Protect Yourself While Freelancing: Legal Issues to ConsiderBy Angelica Malin
So you decide you want to freelance at this stage in your career. That is excellent news! Whether you make this decision due to circumstances or by choice, freelancing is exceptionally empowering and fulfilling. Self-employment is a great option which gives you a lot of freedom to choose your work, timings, and even make as much (or little) money as you want!
However, freelancers can be at a loss when it comes to legislation. You must have all the information that you need- before you learn them the hard way.
If you are currently freelancing or thinking about breaking off from your traditional job and going into a freelance career, it’s a great move! However, here are some things you need to know about protecting yourself while freelancing:
Knowing about contracts
One of the most common situations that you might face as a freelancer is dealing with contracts (or the lack of them). Most of the time, there is no official contract. However, this does not mean that you have no legal rights over the work that you create with your specific clients.
As long as there is an agreement of exchange of money for goods or services, there is an enforceable contract. Keep in mind that even if this contract does not exist on an ‘official’ or ‘legal’ document, it isn’t invisible. If you have an email or a message regarding this, it is a contract.
An important thing to keep in mind is that if you are making this agreement over the phone, it is a good habit to send a follow-up email with your client. You should mention the goods or services you are providing, as well as the payment information. This would be your written contract. In case the client does any suspicious behavior or refuses to acknowledge this transaction, you will have the email as proof.
A significant disadvantage of opting for a freelance career over a traditional one can be the lack of periodic cash flow. While some freelancers don’t mind this so much, it can turn out to be challenging for others to deal with.
When you are dealing with larger projects regularly, it can be an excellent habit to take deposits from your clients. For large projects, you can take a 50% deposit, while for smaller ones, you can opt for a 30% deposit.
You can communicate with your clients about how you would start the project only once the deposit clears. There are a few benefits of taking a deposit from clients, which are:
It allows the cash flow to keep coming in at more regular intervals
It allows you a vet a client
It allows you to engage in better financial planning
Structure of your employment
When you begin your career as a freelancer, the freedom that comes with it can be exhilarating. However, it can also be scary, as you might not know where or how to begin.
The most important thing to keep in mind is to take baby steps and see where you go from there.
You have to decide if you want to be a sole trader or a limited company. Of course, the industry that you are freelancing in may dictate this for you, but you still have a choice. You can opt to begin as a sole trader. Once you have a better footing, you can incorporate it.
Become part of a casual unionization
Labor unions are quite common, and you can see them in almost every industry. However, when it comes to freelancing, there is no such concept. This might be because the law recognizes a freelancer as a business and not a worker.
As a new freelancer, this can open up vast uncertainties and anxieties. The entire ambiguity of the freelance market can be quite scary, and many freelancers quit because of this reason.
It can work out advantageous at this stage to enter into casual unionization. This refers to a network and collective of freelancers working in your industry or similar industries. By entering into this sort of system, you can get the assistance and guidance which you might find at a labor union.
It can be challenging to figure out what your industry standard prices are, how you should price your services, how and where to approach clients, and how to protect yourself. However, by entering into casual unionization, you will realize that a little help goes a long way.
Within this network of freelancers, you should discuss contracts, pricing structures, clients, and rates openly. You will open up a treasure trove with this valuable information from these networks.
Keep in mind that many freelancers often subcontract extra work. This especially can help you find that extra income or the push that you need to find a job in the market if you are lacking.
As a freelancer, it is in your hands to get your audiences to notice you. Likely, you don’t have a big name for yourself yet, and clients are not coming out and reaching you.
You will have to create a website where you market your business. Provide accurate information regarding what you are offering and even your pricing structure. However, make sure that your website complies with the minimum rules in regards to those with disabilities.
This means that you should provide a text-only version that text converters will be able to access. You should also remember to establish specific privacy policies. This not only lets the users know where they stand, but they also limit your liability.
Typically, your sector will be a substantial dictating factor in the legal and compliance issues which you will have to take care of. The market can be an overwhelming and intimidating place for freelancers if they are not aware of their legal rights and liabilities. It is essential to read up and even take professional help regarding legislative matters. This can help you navigate your freelance market much more professionally and confidently