Billing ethics?

Subject: Billing ethics?
From: Geoff Hart <ghart -at- videotron -dot- ca>
To: "TECHWR-L" <techwr-l -at- lists -dot- raycomm -dot- com>
Date: Tue, 01 Jun 2004 09:07:02 -0400

Lyndsey Amott reports: <<I was recently asked to write a proposal for tightening up the text of 12 subdomains for a company's website. Each subdomain was approximately 13 pages. It took me a total of 18.5 hours to... figure out... [and] write the proposal>>

That's a lot of work, but it sounds like it paid off in that you won the job. Creating proposals and estimations are part of the job. In the future, if you know you're going to spend considerable time creating the proposal, include that time in your estimate of the job--not as a line item in the budget, but rather "buried" in the hourly rate. That's no more unethical than including your computer and office rental costs in your hourly rate for a job.

<<I estimated that it would take me 75 hours to complete the job, and, because I really wanted to write for this company, I said that I would not charge for any hours over 75...>>

That's reasonable. In effect, you've given them a fixed-price bid, or an hourly cost with a billing cap. Both are fairly common ways to bid on a job. The trick is to make those 75 hours work for you so that you don't end up spending 150 hours--which means, as noted above, that your proposal time must be included in the total cost if you want to recover that time.

<<The company accepted the proposal, but stated that they would not make a final decision until I had completed the text for one subdomain.>>

This is also reasonable, but at this point, you're doing work for them and should make it clear that you expect to be paid for that work. As you note below, they behaved ethically by paying you for this.

<<I submitted a first draft as a .txt file and asked them to comment, but they refused, saying that they would prefer not to look at it until I had done all the HTML so that they could read the text in a browser.>>

Again, that's reasonable. You've been asked to produce a better Web site, not just better text, and the only way they'll know you did both parts of the job is to see what you've produced. A compromise you may like: Provide both the HTML file (think of it as "proofs") and a Word file (so they can edit in Word using revision tracking). Instruct them to make changes in Word (faster and easier for them than having to copy text out of the browser and comment on it separately) based on their reviews of the HTML in a browser.

<<I did as they asked, but when they read the text in the browser, they felt that it was not punchy enough and decided to drop the project. They've asked me to send them an invoice for the work I did.>>

That's fair, but if you really want the work and you feel that their comments are reasonable, make a counterproposal: "Let's work together--no charge--to figure out how you'd like me to redo that first section. It should only take one more round of revision to produce something you're happy with, and after that, I can do all the other sections to match. This way, you'll preserve your investment in the project. This 'iterative improvement' is part of the investment we both make in producing something to be proud of."

<<should I bill for the 18.5 hours I spent on the proposal? Without the proposal, I can bill for only 28.5 hours, but with the proposal, the total hours would be 47, which might strike the company as rather unbelievable in light of the fact that I said I'd do all 12 subdomains in 75 hours.>>

As noted above, you can't generally bill for time spent on a proposal. Although you could pro-rate this investment of time over your full estimated time to complete the job, you would be retroactively padding your hourly rate, and if you've already quoted an hourly rate, you can't change it at this point. Next time build the proposal hours into your total estimate so that the client already expects to pay for it.

Also note that if you estimated 75 hours for 12 sections, that amounts to 6 hours per section if the sections are all equal length. Unless the trial section you've already submitted is unusually large, it may be hard to justify billing more than 4 times the estimated time per section.

--Geoff Hart ghart -at- videotron -dot- ca
(try geoffhart -at- mac -dot- com if you don't get a reply)


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