Be aware of clients that want to pay fixed rate instead of per hour

[3d-master]

Recently I had a client that most probably unauthorizedly used someone's CC, money was in escrow, then it passed regular 5 days after milestone was approved and I got paid. We did several small projects under same contract which was divided in milestones. 2 weeks after I got first money from him, I got notice that user is under investigation, the contract is suspended and that my account is financially unlocked (I can't withdraw any of my money, although only a fraction was from that customer). Luckily, my account was unlocked fairly quickly but all transactions I had with that client were reversed. So I lost all I earned from him (and I felt bad from the start as I undercharged him! LOL).
I am kind of disappointed that although I am "freelancer plus" member and money was in escrow I had no protection at all, so be aware. If it was paid by the hour I guess I would be protected against it. From now on... fixed rate? Sure, but I'll charge you by the hour.

Good luck everyone!

[a_lipsey · Accepted solution]

Upwork cannot protect against a chargeback for fraud.

Why would Freelancer Plus membership have any protection attached to it? There's nothing on the membership page that suggests you get more protection if you buy the membership.

Hourly contracts have the most protection but none of the "protection" offered by Upwork is 100%. The best practice is to carefully vet clients.

[3d-master]

Technically speaking they could be insured against it. Anyway, that is not the point, I just wanted to divert attention to the fact that there are fraudulent "customers".
You have no idea who is on the other side, names are often fake, sometimes people just don't like leaving their names around. Altough, in recent year I had googled two (yes 2!) of my clients who were jailed (one for insurance fraud, one for murder!), and both of them used real names. Of course, experience with both of them was subpar, but you can't really choose if you want to put some bread on the table.

[roberty1y]

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Josip K wrote:

Technically speaking they could be insured against it. Anyway, that is not the point, I just wanted to divert attention to the fact that there are fraudulent "customers".
You have no idea who is on the other side, names are often fake, sometimes people just don't like leaving their names around. Altough, in recent year I had googled two (yes 2!) of my clients who were jailed (one for insurance fraud, one for murder!), and both of them used real names. Of course, experience with both of them was subpar, but you can't really choose if you want to put some bread on the table.

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Wow, Upwork just got a lot more interesting. I hope it wasn't a freelancer the guy murdered. 

[a_lipsey]

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Josip K wrote:

Technically speaking they could be insured against it. Anyway, that is not the point, I just wanted to divert attention to the fact that there are fraudulent "customers".
You have no idea who is on the other side, names are often fake, sometimes people just don't like leaving their names around. Altough, in recent year I had googled two (yes 2!) of my clients who were jailed (one for insurance fraud, one for murder!), and both of them used real names. Of course, experience with both of them was subpar, but you can't really choose if you want to put some bread on the table.

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That is why my recommendation is to carefully vet clients. Better to choose and miss out on a job that will be fraud and wasted time, versus turn it down and take on a job from a real client who does pay. It's also part of why I require a quick Zoom call with every client or I won't take the job. I know a lot of freelancers hate this idea, but you (general) either have to carefully vet or be okay with the amount of risk involved. It's fine to not vet as much as long as you are okay with the risk you take on. That's why many freelancers ONLY do hourly and use the time tracker religiously. 

[petra_r]

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Josip K wrote:

 If it was paid by the hour I guess I would be protected against it. From now on... fixed rate? Sure, but I'll charge you by the hour.

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Don't try and mix fixed rate and hourly- Most of the time that doesn't work well at all. Also, you are protected only if you use the tracker, have adequate work memos, high activity levels and all screenshots show you working on the client's project.

[3d-master]

Why don't you think that would work? If someone's budget is $200, in theory, you can assign $200 per hr and do one hour of tracked work, and then rest of it offline.
I never had problems with tracked hours, and I have over 1800 of hours logged here.

[petra_r]

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Josip K wrote:

I never had problems with tracked hours, and I have over 1800 of hours logged here.

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Well, you never had a chargeback before either.... We've all "never had a problem with..." until the day we do....

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Josip K wrote:

Why don't you think that would work? If someone's budget is $200, in theory, you can assign $200 per hr and do one hour of tracked work, and then rest of it offline.

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You wouldn't be covered. Upwork would pay you one hour at your profile rate or the rate you usually work at, whichever is lowest. Read the rules...

[AleksandarD]

Hi Josip,

I'm sorry to hear about what happened. I suggest referring to this support ticket for more information and in case you have any further questions, you can post them there directly so the team can continue assisting you. You can also check this help article for more information on the Fixed-Price Protection and this one for the Hourly one.

Thank you.