Upwork Increasing Fees for Clients & Freelancers

[Lex DeVille]

Hi Alexander,

I'm writing to let you know about upcoming changes to our fees starting in June.

Introducing a payment processing fee to clients
To offset high payment servicing costs, we'll start charging a fee to process your payments.

By default, a 2.75% processing fee will be charged per payment.

Alternatively, you're eligible to pay a $25 flat monthly fee (instead of 2.75% per payment) if you pay exclusively with your bank account. If you expect to spend over $910/month, we recommend this option as you'll save on fees.*

To learn more, visit our client pricing page.
Updating the service fee freelancers pay
The service fee that freelancers pay to Upwork will change from a flat 10% to a sliding fee per client relationship, decreasing the more the freelancer works with a client:

• 20% for the first $500 billed with the client
• 10% for lifetime billings with the client between $500.01 and $10,000
• 5% for lifetime billings with the client that exceed $10,000

When a freelancer has billed enough with a client to qualify for a lower fee, they'll see an automatic increase in their take-home earnings. The client will pay the same rate on existing contracts.

To learn more, visit our freelancer pricing page.

Building a business for the long term
These pricing changes are meant to reward long-term, repeat work and cover the costs of serving all parties on our platform—allowing us to support you better over the long run.

What should you do next?
Over the next several weeks, we'll follow up with more details on when these changes will take effect. In the meantime, review our client and freelancer pricing pages and updatedTerms of Service. Thank you for your understanding and your business.

Sincerely,

Stephane Kasriel
CEO, Upwork

Here's a link to a page that goes into detail about it:

Upwork Freelancer Pricing Page

Higher fees might mean clients end up less willing to pay Freelancer rates.

Freelancers better step up your game.

Better to move clients away from the platform ASAP and work on those referrals.

 

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[Bruh]

Was just about to post about this. Is it crazy or what?

People have been complaining about Upwork ever since it came to be. Nobody wanted to leave Elance when they shut it down. At that time, it seemed like the perfect opportunity to build a replacement but I don't think anything has caught on as an Elance replacement. I really miss Elance.

Has anyone tried the alternatives?

It seems like most people don't actually like Upwork but keep on using it anyway. They say they're gonna leave but do any of them actually do so?

 

[Lex DeVille]

Was just about to post about this. Is it crazy or what?

People have been complaining about Upwork ever since it came to be. Nobody wanted to leave Elance when they shut it down. At that time, it seemed like the perfect opportunity to build a replacement but I don't think anything has caught on as an Elance replacement. I really miss Elance.

Has anyone tried the alternatives?

It seems like most people don't actually like Upwork but keep on using it anyway. They say they're gonna leave but do any of them actually do so?

One Fastlane member was working on a website to compete with Upwork, but I don't know if he's made progress on it.

The only thing I like about Upwork is it's the most trusted platform.

That makes it easy to connect directly with the founders at important companies.

 

[Equilibrium]

the only thing keeping upwork together is its client base.

 

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[The-J]

The only reason people use Upwork is because it literally gobbled up the biggest client bases on the Internet.

I need to get both my pipeline and my freelancers off of Upwork's platform.

Commandment of control, ladies and gentlemen

 

[carlolacson]

Damn, just like that then booom. Just like the story in Mj's book. That's what happens when you depend on something you can't control -_-

 

[healthstatus]

its $25/month! You probably pay your credit card processor 4% or more. How much are you going to spend in time moving people off the platform? I don't like upwork interface as much as Elance, but oh well.

 

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[Vigilante]

20% for the first $500 you bill your client across all contracts

nope

 

[Jake]

Funny because I just created my first upwork job today. It's with a lady I used in the past from elance so was automatically migrated. I'll have to see if I have her email address anywhere.

Thanks for the heads up.

 

[SweetTooth]

I couldn't believe it when I saw it. I'm literally just starting to make good enough income to move to Thailand and live off of and Upwork now wants to take 20% of my income + processing fees. As angry/shocked as I am about it, it's not like I wasn't expecting something like this to happen in the back of my mind. TMF warned us about this, we don't have control so with a single snap of a CEO's fingers our entire income can be reduced. Now Upwork will be the one to really suffer the consequences as clients get away from their platform and onto their own portfolio website or a competitors.

**MJ sits in the background with a wide grin saying "I told you so"**

 

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[Lex DeVille]

Now Upwork will be the one to really suffer the consequences as clients get away from their platform and onto their own portfolio website or a competitors.

My most recent client found me through a website I set up over a year ago. A website that barely has any copy and no SEO work. Basically something I started and never finished. One single page. They tried to contact me through the site, but it didn't work because it wasn't complete. I forgot all about it.

Then they went to Upwork and found me there.

The point is...set up a website to target whatever niche it is that you work best for. You might be the only one doing it and you might be sitting at the top of Google with just a little bit of SEO work, or in my case, no SEO at all.

