How to avoid being scammed on oDesk (the right way).

There is another thread making it's rounds that suggests a rigorous interview process and a painful process for both the contractor and project creator.


Having used oDesk for many years I can tell you what my experience has been and what the best way to ensure that both you and the developer get paid for the work.




When you showed up on oDesk unless you have the unusual requirement of "ongoing undefined work" then take an hour or two to define the project scope well. Do it with mockups, do it with a flowchart, do it with a conversation about the data. Your contractor may not speak your language natively, consider that when communicating.


Then, put together a PROJECT BASED JOB and set many small milestones!


Once you put together milestones and only escrow funds for each milestone your risk as a client is substantially limited.


Don't get me wrong, hourly work can go well if you really have the time to stay on top of the contractor, but my personal experience is that hourly work fails more than it succeeds unless both the client and developer are committed to constant day to day communication via a chat client like Skype or Slack.


If you do enable hourly work, don't allow manual work, ever. There is just no good reason to allow a person you don't know to have access to claim that they just did a bunch of work.


Honestly it suprises me that oDesk defaults to allowing manual entry, I would bet that 90% of their fraud and disputes are over manual entry.


If you do allow hourly work, review the timelogs and screenshots daily, if you see anything weird or if feels like the contractor is spending an awfully long time doing something, contact the contractor immediatley and ask for a detailed explanation of exactly why they needed 9 hours to review the same document over and over.



Cliff notes?


Project with milestones = good

Hourly = bad




Hi Arlo,

Thanks so much for sharing. It sounds like you have a sound approach for managing fixed price jobs and strongly prefer this format. Nothing wrong with that.


We don't discourage hourly jobs and in fact have found many clients and freelancers who work successfuly in this format. They certainly follow much of the advice you share for these jobs in your post.


So while we disagree that hourly jobs are bad (we wouldn't allow them on the platform if they were), your advice is important for all clients to know:


If you do allow hourly work, review the timelogs and screenshots daily, if you see anything weird or if feels like the contractor is spending an awfully long time doing something, contact the contractor immediatley and ask for a detailed explanation of exactly why they needed 9 hours to review the same document over and over.


Thanks again.


Hey, there, Arlo...


I'm glad you have found a strategy that works well for you.


I'm mostly a contractor on oDesk, but I have hired a couple dozen contractors. As a cient, I hire using both hourly and fixed rate contracts, and I work as a contractor using both models as well.


Nearly always when I work with clients, I send them bids for the same project using fixed rate contracts and also using hourly rate contracts, and let them pick which they prefer. The fixed rate model is a popular choice, but it's not always what clients choose, and it's not always the best choice for every type of work.


Obviously hourly contracts don't work with contractors you don't trust to provide great value. I think that houly contracts DO require more trust.


I routinely provide bids with an hourly rate and an estimated number of hours that a project will take to complete. And I provide fixed rate contracts which are calculated at twice what the estimated hourly cost would be. Usually clients choose the fixed rate contract, but not always.


Here are some reasons why I think my clients who choose hourly contracts like to use the hourly model:


Hourly contracts are:


1. Simple. There is no need to write up contracts or project plans. There is no need to set up milestones or new contracts. There is no need to submit work or release payment.


2. Flexible. They can ask me to do large projects or little things. They can shift priorities around any time they want. And I don't mind. Because I'm getting paid for my time.


3. Have no limitations when it comes to asking for work outside of the scope of the written contract.


4. Can be used to spend more time working on creating higher-quality back-end source code, rather than simply providing something that "works." I keep my clients appraised of what I'm doing. Sometimes I work on improving the back-end architecture simply for better modularity or better future maintainability, doing work that doesn't create any actual new features. This type of work can be more difficult to fit into a fixed rate contract.


To your credit, Arlo, you recognized that hourly contracts work best for "ongoing undefined work." But I don't think that type of work is as "unusual" as you seem to suggest. Unusual for you, perhaps, but routinely needed by many clients.


Finally, I really don't mind fixed rate contracts at all. I prefer fixed rate contracts for certain types of jobs. But there are some types of projects which are simply too nebulous in nature to accurately predict how long it will take, and there are some types of projects in which the client really doesn't want to be locked down to any specific description or feature set. So for some projects, I'm not available to do the project as a fixed rate project, only as an hourly project. And faced with the prospect of having somebody else do the project, or having me do it as an hourly project, some clients are thrilled to be able to hire me using an hourly contract.


I know MANY contractors on the Community Forum who have had the same experience that I have had: Our clients have been pleased with our work but just out of the blue have requested that they be allowed to pay us higher hourly rates. So when there are plenty of clients on oDesk who become uncomfortable with a contractor's hourly rate because they think the rate is too low, I don't think that every client thinks that hourly rates inevitably lead to being scammed.

HI Arlo,


Speaking as a 5 star freelancer who works manual hours:


Preston is correct when he talks about some jobs being more conducive for hourly payments. As Preston said, there's the fliexibility of being able to contact a freelancer and asking them to do a little bit of work here and there, as you need it, without having to create a whole new job or milestone.  There are also some jobs that are ongoing, like managing content on a website. No need to create a new milestone every time a minor change has to be made.


Now, about the manual hours issue - Not every job involves typing on a computer keyboard 100% of the time. If you hire a good, creative person, they are going to be spending time thinking, researching, drawing sketches on paper, etc. - depending on the work they do. If I'm going to be writing about a technical topic, for example, I'll be spending a lot of time reviewing papers. The client is not going to see any activity. But they are going to get a  hell of a better result than they would from someone who records their mouse clicks as they copy and paste from Wikipedia  To be honest, I wouldn't expect much quality from a freelancer who spends close to 100% of their time typing or moving their mouse. When are they thinking about what they are doing?  It all comes down to trust and your relationship with your freelancer, really.