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1214685c
Community Member

Prepay 50% upfront?

We found a freelancer we like with a 100% rating on Upwork. He initially suggested hourly for our project to which we agreed.  We asked him for a ballpark total to make sure we knew what we were getting into.  Now he would like prepayment of 50% of the project total before even starting. It's more than $1K.  Is this normal?  

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yitwail
Community Member


Heidi A wrote:

We found a freelancer we like with a 100% rating on Upwork. He initially suggested hourly for our project to which we agreed.  We asked him for a ballpark total to make sure we knew what we were getting into.  Now he would like prepayment of 50% of the project total before even starting. It's more than $1K.  Is this normal?  


Heidi, in addition to the excellent advice everyone's given, do not attach undue importance to a 100% Job Success score. For freelancers without a lot of experience, one subpar job can drastically lower it. Conversely, even highly experienced freelancers routinely experience the score fluctuate. For instance, while I'm currently at 100%, I've also been at 99%, 98%, and 96%, but I was the same freelancer at 96% as I'm now at 100%.

__________________________________________________
"No good deed goes unpunished." -- Clare Boothe Luce

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31 REPLIES 31
louisaj
Community Member

It's not normal, no. That's why Escrow and hourly protection is there. He may be legit, but I'd not allow him the money upfront, especially not this amount. This screams alarm bells. What's to stop him running off with the money? Nothing.

 

If the freelancer logs his hours using the tracker, then he will be paid. There is no need to pay him upfront. Don't do it. If he is not happy with this, there are thousands of freelancers on this platform who you can hire.  

 

 

1214685c
Community Member

Thank you Louisa! 

3c0634c2
Community Member

This is a bad argument because that would make every business a scam.

You walk in the store to buy groceries, well guess what? You have to pay before you can take those groceries home. 

re: "You walk in the store to buy groceries, well guess what? You have to pay before you can take those groceries home."

 

It is not clear to me if you intended to advocate for upfront fees, or not.

 

But your example about the grocery store supports the side who advocate AGAINST upfront fees.

 

When you pay for a can of soup at the grocery store, you already have the can of soup in your hand. Then you pay for it and take it home. That is not an upfront fee.

 

An upfront fee means paying money to a freelancer before he has done any work, and accepting the face that the money is gone forever whether he decides to do the work or not. You might get the can of soup. You might not get a can of soup. You might get an empty can. You might get a jar of pickles.

yes but the store wanted the buyer to pay before they left with their soup. (lol) So If I'm a seller on upwork I want my buyer to pay me first, we've really goofed things up.

It's not like that anywhere you go except for online.

Yes, but on Upwork you are online and asking for upfront payment doesn't work unless it is a fixed price gig and the client agrees to pay the freelancer first by releasing a milestone before the work is done, which is unlikely.  If you don't like the system, you're not obliged to stay.  

 

As to the store, it is equally unlikely that a store will allow you to eat something before you decide to pay for it.  Generally, refunds are in operation, if once you have paid, you have a genuine complaint about the product. 


Nichola L wrote:

 

As to the store, it is equally unlikely that a store will allow you to eat something before you decide to pay for it. 


*cough* dine-in restaurants *cough*

That is very true, kinda weird actually. There are some places that you pay upfront, like buffet's. Also, think about grubhub or doordash. Once again, the buyer pays the provider first before they receive their food.

It's weird that we trust so many companies but when the topic of services are mentioned everyone is like no, the seller gets paid after services are rendered. 

that's what people must have thought when ebay came out....like no, I'm not sending money to someone I don't know.

hmm, sounds to me like the system needs help. 

Yes but *cough,  I didn't say a "dine-in restaurant". I said "store". 😏

 

Funny.

 

But it is easy to get lost with all these analogies and comparisons.

 

Bottom line remains that different places have different customs and policies with regards to upfront payments. None of those really matter because this is Upwork. This isn't a grocery store or dine-in restaurant or any place else.

Why is it unlikely? There are fields in which partial payment up front is the norm, and clients are perfectly willing to operate the same way they would offline. 

 

I don't take advance deposits on most jobs (though a great many writers do), but I do on a large project that will involve many hours of work before there is a deliverable. That has only come up a few times on Upwork, but I've never had a client question it or hesitate. I think the largest advance payment I've gotten on Upwork is $2000 or 2500, but out in the wilds it might be $5,000 or more depending on the scope of the project.

versailles
Community Member


Heidi A wrote:

We found a freelancer we like with a 100% rating on Upwork. He initially suggested hourly for our project to which we agreed.  We asked him for a ballpark total to make sure we knew what we were getting into.  Now he would like prepayment of 50% of the project total before even starting. It's more than $1K.  Is this normal?  


Don't. Upwork has an escrow system. The've been many clients who were scammed by paying upfront. Don't do that.

