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dparent
Community Member

Why is Upwork encouraging freelancers to gouge the people hiring them?

Ive used upwork for several years and spent tens of thousands hiring freelancers.  Ive always been a very supportive user and fulfilled my end of the bargain every time.  Im decent to freelancers, give good ratings when warranted and give clear insructions on what to do.  So why is Upwork instructing freelancers to gouge me?

 

When I set out to hire some one I search very carefully - I decide what skills I need and what range of pay is in the budget.  Then I search, review skills and ratings, and interview candidates.  I spend lots of time doing this.  Then I narrow my search down to the right person and offer them the job.  They then raise their rate that was posted.  This NEVER happened until a few months ago.  Now it happens EVERY job.  In one case the rate the freelancer "offered" wanted was 400% over their profile rate.  More typical is 30%-50% jump over their profile rate.  This is preposterous. I even asked this particular freelancer why she did that and she basically spilled the beans on Upwork.  She stated that when my offer to hire came in, Upwork encouraged her to raise her rate for my offer (the profile rate stayed the same)!  Seriously?  So I make an offer in good faith and you use my goodwill against me?  Also, very strangely, after I made an offer, I was no longer able to see the candidate's original profile rate - is it being intentionally obscured to prevent employers from seeing the original rate?  This is really a terrible practice.

 

The freelancer should post a rate they are comfortable with and feel they are worth and stick to it for the next person who hires them.  If they feel they are worth more, they should raise their profile rate.  As jobs progress and either the freelancer becomes busier, their skills improve, or the job demands more, the rate can and should be re-negotiated between the two parties.  But Upwork's practice of screwing the employer makes for bad blood between employers and employees and undermines the very purpose of Upwork - a marketplace where people can come together.  One of the most important elements of a market is visibility of pricing.  When you start messing with that, you undermine the very value Upwork brings.

19 REPLIES 19
lysis10
Community Member

They have this strange "suggested rate" thing when you bid. I think it only shows on our screen if our profile rate is lower than whatever they've calculated. I would really like to know how it's calculated, because it's suggested some crazy high rates for some jobs I reply to. Like, I'm all for not leaving money on the table, but I think sometimes the calculations are too high. 

 

I think they are using some outside API from what I can tell but well... I think they doinitrong.

kochubei_valeria
Community Member

Hi Doug,

 

In some cases freelancers will see a Rate Tip when creating a proposal for a job (not when accepting an offer). We have provided more information about the feature in this announcement. The amount is calculated based on the following data:

  • Rates paid on similar jobs in this specific category and subcategory
  • The freelancer experience level this client is looking to hire
  • The freelancer's rates and experience from all of their work on Upwork
  • Supply and demand in this category and subcategory

This is optional and freelancers are free to bid with whatever rate they see fit and further negotiate with the client.

~ Valeria
Upwork
prestonhunter
Community Member

Doug:

Thank you for your thoughtful account of your first-hand experience with this phenomena.

 

Upwork refers to its new feature as "Rate Tip", and it is no doubt responsible for what you have encountered.

 

You may read more about it here:

New Rate Tip Feature

 

Screen Shot 2019-01-03 at 11.10.25 AM.png

 

Personally, as a freelancer, my rate is my rate, and I just ignore the "rate tip" feature. But apparently many freelancers are NOT ignoring it.

 

I do not believe Upwork would use the word "gouging" to refer to what freelancers do when to change their rates this way. I think Upwork would use other terminology, such as "Why is Upwork encouraging freelancers to charge hourly rates higher than their posted profile rate the people are hiring them?"

 

But regardless of what phrase is used to describe this, the practice is the same and your assessment is accurate.

 

If I may offer a recommendation, I would say that paying people their profile-posted rate is very fair and reasonable, and that if a freelancer offers you a higher rate, you can decline their suggestion and simply say something like: "Don't worry about that. Can we agree to $XX.00 per hour, the rate on your profile page?"

wlyonsatl
Community Member

Doug,

 

What you are describing is unethical, in my opinion, a kind of bait-and-switch that I am not surprised is unacceptable to you.

