Self-billing

a note to NUJ freelance members

(1) Introduction.

Self-billing (also sometimes referred to as self-invoicing) is a method employed by a number of media organisations to process payments to freelance contributors.

When self-billing procedures apply, the publisher works out how much is owed to each contributor, instead of the freelance sending his or her own invoice. In most, though not all, of these cases the publication will insist on use of self-billing, and will not accept invoices sent in by contributors.

The practice now appears to be applied in one way or another by a wide variety of UK media organisations including The Guardian, The Times, Sunday Times, Scotsman Publications, The Herald, Sunday Telegraph, Mail on Sunday and The Daily Mail. Both print journalists and photographers are affected.

(2) Issues raised by self-billing procedures.

Many freelances are unhappy with the way self-billing works. Since procedures differ between organisations and between different commissioning editors in the same organisation, it is difficult to generalise. However, some of the concerns commonly raised are as follows :

  • Self-billing weakens freelances' control over the terms on which they carry out work, and places too much power in the hands of publishers;

  • Freelances never know in advance how much they are going to be paid, and publishers can use the procedure to decide at their own discretion how much they are going to pay for work submitted; ? Publishers sometimes use the self-billing procedure as a means of reducing amounts payable to freelances – for example when budgets are reduced;

  • Self-billing can be used as a means to delay payment, since payment will not be made until the publisher issues an invoice;

  • Self-billing can cause problems for freelances who are registered for VAT, particularly when issue of invoices is delayed;

  • Self-billing procedures may also cause difficulties for freelances who wish to claim expenses;

  • Publishers sometimes include wording in their self-billing documentation that takes more rights in work commissioned than freelance contributors had agreed or intended to assign;

  • When freelance contributors agree a higher fee than the standard or minimum rate with commissioning editors, this is often overlooked or ignored by accounts departments when they issue self-billing invoices. In these cases, the invoices are frequently issued for the standard or minimum rate;

  • Work commissioned from a freelance is sometimes published in one form – eg. on a publication's website - and the freelance concerned is later asked to revise the material for publication in a different form – eg. in the print version of the newspaper or magazine involved. When self-billing procedures are used, the amount paid often reflects the journalist's work on the original version only, and provides no additional sum for the revision work.

On the other hand, some freelances find the self-billing procedure convenient, and some say that in a number of circumstances it ensures that they receive payments that they might not have claimed themselves.

For example, when a news piece is submitted to several publications or a photo is used several times in different contexts, the freelance may find it difficult to trace all the occasions on which his or her work has been published. If, in these circumstances, the publication applies an automatic self-billing procedure, the freelance concerned may then receive payments that he or she might not have billed for him/her self.

(3) Self-billing – basic situation.

Self-billing is an administrative procedure aimed at streamlining the payment process. It is not the mechanism whereby payment rates, date of payment, and the other conditions applicable to freelance commissions are determined. These are set by express or implied agreement when the work is commissioned, and the position in this respect is essentially the same both where self-billing applies and in cases where the contributor sends in an invoice.

What self-billing can do is to make it that bit easier in practice for publishers to try to get away with imposing miminum terms on contributors if these have not been clearly established when the work is commissioned. A freelance may, for instance, hesitate to be too insistent on getting all the terms and conditions clearly spelled out at the beginning for fear of losing commissions. If the contributor is later dissatisfied with, say, the amount of payment received, or the time taken to send out the payment, the freelance concerned may then ascribe his or her disappointment to the self-billing procedure.

In other cases, a freelance may be concentrating on generating income by sending off as many pieces of work as possible, and not wish to interrupt the flow by painstakingly spelling out the terms on which the work is submitted. Also, the way in which work is commissioned may vary considerably from one case to another. In some instances there may be a formal commissioning letter, but often there will not. For example, work may be commissioned by phone, and informal procedures are likely to apply where a freelance contributes regularly to a publication.

Freelances do not have to be trapped by the self-billing procedure. They can help themselves to avoid this by ensuring with the organisations for which they work that the terms and conditions on which they are working are clear when work is commissioned from them. (Important points under this heading include rates of pay, copyright questions, and when payment will be made.) They also need to keep a close eye on outstanding payments and follow up quickly if these are not made in time or the correct amount is not paid. The following section sets out some specific suggestions in this regard.

(4) Some practical steps.

As mentioned above, the precise ways in which self-billing operates will differ from case-to-case. The following pointers are for general guidance.

  1. In some cases, media organisations that normally use self-billing procedures may be willing to accept invoices from contributors as an alternative in some situations. For instance, the Guardian says that it will accept invoices from freelances who are subject to VAT. However, the freelance has to take the initiative of requesting this, otherwise self-billing will apply automatically. If you are concerned about self-billing, it is always worth asking if you can send in an invoice instead.

  2. If the organisation for which you are working publishes standard terms for freelance contributions (rates of pay, rights in work commissioned, timing of payment and so on), read these carefully, and make sure that you have a copy of the current version. (For instance, conditions set out on publishers' websites may sometimes be out of date.) Points to check include whether or not it is clear that work commissioned and submitted will be paid for even if not published, and whether the organisation is trying to take copyright in your work.

  3. If you manage to negotiate different (and presumably better) terms than the standard ones, it is important that this agreement should be recorded in written form. At the very least, you will need to send an email to the relevant commissioning editor setting out clearly what you have agreed with him or her. You will need this as evidence if the terms are subsequently not respected. (For example, the commissioning editor fails to inform accounts, and accounts sends you a self-billing invoice showing the standard rate of pay instead of the higher rate that you had succeeded in obtaining.)

  4. If work is commisioned from you by a commissioning editor that you have never worked with before, make sure at the outset that he/she is fully aware of the terms on which you work for the publication concerned and that he/she accepts them. Send him/her written confirmation (eg. email) of these terms, and keep a copy of your confirmation.

  5. Where applicable, check in advance what you need to do to claim expenses in cases where self-billing applies. And send your expenses claim in promptly, otherwise the accounts deaprtment may issue its own invoice without any expenses being included.

  6. If a media organisation for which you have worked fails to issue its self-billing invoice and to pay, it is in breach of its contract with you. Accordingly, you can put in a claim for the amount due to you even though no invoice has been issued. Late payment is also a breach of the contract terms, and a client cannot avoid responsibility for late payment simply by being dilatory about issuing its self-billing documentation.

    These points underly the importance of being clear about the rate of pay and date or period for payment when the work is commissioned. If there is uncertainty in either of these respects, it will be more difficult for you to claim the amount due and/or to claim that payment is late.

  7. Characteristically, the accounts departments of publications that practice self-billing say that they apply standard rates and conditions to work commissioned unless the commissioning editor indicates to them otherwise. They also say that they are open to rectifying matters afterwards if the journalist complains that he/she has not been paid the correct amount, and this can be verified. Accordingly, it is important to check all payments received carefully, and to take the matter up straight away with the publication concerned if payments are not correct. Phone conversations in this respect should also be promptly confirmed by email or other written form.

5) Conclusion.

Self-billing procedures give rise to some specific issues as outlined above. At the same time, the most serious matters of substance raised by freelances in this context are often concerns about a more general degradation of the terms of freelance work rather than about the specific payment procedure adopted. Reduction of rates of pay, rights grabs, late payment and so on are general problems that apply to freelances regardless of whether self-billing or traditional invoicing applies. These are all matters on which the NUJ continues to campaign.

Last modified: 20 Oct 2006 - © 2006 contributors
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