I'm kind of like an long-time, in-house it/marketing shop for a small startup. I bill them monthly but for whatever hours were put in that month... no min or max, contractual-speaking and this has been working fine.
We recently contracted a company to do some stuff outside my wheelhouse. It still rerquired hours from me managing and working with them, but the final product was to be delivered by them. There was a very tight turn-arounnd for this project, so the company I work for paid them up front in full (via credit card). Buyer Beware.
Long story short, they did sh*@$y work and missed deadline. we still don't even have the final product, deadline aside... they're contract states "money back guarantee" and all that which I have called them out on, but they are giving some fierce pushback and handing me off from this department to the next as I try to get a refund for my client.
My issue is this: it's not my money directly lost to this vendor, but it might as well be. If I was a salaried employee, i wouldn't think twice about it. But I'm not going to bill them for a project they paid me to manage (and be a part of) when there is no deliverable. I obviously don't have a legal team to go after them with, not does the the company I'm working for. They have general counsel (contracted), but at $400/hr, they're inclination is just to just let it all go.
When you do the math out, i know it still probably makes sense to have my client's pursue some sort of legal action. They don't see it this way... understandably (in the end, their time is worth more than the lawyer's rate + my rate). They don't want to spend any more time hearing from me that they won't give a refund and that I'm doing X, Y and Z about it. They just want to get the project done and done right.
So I know it's my choice not to bill them for the work I did on that project, and if they were a 1-time client I'd tell them they were on their own and bill for my time. But this is not the case. I'd have a hard time doing that to anyone, much less a bread-n-butter client like this. like i said, I can't, in good faith, bill them for work on a project done in any unsatisfactorily manner.
Not sure if my best move is to play chicken and send them some sort of legal notice (under my name or the company's name)... or whatever. In the end, I don't want to eat those hours (and lose a good foothold with this client), which is what I'll have to do if the company won't move forward with any action... and then nobody wins.
All of this is causing me and my client crazy stress. For me, in addition to having an unsatisfied client (when I told them they'd be more than satisfied), I have a a chunk of hours that I don't feel good about billing. A for them, as discussed with them, they don't feel good about paying.