 

As a freelancer I would only change my initial proposed rate on agreement with a client. Many clients post jobs in my specialty (business plans and complex financial projections) without really knowing what they are asking for. As a result, they don't really have any clue what their project will/should cost. (Offering $250 for a project that will take me 30 hours to complete means a client either doesn't know or care how much time and expertise their project requires, or they don't care about the quality of what they will receive. Another freelancer may be out their that better fits their needs than I do.)

 

When looking for new projects or responding to client request for a proposal, I usually ignore very low-priced projects and projects that the client has really provided no detail on in their Upwork posting. But I will sometimes bid on a low-priced project at the client's stated level and make it clear my proposed pricing is just a placeholder until we talk and I better understand exactly what will be required. I'd say only about 10%-15% of these prospective clients even reply to my proposals, but these turn out to be good clients. 

 

I have no idea where Upwork's pricing algorithm gets its "suggested" rate on various jobs, but I always ignore it. It's sometimes a large multiple of my standard rate for no apparent reason (!); I don't remember any example where it was lower than my standard rate. Of course, the more money freelancers charge the more money Upwork makes on its fees, but that's how free markets work.

 

Like the Job Success Score, Upwork has left the calculation of the "suggested" bid rate to some sort of blackbox algorithm that really isn't up to the task. And, also like the JSS, Upwork has provided no justification why it is useful.

 

As a client, what minimum JSS do you require before you will consider hiring a new freelancer?

gilbert-phyllis
Community Member

I don't think the Rate Tip is encouraging FLs to "gouge" clients. I see it as another poorly conceived attempt by UW to help FLs charge more so everybody earns more. But so many variables are in play that I don't see how an automated tip could possibly supplant the FL's judgment, and among experienced professionals, I'm sure it doesn't. I bid what a project is worth to me, based on my understanding of the scope of work. If I come in a lot higher than the client expects and my proposal doesn't compel them to rethink, then I never hear from them. That's OK.

 

To what others have said, I would add that my profile rate is intended to let clients know which ballpark I play in. Sometimes my proposed fee (fixed or hourly) is higher, sometimes a bit lower, depending on the specifics of a project. People who do more production-oriented work can probably stick to a set rate more consistently. My projects are all custom and the scope and depth of my engagement can be all over the map.

Be sure that the reverse happens to freelancers all the time, too, just perhaps without assistance on the hiring page.  I can't count how many times I've submitted detailed proposals with my rate included, done a sample for the job, and been turned down because I wouldn't slash my rate in half.  It's a dirty trick to try and lure people in on the premise of time spent.

 

To that end, as Phyllis said, I use my profile rate as a general base.  There is a reason we are able to adjust our bids for hourly projects, and aren't confined to just bidding at our profile rate.


@Phyllis G wrote:

I don't think the Rate Tip is encouraging FLs to "gouge" clients. I see it as another poorly conceived attempt by UW to help FLs


@ @Phyllis
Do you suppose there's a special department devoted to formulating Bad Ideas? Or do they just arise spontaneously due to holes in the AI? 

mtngigi
Community Member


@Doug P wrote:

Ive used upwork for several years and spent tens of thousands hiring freelancers.  Ive always been a very supportive user and fulfilled my end of the bargain every time.  Im decent to freelancers, give good ratings when warranted and give clear insructions on what to do.  So why is Upwork instructing freelancers to gouge me?

 

When I set out to hire some one I search very carefully - I decide what skills I need and what range of pay is in the budget.  Then I search, review skills and ratings, and interview candidates.  I spend lots of time doing this.  Then I narrow my search down to the right person and offer them the job.  They then raise their rate that was posted.  This NEVER happened until a few months ago.  Now it happens EVERY job.  In one case the rate the freelancer "offered" wanted was 400% over their profile rate.  More typical is 30%-50% jump over their profile rate.  This is preposterous. I even asked this particular freelancer why she did that and she basically spilled the beans on Upwork.  She stated that when my offer to hire came in, Upwork encouraged her to raise her rate for my offer (the profile rate stayed the same)!  Seriously?  So I make an offer in good faith and you use my goodwill against me?  Also, very strangely, after I made an offer, I was no longer able to see the candidate's original profile rate - is it being intentionally obscured to prevent employers from seeing the original rate?  This is really a terrible practice.

