Don’t be to sure about that on many levels.

Recall you can’t sell from an empty wagon.

“I don’t have to pay to be a part of” Typically there is a given that a designer has 2000 hours a year in productive time. What with over head that’s, real world, a lot less. Just how much time can you afford to invest in unproductive work before you’ve nothing left in the creative wagon to sell?

Maybe I’m old fashioned but I don’t bid, I quote and for the most part the quotation format is boiler plate. After the client commits the real work and creativity begins.

I just happen to be an engineer (another somewhat similar creative field) I’m paid not only for what I do but what I can do and the associate skill set and knowledge base I bring to the table. There is never a question or the option that a client should consider much less expect that should they not like the design my work and my skill set are free.

As to the restaurant analogy if the food is bad (say prepared in rancid oil) then not paying is a legitimate option but if I order something and change my mind then I should by rights be expect to pay for what I ordered.

When you tip is the tip based on the physical service delivered by the wait staff or the flavor of the food?

In response to Dizeyner:
About the places you mentioned that charge a monthly fee, at what point have you wasted billable time that equals that fee, with the same no-win results.

The world of professional design revolves around winning and losing quotes. Rather than wasting billable time drawing logos for sites where you are not winning or have very little chance of winning, why don’t you pursue bettering your skills, developing better marketing strategies, better clients, and aiming for higher goals?

I think you may be conflating several issues here. The first (not dealt with in the piece) is how income from design contests is viewed for tax reporting purposes. That’s neither here nor there, in terms of what design contests are, or aren’t. Though I’d agree that anyone who doesn’t report income from ALL sources is “kinda dense”.

As an aside, taxation of design services in Canada is a quagmire. For example, if you’re in Ontario, and e-mail Ontario-based clients files, it is considered a service and therefore not subject to PST. If you hand over a CD, then the artwork becomes a physical product and is taxable. If you FAX a proofs to a client, they’re using their paper so the design work remains a service. If you hand them sheets of paper printed on your system, it may well be considered a product and taxable under PST. A lot of my knowledge in this area comes first hand, thanks to an aggressive crack-down on the design industry a few years ago.

The second issue is how design contests are marketed to people entering (wherein lies the rub). There’s lots of precedent for ‘creative’ contests being viewed, legally speaking, as actual contests, including design, writing and video production. Read the terms and conditions of a promotional design contest (a large corporation for example) and you’ll see how complex they are (several links in the article above), especially when compared with the standard user agreements of your typical design contest site. There’s even a few instances where large corporations, holding contests on sites like 99designs and Crowdspring, have added their own terms and conditions, obviously to follow accepted contest laws and regulations that aren’t covered in the base site version. Apparently, their lawyers know something that we don’t.

Work-for-hire is a legal concept and is more relevant to authorship and ownership of artwork and the transfer of same. That’s hot button issue too – many have opined that work-for-hire agreements claimed by contest sites go beyond what is generally acceptable. Traditionally, work-for-hire applied to actual employees where hardware, software and allowances for time are covered by the employer, and included in the contract. Many view the shifting of work-for-hire provisions to freelance contractors (or in this case, design contest participants) who now have to shoulder all the expenses, to be unethical at best. The designer assumes all the expense, and risk, while giving away at least some ownership of their work, usually under some dodgy user agreement. Some designers have taken on that fight and there’s a few anti work-for-hire campaigns around, including Stop Work For Hire, promoted by some outfit called PAL (Professional Artists League).

They are contests only in principle, not fact. Anybody who thinks they are really contests by the legal definition and doesn’t report their income is kind of dense.