he objective of this article is to improve communication between freelance translators and translation agencies on various payment issues.
It is based on my first-hand experience in freelance translation from English to Russian and vice-versa for 45 translation agencies in 12 countries (USA - 11, UK - 7, Russia - 5, Japan - 4, Belgium - 3, Czech Republic - 3, France - 3, Germany - 2, Hong Kong - 2, Israel - 1, Netherlands - 3, Sweden - 1) and 20 direct clients from four countries (Russia - 14, France - 1, Israel - 1, USA - 3) from July 1999 to July 2003, with an approximate total word count of 2 million source words.
Practically all freelance translators are familiar with the frustration of spending too much time and effort collecting fees for translation. The optimization of this process may therefore be of interest to many of my colleagues.
This problem can be approached in two ways:
1. Thoroughly check the client's payment practices BEFORE accepting a job
2. Professional debt collection AFTER the job has been completed and delivered to the client.
If the first step is implemented well enough, the second step will be unnecessary. See Fig.1.
Fig. 1 Let's focus on the first step.
When you are approached by a new agency, the first thing you need to do is check its payment practices on all current payment practice databases. I know of five of them: www.proz.com/blueboard, www.tcrlist.com, http://groups.yahoo.com/group/pp_dist, and the lists regularly e-mailed to subscribers by www.translationdirectory.com and www.topica.com/lists/transpayment/. The last three information sources are free. The first two charge a little bit, but the information is well worth it.
Then you should visit the agency's website and see if it provides all necessary contact info (full street address, phone, fax, e-fax, mobile, e-mail address) and a list of the agency's clients and client testimonials, preferably with contact info. If the agency has no website, this is a bad sign (for example, the notoriously non-paying Polylingua from the Czech Republic). Another bad sign is a free e-mail address.
Pay attention to the agency's memberships in professional associations, such as ATA for USA agencies and ITI for UK agencies. An agency should be registered with its national chamber of commerce and have a registration number.
You can ask the potential client to provide you with this information if it is not published on its website. A client with good intentions and a first-class reputation will be happy to cooperate. I recommend asking for this information immediately after receiving a P.O. or contract. Some other important pieces of information to be collected include: How long has the client been in business? How long have they been at their current location? Who owns the business?
If the agency has positive payment practice records in the above databases and willingly provides the information you need, you can accept the job without worry. Most probably you will have no problems with collection.
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Now let's focus on the second part of your task—professional debt collection from problem clients. It is most important to learn to differentiate between "non-malicious" and "malicious" delays of payment. The typical reasons for "non-malicious" delay are usually as follows:
1. Poor organization at the translation agency. Usually one person is responsible for placing translation assignments, another for approving payments, and a third for executing payments via a bank. In most cases you will never contact persons #2 and #3, but they are key figures in the payment process. It often turns out, as the Russian saying goes, that "the right hand does not know what the left is doing."
2. Poor communication: You send a reminder to your translation manager. He forwards your reminder to the accountant. You receive no response from either one (the translation manager thinks payment is not his area of responsibility; the accountant never communicates with freelance translators because this is the translation manager's responsibility). Poor communication undermines trust and robs time from both parties. In fact, poor communication is a result of poor organization.
3. Mistakes in the bank application for a wire transfer. For example, several of my direct clients and some of the agencies I've worked with have been confused by such terms as "correspondent bank" and "beneficiary's bank," and sent the funds to the wrong bank. This resulted in time lost for both parties and delay in payment.
In my four years' practice, non-malicious delays for periods exceeding one month were caused by five agencies; mistakes in banking details accounted for five further cases; receipt of a smaller amount than promised without explanation occurred in only one case (World Link Technologies, USA).
Do not mistake poor communication and organization and banking mistakes for an attempt at non-payment. Never be too harsh on non-malicious non-payers. They are probably working as well as they can and a harsh tone will not help the situation. In fact, you may offend someone and lose a good client. Late payment is better than no job at all. If you cannot differentiate between non-malicious late payers and malicious non-payers, you could lose a valuable client by being too harsh during the collection process. The trick is to collect the debt in such a way that your professional relationship is not damaged, so you can remain partners for many years to come.
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"Malicious" delay means the agency is seeing if it can get away without paying you. The agency may be testing how far you are ready to go to collect the payment and how professional you are in debt collection. This situation is typical in uncivilized business environments such as Russia and Eastern Europe, but there are malicious non-payers among USA and UK agencies, as well. This is exactly how STB (UK) operates.
The key words here are "politeness" and "persistency." You should make the client understand that they have no chance of getting away with non-payment. I use the following practices:
1) after a 3 day delay of payment—a polite reminder by e-mail
2) 10 day delay—a polite reminder by fax
3) 20 days—a telephone call
4) 30 days—a fax/snail-mail with a polite promise of exposure on the worldwide translation scene and legal procedures.
Signs indicating an attempt at malicious non-payment include:
1. The agency does not respond to your repeated e-mail or fax reminders
2. The agency suddenly stops answering your phone calls
3. The agency says the payment was made, but does not provide banking confirmation of the fund transfer when you request it (this is a standard banking document containing fund transfer details, with a unique reference number. Depending on the country, it is called a SWIFT copy or an advice of funds transfer).
When you are sure you are facing a case of non-payment (usually confirmed by complaints of other translators published in some of the above-mentioned payment practice databases), you should send a politely worded list of further actions you will take for collection. This list is a very effective collection tool, but you should use it only if you are 100% sure of the malicious nature of the problem. This is your ultimate weapon, so use it discreetly.
This list of collection actions can include very polite assurances (not threats!) to expose the non-payer before:
1. its clients
2. its national chamber of commerce
3. its national association of translators/translation agencies
4. the ITI or ATA
5. The five payment practice databases.
You should also assure them you will file a lawsuit through a local lawyer, hire a local debt collection agency, and contact the local chapter of the Better Business Bureau, if the problem occurs in the USA.
If the agency does not react, start to implement your exposure plan—one action a week, with notifications sent to the debtor.
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My statistics after four years of active freelance translation are as follows. Among 45 translation agencies in 12 countries, and 20 direct clients from 4 countries, I met only one malicious (and notorious) non-payer—Polylingua (Prague, Czech Republic), which is managed by Marta Cettlova. I accepted two small jobs from Polylingua during my second year of work without properly researching the agency. Only after completing the jobs and encountering a payment problem did I discover that the agency had been exposed by my colleagues on the aforementioned databases! Luckily, the lost amount totaled only 0.4% of the fees I earned during these years.
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Conclusions:
1. Concentrate your efforts on checking the reliability of a client (AFTER receipt of a contract or PO, but before doing the job), not on collection after problems begin.
2. When collecting your debts, be polite, flexible and persistent. To preserve your share of the market, do not call in the big guns unless absolutely necessary.
3. Poor communication and organization of the payment process are much more common problems in translation agencies than malicious attempts at non-payment.