 

Also Upwork has an hourly system.

 

 

-----------
"Where darkness shines like dazzling light"   —William Ashbless

Thank you Rene.  As newbies to this platform, we appreciate this expert guidance from the community.  

feed_my_eyes
Community Member


Heidi A wrote:

We found a freelancer we like with a 100% rating on Upwork. He initially suggested hourly for our project to which we agreed.  We asked him for a ballpark total to make sure we knew what we were getting into.  Now he would like prepayment of 50% of the project total before even starting. It's more than $1K.  Is this normal?  


It's not "normal" but I've done this once or twice with new clients who have a large project and no previous Upwork reviews. However, I've recently become aware that there are a lot of freelancers on Upwork who buy and sell accounts that have 100% ratings; there are also freelancers who purchase fake reviews. So, I wouldn't necessarily advise you that it's a good idea to trust anyone and pay $1,000 upfront; in fact, if I were you, I would probably refuse. If this is a fixed price project and you put the payment into escrow and don't release it until you review the freelancer's work, you'll be a lot safer.

 

Obviously, it'll be within the freelancer's rights to refuse to work with you if you can't agree on terms, so it depends on how badly you want to hire them.

 

Q. What if I hire a freelancer using an hourly contract, and she does nothing?

A. Then you pay nothing.

 

Q. What if I hire a freelancer using a fixed-price contract, with $1000 in escrow for the first task?

A. Then the money can not be released to the freelancer unless YOU release it. But also: If the freelancer does not actually do any work on the project, you can't get the money back, unless the freelancer AGREES to let you have the money (or the matter is decided in your favor during arbitration, which costs you $291, non-refundable).

 

Q. What if I hire a freelancer and release a $1000 up front payment to her, and she does nothing?

A. That money is gone. There is nothing Upwork can do to get it back. You may ask the freelancer to refund the money back to you, but any such refund would be done on the "honor system."

 

Q. How can I manage my project without potentially losing a lot of money?

A. Use an hourly contract and monitor the work. Or use fixed-price contracts/milestones, but start out with small ones. Instead of funding a LARGE escrow payment, fund only the first task, or the first part of the first task. $50 or $100. Then see if you like the freelancer's work. If the freelancer provides work that you like, at a value you appreciate, then you can fund increasingly larger milestones or contracts. Because the freelancer has proven herself.

Thank you for this detailed information.  We like the escrow option, but were taken aback with this prepayment request.  We're new to the platform and certainly want any person we hire to be 100% confident that we'll treat them well.  


Preston H wrote:

Q. What if I hire a freelancer using a fixed-price contract, with $1000 in esrow for the first task?

A. Then the money can not be released to the freelancer unless YOU release it. But also: If the freelancer does nothing, you can't get the money back, unless the freelancer AGREES to let you have the money (or the matter is decided in your favor during arbitration, which costs you $291, non-refundable).


I'm pretty sure funds can only be held in escrow for 3 months, and after that, it will automatically be refunded to the client. So it takes some time, but if the freelancers does nothing there is no need to go to arbitration for it. The client will get the money back, but it takes some time. 

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Eve L wrote:

Preston H wrote:

Q. What if I hire a freelancer using a fixed-price contract, with $1000 in esrow for the first task?

A. Then the money can not be released to the freelancer unless YOU release it. But also: If the freelancer does nothing, you can't get the money back, unless the freelancer AGREES to let you have the money (or the matter is decided in your favor during arbitration, which costs you $291, non-refundable).


I'm pretty sure funds can only be held in escrow for 3 months, and after that, it will automatically be refunded to the client. So it takes some time, but if the freelancers does nothing there is no need to go to arbitration for it. The client will get the money back, but it takes some time. 


That's not all. If the freelancer does nothing, and the client cancels the contract, and the freelancer still does nothing, the money goes back in 7 days.

 

Furthermore, it is also false to claim that the arbitration fee is non-refundable. This is only the case if arbitration goes ahead.


Plus, it is false to claim that the money in Escrow can only go to the freelancer if the client releases it.  If the freelancer submits for payment and the client does not react,(having been misled to believe that the funds can not go to the freelancer unless the client releases them for example) the funds are automatically released to the freelancer after 14 days.

 

Wow, this is informative.  Really good to know.  I appreciate your taking the time to provide your insights! 

yitwail
Community Member


Heidi A wrote:

We found a freelancer we like with a 100% rating on Upwork. He initially suggested hourly for our project to which we agreed.  We asked him for a ballpark total to make sure we knew what we were getting into.  Now he would like prepayment of 50% of the project total before even starting. It's more than $1K.  Is this normal?  


