As the gig economy continues to expand at breakneck speed, more and more workers are shunning traditional employment paradigms in favour of becoming a full-time freelancer. After all, the freelancer can choose their own hours, be their own boss, and even travel the world as they work. But that’s not too say it’s all smooth sailing.
Flying solo without the support of an established employer means there are several factors the freelancer must handle on their own, not least of which are the legalities of their trade. Here are 5 essential legal tips every Australian freelancer must know.
Get It in Writing
For smaller gigs for loyal, long-term clients, it’s quite common and reasonable to undertake a job based on a loose verbal agreement – which is hardly surprising, considering the time and effort that goes into writing up a contract.
But regardless of how well you know and trust the client, a project worth a considerable sum should always be accompanied by a watertight contract. Any number of things could go wrong, and a contract provides vital documentation to protect your legal rights. Of course, it’s also nice to know you’ve got a legal recourse should you not get paid.
Putting together a legally binding contract doesn’t have to be complex. In fact, there are plenty of freelancing contract templates out there designed with the Australian system in mind.
Be sure to include the following at a minimum:
- The price – how much is the project worth?
- The timeframe – how long it will take? Is it a one-off or ongoing job?
- The deadlines – when are specific deliverables and the final output due?
- The payment terms – whether it’s hourly or a flat rate, how and when the client will, as well as late payment fees
- IP ownership – who retains ownership of the work at the end of the project?
- Edits – the number of amendments the client can ask for
- Termination conditions – what happens if either party decides to terminate the project?
Include Legal Statements on Your Website
Even if your freelancing website is just a simple portfolio, it’s still sensible to include all the relevant legal statements. Not only does this protect you from potential lawsuits, but it also bolsters your image as a professional operator who knows how to run a business properly.
Consider the following:
- A privacy statement if you collect any personal information (including cookies).
- Terms and Conditions to outline the rules of your site.
- A copyright statement to explain the copyright status of your content.
Comply With All Tax Obligations
As a freelancer, you’ll be required to withhold your own tax so that you can pay off a massive debt at the EOFY. Therefore, it’s crucial to get in touch with a competent accountant to work out approximately how much you should pay come tax time.
A freelancer will likely have a greater tax payment come tax time than a salaried employee who will have their employer making tax contributions. On the plus side, there are a number of expenses you can claim if you work from home such as internet, utilities, and computer-related expenditure.
Regardless of what you earn, be sure to have a reliable system in place to track all your income and expenses.
Gracefully, content automatically becomes the intellectual property of the creator the second it is made, which means you don’t have to file any paperwork to assert ownership of your work. It becomes a little more complicated, however, when transferring copyright over to a client. The freelancer will often exchange full ownership of their work for a set fee, which means they’re not allowed to resell the content.
Another option that can be more beneficial is to sell the client a license to use your work. In this situation, you’d be able to sell multiple licenses to different clients simultaneously.
Protecting Your IP
People steal stuff all the time on the internet, so it’s worth knowing what to do should it happen to you. The first step is to contact the website or company in question and politely ask them to remove your content from the site. Sometimes people don’t even realize they’ve broken the law and will be happy to oblige.
Failing that, you can send a Digital Millennium Copyright Act (DCMA) Take Down Request to the ISP that hosts the site. Finally, you could consider filing a lawsuit. Suing the copyright infringer could earn you a tidy sum if you can demonstrate they’ve profited from your work. Seek legal advice before beginning the process. Given the astronomical costs involved, most cases settle out of court.
Although the freelance lifestyle comes with a whole host of advantages, its legal and tax obligations can cause considerable confusion. By keeping the above tips in mind, you’ll be well on your way to becoming independently successful in your chosen field.