 

[MJ DeMarco]

**MJ sits in the background with a wide grin saying "I told you so"**

YUP. This is what happens when customers are no longer the priority, but appeasing VCs, investors, and shareholders. Squeeze the towel, and suck it dry.

G00GIe "upwork increasing fees" -- this thread currently sits at #2.

20% on the first $500? Wow, does that suck a$$.

 

[Lex DeVille]

G00GIe "upwork increasing fees" -- this thread currently sits at #2.

That means don't post about migrating clients from Upwork's platform unless you don't care about not working on Upwork's platform anymore.

 

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[anonymous_dev]

YUP. This is what happens when customers are no longer the priority, but appeasing VCs, investors, and shareholders. Squeeze the towel, and suck it dry.

G00GIe "upwork increasing fees" -- this thread currently sits at #2.

20% on the first $500? Wow, does that suck a$$.

I signed up to post here on this topic. Last night i stumbled upon ziptask while looking for alternatives. Since this thread sits at #2 in the rankings for this crucial topic. Short take on ziptask: like upwork with subtle differences and an 8% fixed fee paid by the client- no fee for freelancers. Obviously I haven't landed a contract yet. After carefully reading their terms of service, its clear that the service is not free of caveats:

- you may set a weekly rate for your services. after reviewing your profile they will reassess this figure. Mine dropped from $760 to $560, or $14/hr which isn't bad for a new contractor without any feedback. The terms state that you can renegotiate your fee later.

- you may only choose to work in 10hr, 20hr, or 40hr fixed price agreements per week.though this isn't documented on their platform, i just stumbled upon it in my settings page. you can set your availability in these 3 blocks. kind of odd but i guess it could be workable. its unclear whether hourly engagements are supported and if timetracking is available.

- clients can only hire you after first hiring you for a 20-hr paid test task, which you will be awarded 50% your weekly rate. if the client is unhappy and you lose the disintermediation, you get paid nothing and the client is paid back.

Obviously, for me these 3 points either seem like quirky, but possibly fruitful risk mitigation strategies or a huge redflag. I haven't decided yet. I'm going to give it a try and see what happens. In the end i may have to return to upwork.

 

[DrunkFish]

Ah, didn't see this thread. Hard to believe that with all the complaints of the 10% they decided to go ahead and double it. Especially now that they took over the other main freelancing site.

 

[healthstatus]

They aren't taking 20% of your fees, they are taking 10% additional on your first $500.00 and taking 5% less if you have a client you do over $10k with. My guys are all ecstatic, they are getting 5% more a month.

 

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[Jon L]

I have had several interactions with their customer "service" department over the last few months. Most of them have been the close to the worst customer experiences I've ever had...in my life (AT&T from about 10 years ago was the all-time worst).

And now they want to raise rates? They must be pretty sure of their market position.

Time to diversify.

Curious what other people have tried? Does anyone have any experience with TopTal?

 

[anonymous_dev]

I have had several interactions with their customer "service" department over the last few months. Most of them have been the close to the worst customer experiences I've ever had...in my life (AT&T from about 10 years ago was the all-time worst).

And now they want to raise rates? They must be pretty sure of their market position.

Time to diversify.

Curious what other people have tried? Does anyone have any experience with TopTal?

I tried toptal and after 5 interviews i was notified via email that i was rejected from their applicant pool. They only want people with 5 years experience and very diverse skillsets.

 

[Jon L]

I tried toptal and after 5 interviews i was notified via email that i was rejected from their applicant pool. They only want people with 5 years experience and very diverse skillsets.

has anyone ever hired people off of toptal?

 

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[deepestblue]

I have hired freelancers on the site called 'Freelancer' for years and have had excellent experiences pretty much across the board. In my experience, there are not as many U.S.-based freelancers there however compared to say Upwork or Guru.

 

[Fox]

I bounced off UpWork within two week. Four jobs total, I quit on the fourth since the client changed their mind for the 20th time after I already finished the work and said "I had to do it or I would get a bad review". Went straight to the source and started cold calling and emailing companies. Already have built a large network and am getting 60%+ referral jobs. Increased my hourly rate from $10 to close to $70. UpWork did teach me some lessons though.

 

[Equilibrium]

I bounced off UpWork within two week. Four jobs total, I quit on the fourth since the client changed their mind for the 20th time after I already finished the work and said "I had to do it or I would get a bad review". Went straight to the source and started cold calling and emailing companies. Already have built a large network and am getting 60%+ referral jobs. Increased my hourly rate from $10 to close to $70. UpWork did teach me some lessons though.

when you say cold calling, what was the business? what were you looking for? and what was your yes/no ratio on calls made?

 

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[YoungPadawan]

I bounced off UpWork within two week. Four jobs total, I quit on the fourth since the client changed their mind for the 20th time after I already finished the work and said "I had to do it or I would get a bad review". Went straight to the source and started cold calling and emailing companies. Already have built a large network and am getting 60%+ referral jobs. Increased my hourly rate from $10 to close to $70. UpWork did teach me some lessons though.

I will be doing the same and going straight to the source.

