[Edited at 2009-01-10 00:33 GMT]


See how they respond!
You may be worried becuase they are an important source of income. But if they are worth having as a client, they'll behave properly (otherwise, start looking for a replacement). Maybe give them one chance: spell out the terms and conditions regarding any outstanding payment before you accept the next job (you decide what you can risk)

When it comes to goodwill and money collection, it all comes down to your past rela
tionship/experience and how you see your future with/without them:-)

BY THE WAY! I just assimilated your post title "Crisis and payment". I think you could have chosen a less alarmist title - becuase how can you be SO SO sure you aren't being paid becuase of the "crisis"? The fact that you don't get paid becuase someone says that someone says that the job's folded because of "crisis" isn't AT ALL verifiable. That's just hearsay (or excuses). In the interest of balance - in this public site: the situation you descibe is one particular experience lived by one particular translator - and not a "crisis".

"Expectations" are an important aspect of economic performance - it is measured constantly - so it's important not to paint one's personal issue with a single agency in terms of "crisis", because using that word has all sorts of connotations for those whom I referred to earlier - the translators at the bottom of the food chain (people who are beginning to be squeezed by downward pressures in rates - precisely on the basis of arguments of "crisis" - and many businesses are abusing that argument). If the word "crisis" is bandied about so liberally, they are more likely to succumb. Your own "crisis" is actually a personal issue.

I STRONGLY SUGGEST you ask a moderator to correct your title to exclude the word "crisis"!


[Edited at 2009-01-10 01:33 GMT]


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Heinrich Pesch  Identity Verified
Finland
Local time: 00:09
Member (2003)
Finnish to German
+ ...
You should get paid for all work done so far Jan 10, 2009

Not only the parts you have delivered but also the parts of the unfinished translations should be acknowledged and paid in the future.
If you think this customer will be useful in the future you could accept his terms.
Regards
Heinrich


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Tim Drayton  Identity Verified
Cyprus
Local time: 00:09
Turkish to English
+ ...
A dose of realism Jan 10, 2009

These are hard times. The agency may indeed not have the funds to make this payment in full just now. They do not possess a magic wand which will enable them to conjure up non-existent funds. If all of the company's creditors were to adopt the hard line approach advised by certain posters above and, for example, initiate legal proceedings to recover their debt, this would probably drive the agency into bankruptcy and nobody would get a penny. On the other hand, if the agency continues to trade there is a fair chance that they will eventually be able to meet their obligations to creditors. Judging from their reply, it appears to me that they are acting in good faith, and it may be in your best interests to accept this offer. This is my own personal opinion as somebody who has no legal training whatsoever.

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Michele Johnson  Identity Verified
Germany
Local time: 23:09
German to English
+ ...
full payment for parts 1 & 2, compromise on parts 3 & 4 Jan 10, 2009

For parts 1 & 2: I would expect full payment immediately, or at the latest in accordance with the agreed on payment deadline in the original PO. I'd also accept 50% now and 50% in 30 days.

For parts 3 & 4: I would strive towards some kind of compromise. Obviously, they commissioned you for the full job, and it's annoying (and probably not even legally valid) that they canceled. Of course you have losses because of this. However, I could never in good conscience invoice an agency for work that I haven't done. And you would probably have to pursue this though legal channels, which may or may not be worth it in your country. I would push for some partial recompense / "fee" for parts 3 & 4, less than 100% and more than 0%, for canceling the job and to cover the losses you incurred. You turned down work for this period, but presumably you can at least partially make up for it now that you know that time period is available again. Perhaps 25% to 50% of what you would have been paid for parts 3 & 4? For me, it would depend on how important this customer is and the order of magnitude of money we are talking about.


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KSL Berlin  Identity Verified
Portugal
Local time: 22:09
Member (2003)
German to English
+ ...
Payment in full for the parts done Jan 10, 2009

If the agency is willing to pay part of the sum due now that is rather useful. However, as Roman pointed out, "someday" should be spe4cifically defined as 30 days or whatever terms you find acceptable. I would use the usual payment terms for this client (whatever they are) and accept the early payment of the partial sum as an apology for the inconvenience.

As far as billing remaining amounts that may be due for parts you have not translated, I personally would not bother. However, that is my choice which reflect the dynamics of my business and the fact that I can fill up any unexpected "gaps" very quickly. The situation in your language pair might be very different. However, even if you do have the legal leverage to insist on the full contracted amount , I would consider the impact on the long-term relationship with this client. If the terms of cancellation are defined on the PO or in another contract between you and the client, then things should be handled according to these terms, of course. Michelle's suggestions regarding a compromise seem reasonable if you are inclined to pursue it.

In any case, this may be a very useful lesson to you (and to others, including me), the lesson being that cancellation terms should be clearly agreed in advance in some way.

Even in the current situation, however, I agree with Lia that the word "crisis" really doesn't belong in the thread title, regardless of what was meant by it. Even if the current international financial problems were somehow tied into this incident, this particular matter is quite limited in scope and manageable.


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Emma Gledhill
Local time: 23:09
German to English
+ ...
I agree with Kevin Jan 19, 2009

That you should be paid for the work you have actually done is clear and not subject to dispute I think - certainly your client isn't disputing it. The issue here is whether or not you should be paid for the work that will not be done because it has been cancelled.

I'd like to ask you - would you ever agree to buy a service if you had no option to cancel, that you were liable for the full amount from the moment of order, even if you never received anything for it? Would you expect to pay full whack if you book an hour with a lawyer in one month's time but then have to cancel, giving reasonable notice? If you have to cancel a holiday before paying the balance, would you expect to have to stump up the balance anyway or just lose your deposit?

I think the key here is that you should have terms & conditions that set out your cancellation policy. For instance, you could state that you will charge 100% for work cancelled within 24 hours of the due delivery date & time with a sliding scale for greater notice. Or you could state that you will charge for time reserved if you are unable otherwise to fill it. You can work out what suits you best, but I don't think it's fair to insist on 100% payment for work you haven't done if you will be able to accept other work as a result.

Moreover, the agency seem to have been straight with you and you may well find, that if you are reasonable with them too, you will earn a load of goodwill from them, thereby ensuring that you are high on the list of people to call when they have another job, and/or that they may feel bad about the cancellation and try to send you other work to make up for it. Otherwise I fear you run the risk of getting a reputation for being "difficult"

ETA: oops, just read Kevin's post properly and my last two paras repeat what he said


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Mervyn Henderson  Identity Verified
Spain
Local time: 23:09
Member
Spanish to English
+ ...
Don't say the C word Jan 19, 2009

Hi Marius,

Just to say I agree with Lia and Kevin on the "crisis" title thang, although I assume you wrote that in the initial heat of the moment.

As far as I can see, neither your customer nor the end customer has pleaded crisis (nor should they), so the term "crisis", in the sense that it is only now considered critical when the Big Boys who have been drooling incompetently over our funds for so long now find themselves in need of institutional bail-outs so they don't go into receivership or find themselves compelled to dig into the Swiss account, is neither here nor there.

My advice is not to mention the word "crisis" to them under any circumstances in your correspondence, especially since it wasn't specified as an issue. They'd just love you to mention it.


Mervyn


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