Bloggers have Very Few Protections from companies that pay bloggers to blog in Financial trouble
by
Brett Bumeter
Dosh Dosh put together a partial list of companies that sponsor bloggers to write on a freelance contract or sponsored review type of basis.
see A Definitive List of Paid Blogging Sites: Ways to Make Money Online
Kalpesh points out in comment 102
With so many sites active it makes one wonder, how many will survive? Do any of these sites have a method of protecting a blogger’s earnings if they land in financial trouble?
The response to this insightful comment is that Bloggers are almost completely exposed.
The answer is that none of the companies mentioned in the Dosh Dosh article have any means of protecting bloggers earnings in place. *Disclaimer - My company owns one of the companies listed in the Dosh Dosh article.
That’s not terribly surprising as most companies do not have any means of protecting their employees earnings either. If a company goes bankrupt, its just bankrupt.
There is no escrow service or anything like that for what is essentially a form of ‘micro-contracting.’
Therefore, the best protection that a blogger can utilize (if they are worried and thousands are not) is to work with companies that pay as rapidly after completing piece work as possible.
But even then, PayPal does not protect payments you receive from these companies either.
Therefore, lets say that any one of the companies went bankrupt tomorrow (its a new industry, less than a year old and that is definitely possible if you look at the percentages of new companies that survive 5 years). If pay a blogger to blog company XYZ went bankrupt on Aug 3, the bankruptcy courts could freeze all future payments immediately to bloggers. Plus, the bankruptcy courts could force the reversal of all payments made 90 days prior to the bankruptcy (if the company has a creditor that gets in line or has a stronger claim that a blogger or a collective of bloggers, which would be very likely since most of us bloggers are not going to lawyer up to protect ourselves from losing a few hundred to a few thousand dollars as the cost of the lawyer and the bankruptcy filings would be much more expensive, unless you happen to be a bankruptcy lawyer or a credit officer experienced in this area.
So to put it simply bloggers are completely at risk. As a blogger, I experienced a situation where one of the companies in the list above had their payment to me reversed by Paypal, which helped illustrate the point. The company later made good on the payment, but PayPal is definitely a week link in this industry.
PayPal protects ebay transactions, but they do not protect contract payment transactions. Ebay owns paypal.
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