Heidi, in addition to the excellent advice everyone's given, do not attach undue importance to a 100% Job Success score. For freelancers without a lot of experience, one subpar job can drastically lower it. Conversely, even highly experienced freelancers routinely experience the score fluctuate. For instance, while I'm currently at 100%, I've also been at 99%, 98%, and 96%, but I was the same freelancer at 96% as I'm now at 100%.

__________________________________________________
"No good deed goes unpunished." -- Clare Boothe Luce
1214685c
Community Member

Thank you.  This is so very helpful!  

scottfine
Community Member

I'm a "top rated plus" developer with 25 completed Upwork jobs and over $50k in earnings. On jobs over $2k I *always* ask for 50% up front. I've learned the hard way that I must. I've had clients take as long as two months past the project completion date to even respond to my messages, let alone approve completed milestones. There's nothing a freelancer can do when that happens (except to submit a milestone for payment without getting prior approval from the client). I can't afford to spend weeks on a project and have payment held up indefinitely, whether the money is in escrow or not. So I require half up front. It's not a red flag. It's what a professional freelancer has to do to maintain revenue. (Also, someone mentioned in these comments that people sell Upwork profiles to scammers. That doesn't sound plausible to me at all. I've worked very hard to establish myself here and it's an important part of my business. A person who is willing to do the work to earn a very strong Upwork reputation would not likely be reckless enough to sell it to a con artist.)

Scott:

If a client hires YOU, then she has nothing to worry about.

But what if she hires a scammer freelancer?
And releases an escrow payment upfront, before any work has been done?
Then that money is gone forever.

 

I assume that most freelancers asking for upfront payments, despite the presence of Upwork's escrow system, are scammers. That is why I regularly advise clients to not hire freelancers who ask for upfront payments.

Preston, I would be wary if the freelancer doesn't have a firmly established Upwork history with jobs of similar scope, a very high rating, and consistently very positive client comments. But if the freelancer does have all the above, they earned it -- and if they put the work into earning it, they aren't going to sell their profile (because you and I both know what that profile is worth over the course of a year). As I wrote above, there is a very good reason for a freelancer to require a cash deposit. Can you present any confirmable evidence of a single instance where a client has been outright scammed on a deposit by a well established top-rated Upwork freelancer? 

re: "Can you present any confirmable evidence of a single instance where a client has been outright scammed on a deposit by a well established top-rated Upwork freelancer?"

 

I'm just speaking based on what I reading the Forum.

 

Because I personally refuse upfront payments when clients offer them to me.

 

So this is not from first-hand experience.

In the Forum, there are many examples of clients who say that they were "scammed" by freelancers who asked for upfront payments and then never delivered any work.

 

I don't know if those freelancers had the criteria that you specified would be critical to look at.

 

So I would be happy to agree with you that those freelancers did NOT have a strong profile with positive feedback.

 

Even if I agree that you are completely correct about all this, I am still faced with the choice about whether to:

a) advise clients to never work with freelancers who ask for upfront payments

[or]

b) advise clients to not work with freelancers who ask for upfront payments unless those freelancers meet certain requirements.

 

If one actually goes back and looks through my posts, I think there is a mixture of these. Depending on how much detail I go into and depending on the precise nature of a client's question, there are certainly posts in which I keep things simple and advise clients to not do it, and there are posts in which I point out that they can do it if they want to, if they trust the client, etc., as long as they understand that they can't get upfront payments back.


Scott F wrote:

I'm a "top rated plus" developer with 25 completed Upwork jobs and over $50k in earnings. On jobs over $2k I *always* ask for 50% up front. I've learned the hard way that I must. I've had clients take as long as two months past the project completion date to even respond to my messages, let alone approve completed milestones. There's nothing a freelancer can do when that happens (except to submit a milestone for payment without getting prior approval from the client). 


Frankly, you are not using Upwork properly then. The purpose of the automatic release of the milestone after 2 weeks is to protect you from nonpayment should the client go quiet. If the client fails to review the submitted work, then that is on them. Contracts have delivery time frames and milestones that both parties are subject to, and you can't be responsible for the client managing their own project. 

 

As Preston noted, most freelancers asking for release of milestones up front are attempting to scam clients. There is really no reason to do so using the Upwork system, since the funds will be in escrow and automatically released if they fail to respond. 

Amanda,

I don't think any of us have any non-anecdotal evidence about what the proportion of scammers to legit freelances requiring a cash deposit is.  While a scam sounds plausible for a brand new profile with little or no track record, it sounds very far fetched for any profile with a top-rated badge.

You wrote "If the client fails to review the submitted work, then that is on them" -

I never submit a milestone for payment without getting an acknowedgement from the client first. That's not how I handle accounts and run my business. I have to balance ongoing client relationships and my Upwork rating against sometimes substantial disruption in my revenue stream.