 

[Fox]

when you say cold calling, what was the business? what were you looking for? and what was your yes/no ratio on calls made?

I build websites. My best contract on UpWork was $300 hours. Now I work for between 2-3k a week.

I deleted my account but if you go search for a "website needed" post you will find 50-150 people applying within 20 minutes. I found that the cheaper the job the bigger the issues, while the well priced jobs had insane amounts of people applying... no thanks. No matter how good your application is that is poor odds everytime.

I search out companies that average individual sales of between 2k - 10k or deal with contracts worth 100K+. If they have a poor website and I only improve their sales by a small margin its still a big gain that easily pays off my work. Of course I aim to improve their sales by a lot but its an easy pitch. Its very easy to find companies that need a new website since its all publicly available and easy to search. I don't have to guess, I just check.

I usually email first and then call the next day. I have actually made very few calls since I keep selling websites within a few calls. Referrals have been high and I have about 6 - 8 sites that need completed within the next few weeks. I am hiring someone in Canada to work on sales and am about to look into outsourcing content writing soon. I have only learned coding since January so things are moving fast. I was going to make a new thread on it but want to wait till I am really crushing it. Its not fastlane yet but I am making good money to deal with a lot of businesses and see what their needs and problems are. Plus I have a feeling my coding skills will be coming in handy very soon...

 

[Fox]

It makes so much sense now but trying to compete as a commoditized service was very foolish. Once I switched things up and marketed myself differently I could charge 5-10 times more. Still the same skill set and time spent but now I am solving bigger problems for bigger clients.

I can make a website for Joe who sells hats and runs at a $3 profit margin or I can build a website for Jeff who sells concrete to huge building projects and thinks in terms of $100-500k contracts. Same product, same code, same time spent, 10x profits and surprisingly (or maybe not since that's why he is successful to start with) way less issues.

Edit*** I just searched "concrete Arizona" as an example and found this on the second page http://mobilemixaz.com/index.php

Why use UpWork when I can put in "niche industry + town" and find 10 pages of companies who need websites. No competition, no service fees.

 

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[Growth & Learn]

Yeah saw they were increasing prices. IMO this will be a big tactical error on their part. People don't have loyalty to Upwork. They go there because they have a large pool of contractors. Once contractors start leaving their in mass people will have no reason to do business with them.

If you're going to increase prices at least include more services or features to justify price increases. They didn't do that.


People have loyalty to many brands because of their USP, service, relationships, affordability, etc. Upwork now has none of that.

 

[Jon L]

It makes so much sense now but trying to compete as a commoditized service was very foolish. Once I switched things up and marketed myself differently I could charge 5-10 times more. Still the same skill set and time spent but now I am solving bigger problems for bigger clients.

I can make a website for Joe who sells hats and runs at a $3 profit margin or I can build a website for Jeff who sells concrete to huge building projects and thinks in terms of $100-500k contracts. Same product, same code, same time spent, 10x profits and surprisingly (or maybe not since that's why he is successful to start with) way less issues.

Edit*** I just searched "concrete Arizona" as an example and found this on the second page http://mobilemixaz.com/index.php

Why use UpWork when I can put in "niche industry + town" and find 10 pages of companies who need websites. No competition, no service fees.

I find the same thing. The big clients with the most money are the most appreciative, pay the fastest, give me the least hassle, and are the nicest to deal with.

My favorite story from Odesk was this guy that wanted "something like airbnb" for $1000-$5000. I used up one of my application points to write to him and say, 'you do realize that airbnb has raised $850m so far, right?'

He responded by calling me a douche. I suppose that made us even. It was the last time I tried doing any work on Odesk.

 

[TedM]

I hire a lot on oDesk and in addition to this issue - their website is terribly buggy. constant issues with basic stuff..

 

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[Equilibrium]

My favorite story from Odesk was this guy that wanted "something like airbnb" for $1000-$5000. I used up one of my application points to write to him and say, 'you do realize that airbnb has raised $850m so far, right?'

This is the funniest things I have heard this week.

 

[GuestUser141]

Was just about to post about this. Is it crazy or what?

People have been complaining about Upwork ever since it came to be. Nobody wanted to leave Elance when they shut it down. At that time, it seemed like the perfect opportunity to build a replacement but I don't think anything has caught on as an Elance replacement. I really miss Elance.

Has anyone tried the alternatives?


It seems like most people don't actually like Upwork but keep on using it anyway. They say they're gonna leave but do any of them actually do so?

I was of the same mindset,when freelancer bought out odesk, leave now.

However I wrote and made suggestions,2 months later I left as no improvement....

Before leaving as an employer, i choose to conduct numerous interviews in order to build a network of contacts. By investing no more than 500.00 in creating small projects,this approach has allowed me to gain useful freelancer contacts,for when needed.

Example, I recently had a server issue which I needed a quick fire resolution .
I was able to draw upon my freelancer list and overcome my issue at minimal cost.
Most importantly utilize resources,gain valuable human resource skills, all without the recurring costs,associated with freelance sites.