Online arbitration for freelancers is a great way for freelancers to protect their income by legally stating the terms and conditions for payment for services rendered.
The freelance working model can be very rewarding and can restore work-life balance for those who truly have a passion for their area of expertise.
What is not so rewarding is chasing up unpaid invoices or writing off bad debt.
All freelancers have been there at some point, whether they are writers, graphic designers or accountants. It’s a dry month and you don’t have as much work as you would like in the pipeline.
You start sending out email reminders to clients that have not paid you, even though they are overdue payment terms.
You know that the longer you let it go, the less likely they are to cough up what they owe you.
Why? Because you are a small concern to your clients and some (not all, far from it…) may take advantage of the fact that you have very little clout.
What are your options?
If your clients do not pay you, what can you actually do to get access to justice? There are some options, but they normally give a return of pennies to the dollar and could even end up costing you more than you are actually owed.
Debt collection agencies
The debt collection agency business model is aimed at making money off your debt. They call and chase debtors, but they will charge you money for a simple phone call, even if the debtor doesn’t answer.
Before you know it, you could end up owing these guys more than you are owed, so tread carefully.
You could send your clients a legal letter.
Aside from burning bridges and not getting their business again, you need to find a lawyer, pay the lawyer’s fee, send the letter in the registered post and wait for a reply.
You get it… it will cost you an arm and a leg and will probably get you nowhere far very quickly.
Sue them in the civil court
The next alternative is to file a civil lawsuit against your clients. But be warned… the Civil Court delays before Covid were already huge. Post-Covid, the Civil Courts backlog has grown to gigantic proportions with no end in sight.
If you do ever get to have your day in court, it is going to take years to get there.
Once the case does get to court, you will be paying in blood, sweat and tears as lawyers go on fishing expeditions and the defendants do not show up in court. What does that mean? Throwing away good money after bad.
But there is a legal process that favors you.
Include a freelance online arbitration clause in all your contracts
The courts recognise that they simply cannot keep up with the volume of cases that are filed on a daily basis.
As part of a strategy to bring that caseload down, more state courts are advocating the use of arbitration.
In fact, arbitration is becoming more common and is endorsed by the vast majority of state legal departments.
As an example, the US Department Of Transportation stipulates that by Federal Law, every moving company must be signed up to an arbitration program if they are involved in interstate shipments of household goods.
The DOT instituted this law (49 CFR 375.211) to reduce pressure on the US civil court system.
We expect more governmental departments and private companies to demand online dispute resolution solutions in the post-Covid world.
Online arbitration for freelancers – What is an arbitration clause and how can it help me?
Online arbitration is a form of online dispute resolution and alternative dispute resolution. Online arbitration for freelancers is a viable option because it is much cheaper and quicker than all other options.
A total of nearly 10,000 arbitration cases were filed in the US in 2020, with $18,011,977,599 in claims arbitrated.
Binding arbitration depends on a solid contract that is relevant and fit for purpose. This means that the solution must fit the contract itself. Many contracts call for expensive, in-person arbitration, which is overkill for most monetary claims.
Put simply, when entering a contract, an arbitration clause will stipulate that in case of default or disagreement, an arbitration platform that you both agree on can be used to trigger a process that is legally binding.
If both parties agree to arbitrate in the contract itself, then the pathway to resolution can be made simple, fast and effective.
What makes Brief a market leader in the field is that its process is 100 percent online.
Filing an arbitration claim with Brief is easy and covers all types of disputes. The average time to turn around an arbitration claim with Brief is 45 days.
In addition, you pay an upfront fee which is dependent on case complexity and should cost you an average of $1,700 or less.
You can check out Brief’s arbitration sample clause and clause builder.
The Brief six-step process involves opening a claim, to which the defendant will be notified.
They will be given the opportunity to respond to the claim, but if they don’t the assigned Ejudge will decide that they have defaulted and an arbitration award will be issued, which can be filed in the local court and reduced to an enforceable judgment.
Once both parties submit their evidence, the Ejudge will proceed to evaluate the evidence and will also handle the Discovery phase, eliminating “fishing expeditions” that can take place in both civil lawsuits as well as traditional arbitration.
Should you prevail, the Ejudge will issue an Award in your favor.
Brief’s main focus is on bringing the debtor to the table. This is why we also offer them the ability to settle the claim.
As the plaintiff, your business will be given the opportunity to set out a settlement sum, which is presented to the defendant.
If they do not find the offer acceptable, they are invited to make a counteroffer which you can accept or dismiss in favor of the arbitration process running its natural course.
Are you ready to recover what you are owed with online arbitration for freelancers?
Brief has helped small and large businesses across the United States recover debts that were simply not worth the cost of traditional litigation or arbitration if not for online dispute resolution.
Register now on our online portal. If a dispute arises, it is a simple process to submit your claim, all for a flat upfront fee.
Brief’s online arbitration platform is typically 80 percent faster (or more) than a civil court hearing or traditional “brick and mortar” arbitration.
Satisfied and repeat participants include electronic commerce sites (Fintech), factors, banks, MCAs, and other lenders.
Brief also handles all types of monetary disputes as well as declaratory relief actions such as quiet title, coverage claims and warranty claims.
Our screened network of “Ejudges” spreads across all 50 states and each case is matched to the jurisdiction and subject matter expertise of the Ejudge.
You can request a demo from our homepage or call one of our arbitration consultants today on tel: +12134443794. Alternatively, drop us an email at [email protected] to book an obligation-free consultation.
Brief is a market-leading online arbitration platform in the United States. Our 100 percent online alternative dispute resolution platform helps businesses protect their contracts and agreements through online arbitration. Follow us on LinkedIn or Facebook for updates and news about online arbitration and more.
*Brief cannot and will not give legal advice on any matters, financial or not.