 

The freelancer should post a rate they are comfortable with and feel they are worth and stick to it for the next person who hires them.  If they feel they are worth more, they should raise their profile rate.  As jobs progress and either the freelancer becomes busier, their skills improve, or the job demands more, the rate can and should be re-negotiated between the two parties.  But Upwork's practice of screwing the employer makes for bad blood between employers and employees and undermines the very purpose of Upwork - a marketplace where people can come together.  One of the most important elements of a market is visibility of pricing.  When you start messing with that, you undermine the very value Upwork brings.

 

Oh goodie ... more insight into the lengths Upwork will go to p__s clients off. Can't wait for the next revelation.


 

Virginia,

 

There is no reason for clients to think Upwork expects or encourages freelancers to post one (low) rate when first applying for a job and then double or triple their rate requirement after the client says they want to hire them.

 

The "recommended" rate is just another indecipherable black box calculation that at least some freelancers ignore. I know I do.

I think this represents a real blind spot for those of us who are regular Forum participants.

 

We were aware of the rate tip feature. But we largely ignored it. We assumed other freelancers were doing the same.

 

The original poster's hiring practices put him in contact with a substantial sub-group within Upwork's freelancers who DO NOT ignore it. And, in fact, use the rate tip feature in a way that seems unethical or irresponsible to the original poster. 

 

I think the "blame" for this can be shared between Upwork and the freelancers who are using this tool without much thought.

 

Fortunately there is an easy solution for the client, which is to simply reject the higher rates proposed based on the rate tip.

Two points: 

 

A few posters in this thread have mentioned fixed-price contracts. It is okay to discuss that here, but that really has nothing to do with the original poster's issue. Which is strictly about hourly rates.

 

Second: I think the rate tip feature has a place. Which is to suggest to freelancers that they might raise their posted rate. I don't think it should be used to spring a new, higher rate on a client who has already received your proposal at a lower rate. It is for future consideration.


@Preston H wrote:

 

 

The original poster's hiring practices put him in contact with a substantial sub-group within Upwork's freelancers who DO NOT ignore it. And, in fact, use the rate tip feature in a way that seems unethical or irresponsible to the original poster. 

 

I think the "blame" for this can be shared between Upwork and the freelancers who are using this tool without much thought.

 


Excellent point. There's also a substantial sub-group of freelancers who don't understand how the platform works, and for all we know, they may think they're required to bid the rate tip suggested rate.

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

I remember when this "rate tip" first debuted and for a second or two I wondered if I had been making a rate mistake. The language they use around this does give off the impression that it based on good behind the scenes science at UW. However, I quickly realized that it doesn't reflect the realities of UW but, at least in my area, it does reflect rates I would get with local clients outside of UW. I've been on this platform enough to know that the rate tip isn't a realistic reflection of the majority of clients here. I don't even process the rate tip now and I had forgotten all about it until this post. I can absolutely believe there are many on this platform that would take the tip as gospel. The way the language is written around the amount coupled with an inexperienced freelancer (note, I said inexperienced and not dumb) could easily lead to the higher rate offered.  I don't agree with those freelancers who offer a rate vastly different than their profile unless they are in a business where the nature of the work would legitimately impact the hourly rate offered. I also don't agree with those freelancers who can set a lower profile rate as a bait and switch to attract clients. Of course that is separate of this issue but can also account for some of the much higher rate increases on proposals. 

 

In the end you have freelancers who - like all sellers - would like to get as much as is reasonable for their services. You couple this with the very entity that knows EXACTLY what clients are paying for these services, advising you to up your rate. What do you think is going to happen? 

sam-sly
Community Member


@Doug P wrote:

 

When I set out to hire some one I search very carefully - I decide what skills I need and what range of pay is in the budget.  Then I search, review skills and ratings, and interview candidates.  I spend lots of time doing this.  Then I narrow my search down to the right person and offer them the job.  They then raise their rate that was posted.  This NEVER happened until a few months ago.  Now it happens EVERY job.  In one case the rate the freelancer "offered" wanted was 400% over their profile rate.   

