My question to oDesk was quite simple:
When I earn money from freelance work with oDesk, why does oDesk take funds from my Paypal account when I employ someone and not allow me to use the money I've already earned as a freelancer?
Their response was to direct me to the standard fees attributed to withdrawing money, yet:
From the outside looking in it would seem that it's a win win for oDesk and Paypal. If you're telling me that oDesk holds $$ from freelancer accounts and $$ from employers account in different financial institutions then that surely has to be investigated further?
Why should the user of this oDesk be penalised when using a service under the same banner, the same URL which allows seamless communication between the two accounts?
I'm pretty sure that isn't the case and we've got crossed wires, surely?
oDesk has quite clearly put in a simple one way system that raises revenue to the tune of $1 a pop... A stealth tax if you will. On face value it doesn't seem like a lot of cash but when you multiply that by hundreds of thousands of transactions it's quite clear what the game is and it's unfair.
I guess with this system you can squeeze that extra bit of revenue from a broader client base, even taxing those on lower incomes who couldn't afford a premium subscription.
Isn't the 10% enough?
Solved! Go to Solution.
I'm pretty sure that the $1 charge is a Paypal fee take by said company, which is actually a reasonable amount given that it applies to any amount to transfer to your PayPal account.
Of that I have no doubt (or maybe a little bit, you think that within a transaction oDesk will do it for free?) I'm pretty sure that oDesk don't use Paypal like the layperson, I would think that business is conducted around a boardroom table when you're talking millions of dollars.
It's not the $1 fee that's charged that i'm getting at, it's the fact that the money I've earned with oDesk cannot be used to employ oDesk freelancers. I have to deposit funds to oDesk when I have hundreds of dollars in my freelancer account waiting to be withdrawn.
You see what I mean?
There are certain practices that I think devalue their brand and limit the reach of freelancers which ultimatley affects the client: http://community.odesk.com/t5/Freelancers/A-warning-to-freelancers/m-p/73087#U73087
Thank you for sharing your feedback with us. Although it used to be possible to pay a freelancer with the money earned on oDesk, we are not able to offer this type of payment for legal reasons anymore.
Thank you for your understanding.
That sounds like an odd law, but i'm sure it makes sense if explained clearly.
Please can you elucidate so that I am able to understand the situation you/we find ourselves in?
At the moment I'm still no closer to a definite answer and the question is still unanswered sufficiently.
Disclaimer: Not a Lawyer
I believe this change came about when Escrow came about. The escrow system must have a verified payment method. Not all oDesk accounts are verified, therefore funds in their freelancer account are not verfied. I know this does not make a lot of sense. However I feel like for legal reasons they needed a verfied payment method (something that could hit your credit report, be personally liable for) in the case that your escrow got refunded. I can not attest to all the legal mumbo jumbo that would be involved but this makes sense to me that several of oDesk's fancy suit educated lawyers got together in a board room and said this was the only way they could be protected.
This is all assumption as it seems the change to being able to use your oDesk account to pay freelancers came with the escrow. It has been a long time since I used Elance, however I believe that they worked this way, having to withdraw and desposit to secure a contract with a freelancer, to fun the Escrow. One funny thing though, Elance does not charge you $1 to withdraw to paypal (limited amounts of times, I think it was 1x per week?) however it takes them a day to deposit the funds into Paypal, it is not instant like it is here.
If anyone has clearer information on if you can use your available funds in Elance to hire freelancers or not it may help clarify this. If they work the same way my assumptions will seem much more accurate. If however you can use Elance funds without depositing, then there is a big loophole as they are the same company.
That makes most sense, i've been trying to get a straight answer from oDesk for a while but I'm hit with the standard jargon each time.
I know it's not going to make a shred of difference but honesty is best, politicians can evade a direct question without any comeback but where's the harm in divulging the facts in this instance?
Thanks for your clarity.
One funny thing though, Elance does not charge you $1 to withdraw to paypal (limited amounts of times, I think it was 1x per week?) however it takes them a day to deposit the funds into Paypal, it is not instant like it is here.
No. Suprisingly, Elance deposit funds to PayPal within 3-5 hours. I've tried it several times.