You wrote: "Frankly, you are not using Upwork properly then" - 
I'm definitely not breaking any of Upwork's rules, and my clients are very happy. I think I am using Upwork properly.🙂

Scott:
I really do not think you have anything to worry about.

 

You have some techniques worked out that are effective for you.

I don't believe you are violating any Upwork ToS rules. I don't believe that Upwork is going to begin expressly prohibiting upfront payments.

 

It doesn't sound to me like you are advocating for any particular change in the Upwork platform. You're simply sharing your perspective.

 

I think it is interesting and worthwhile to hear your perspective on this topic.

We might not all agree on certain concepts, but I don't see that as a problem.

For survey research projects in the non-UW world, I always require an initial payment of 30-50% of the project fee. Those projects typically have timelines spanning 4-12 weeks and the bulk of the work usually happens at the back end, but I have to allocate substantial chunks of time in advance to complete them on time. If a client changes their mind or things get bogged down at their end, I can't afford to absorb all the opportunity costs associated with booking the project. Depending on the project, the schedule, and the need for subcontracted services, I also might include a cancellation clause.

 

On UW, upfront payment has been a deal-breaker more than once, for a client or for me, and I'm fine with it. In any case, I don't consider it a misuse of the platform. A milestone covers whatever the client and I agree that it covers, and that can certainly be "finalize research plan and schedule; reserve capacity for data collection, tabulation, analysis and reporting". 

 

If a project is small and/or flexible enough, I can cover my bases by setting up very rigorous understandings about target dates and consequences of missing them. Ultimately, it boils down to FLs and clients being able to vet each other and then collaborate professionally. That's where experience--and, I believe, a consultative approach to one's business which fits some categories better than others--pays off.

 

31cadf64
Community Member

I'm a freelancer on Upwork, a client on Upwork, AND have clients OUTSIDE of Upwork. I run my own business as a freelance ghostwriter and have my own website, so unlike some, I have choices. I choose to use Upwork sometimes to test the waters if I want to do something new, fun, or just stretch myself. So, coming at it from all angles. Here's my 2 cents (this is my opinion only, so relax).

Like any platform, there are scams, on both sides. I was nearly scammed on LinkedIn. But people who do what I do, and that are charging professional rates (I mean $5K - $10K or more), ALWAYS ask for an upfront deposit to begin the work because here's the other side of that argument. What if the freelancer does the work and the client doesn't pay? Also, of that $1K, the freelancer will only see about $800-$900) less another $1 if they use PayPal after Upwork fees. And yes, I know clients pay taxes on their side, too.

This is what freelancers are thinking and which is why there is an entire movement call #freelanceisn'tfree and a union for freelancers (Freelancer's Union) based in New York. Yes, I'm a member. Outside Upwork, I charge a 25% deposit fee (others I know charge 50% upfront, and even 100% upfront) to begin work, and then a monthly rate thereafter until the completion of the project with a detailed timeline in my contract so the client knows what to expect when and what their and my responsibilities are. Freelancers are not employees.

They are business owners (most don't realize it, though) because they have bills to pay just like everyone else and aren't counting on a monthly check that's the same every time with taxes et al taken out (not to mention the fees that Upwork takes out - soon a flat 10% + tax depending on their state or location).

 

Particularly with the layoffs across the country, many freelancers are well-educated professionals who should be paid for their experience, not the lowest rate. As a mentor once told me, "freelancers often think in 10s of dollars while good paying companies think in 10s of millions." While not everyone is a large company, let's leave the $10/hour stuff in the 80s (when things like rent and food cost less). Even McDonalds pays $15 to start and $17 for managers, probably more in some states. 

Your argument has merit but the real issue is that all freelancers, at least the ones I have used on a couple platforms, want to be paid in U.S. dollars, not their local currency so they can afford to appear as though they are lowballing the cost of a project.  Part of the reason there is so much discussion about this is that we all KNOW that it is not as expensive to live in Bangladesh as it is in Southern CA so we expect to pay less for the same quality - there is no supply chain here.  It is direct to consumer, no middlemen costs.  I know someone will take this, this way but this is not a racial statement - it is economic fact.  And even though we may have the same skills, a part of how much I get paid is based on my cost of living even though that is in reality probably low because of our governments. Tune in to your local, State or Federal discussions around raising the minimum wage and if that's a surprise to anyone, I'm sorry to be the bearer of bad news. If freelancers don't want to be perceived as scammers then don't advertise your services for one cost (bait) and then (switch) when you really don't want to or can't work for the amount you have posted.  The bait is meant to get someone interested but then the people hiring a freelancer feel mislead (scammed) when you switch  and they will either cancel the request or never return and that is worse for business.  You will be mentioned on Reddit or  within the platform on which you were hired, that you are a scammer.

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