The freelancer should post a rate they are comfortable with and feel they are worth and stick to it for the next person who hires them.  If they feel they are worth more, they should raise their profile rate.  As jobs progress and either the freelancer becomes busier, their skills improve, or the job demands more, the rate can and should be re-negotiated between the two parties.  


 

From a freelancer point of view, I have a couple of comments, one isn't directly related but it may be a factor...

 

- I am personally curious how Upwork comes up with the suggested rate because when I see it it is usually 30-50% over my listed rate. This "feature" has been around at least a couple of years. When I first joined 2 1/2 years ago I would follow the advice because I was new and unsure of pricing. Were some of these freelancers new to the platform? When I was new, I saw the suggestions all the time, lately, I only see those suggestions occasionally.  I've raised my rates a few times over the past two years and that message is less common now.

 

- Also, it sounds like you are sending an offer rather than an invitation to interview? I know some freelancers see this as risky to accept since they can't see the client's prior reviews or history if there isn't a public job associated with the offer. I recently declined an offer for this very reason. In my case, the client didn't have a job listing and didn't actually describe the scope of the work in the offer either. I reached out to Upwork support to see if they would let me see the clients previous publicly posted reviews from freelancers. The rep said they couldn't show me that information to protect the client's privacy since he sent an offer.  The offer was hourly, but I still need to know what kind of work is involved! It sounds like your offers are clearer than this client's offer.


@Samantha S wrote:

I reached out to Upwork support to see if they would let me see the clients previous publicly posted reviews from freelancers. The rep said they couldn't show me that information to protect the client's privacy since he sent an offer.


Not the point of the original post, but I have experienced something similar (see my posts on this thread: https://community.upwork.com/t5/Announcements/Client-Info-Included-in-Direct-Offers/m-p/483289).

 

They are supposed to refer you to -- if it's available -- a public job post of the client so that you can see their past reviews. There are good CS reps who have done this for me and a few other freelancers, and yours should have provided you with that info. Try a different CS rep, because many of them have no idea what they are supposed to do. 

Doug,  the sad reality is that freelancers on Upwork run the gamut between truly talented professional people from around the world ... and the least knowledgeable and often time grandiose cheaters from around the world.

 

There is inadequate screening of Freelancer qualifications and honesty/ethical behavior. As many of us will confirm, we are constantly reporting these people to management.  For understandable  reasons we are not informed of the results - but we also check on the status of profiles we report.  Too often management does nothing - at least not of consequence.

 

I am firmly of the conviction that buyer and short-listed freelancers need to discuss the job parameters and expectations before agreeing to work together. 

 

If your jobs are mostly one-off jobs - example: translate 300 words from French to English; subject matter includes "medical terminology" or "translate 300 words from French to English; subject matter 5-10 year old storybook" the costs will vary.  Medical terminology is a far cry from a kid-lit blurb. This is true - be it on a per word basis or on an hourly one.  The same holds true for every skill set.

 

Quotes given really do depend on the quality, depth, research required, etc. for any job. 

 

I am not excusing the FL behavior you've encountered; I am trying to explain why it sometimes happens.

Is this "rate tip" feature still in place or in test mode for only selected freelancers? I saw the other discussion and that was back in 2015. After so many years I can't believe they are still testing it! I have never seen this rate tip while applying to a job.


@Sergio S wrote:

Is this "rate tip" feature still in place or in test mode for only selected freelancers? I saw the other discussion and that was back in 2015. After so many years I can't believe they are still testing it! I have never seen this rate tip while applying to a job.


 

I still see it, but not all the time. I don't know what sorts of jobs you apply to, but most of the jobs on your profile are fixed-price jobs, so maybe that has something to do with why you haven't seen it yet.

gerrys
Community Member

I'll charge "less" if the job is "easy".

 

But if discussions prove that things are more complicated than the original post suggested, then of course, a new rate may be warranted.

 

Conversely, a "hard" job may prove to be easy once the requirements are better understood.

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