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ploychat1
Community Member

Is Upwork fees 20% TOO high?

Anyone think that Upwork fees 20% TOO high?

 

I've just backed to find a job on Upwork and I'm shocked that Upwork fees have increased to 20%! I don't know why, but 2 years ago was just 8-10% (I'm not sure). I think 20% is too high and it is unfair for freelancers because you work same as usual but you need to pay for Upwork fees more than doubled. I think Upwork should remain that the income is from freelancers, they would find another website in one day if their deserved earnings are not worthy as they worked. 

 

 

 

116 REPLIES 116
emiguelina
Community Member

IMO, is not, and is just for the first $500.

  • 20% for the first $500 you bill a client across all contracts with them
  • 10% for total billings with a client between $500.01 and $10,000
  • 5% for total billings with a client that exceed $10,000

The more you bill a client the fee will decrease! But if you stay below, well it won't!

Another point you can increase your rate to adjust to the new fee.

Well but those who works on small projects ( Under $500) it's too much for them. So it should have been 10% for 1$-5000$ and 5 % for 5001$-Up..

 

Thank you.

I'm sorry to learn you feel this way, Tanvir Ahmad. Smaller contracts cost us more to serve than larger projects. The costs of acquiring clients, helping you connect with the right opportunities, and providing services like payment protection outweigh the fees currently charged for small projects. At the same time, larger, repeat projects incur fewer of these costs. To support our customers better, we’re increasing our fee on smaller projects and decreasing it when your relationships cross important thresholds. This provides our customers an incentive to continue building long and substantial relationships on Upwork, which we think will help ensure Upwork stays a vibrant marketplace now and in the future.


~ Avery
Upwork

"To support our customers better, we’re increasing our fee on smaller projects and decreasing it when your relationships cross important thresholds." How does this help anyone but the Upwork company themselves?

 

"Support our customers?" Do you mean, make more money for the Upwork company? It's not supporting anyone taking 20% fees. Take into account 20%+ taxes on that, that is a whopping 40%+.

 

I have had to move platforms because this fee is outrageously high. Also, chances of getting $500+ for a repeating client is VERY low, Upwork knows that or they wouldn't make such "sliding scales," so they can keep charging 20%.


Scott P wrote:

. Also, chances of getting $500+ for a repeating client is VERY low, Upwork knows that or they wouldn't make such "sliding scales," so they can keep charging 20%.


I've actually found it very easy to have the vast majority of my client relationships above that threshold, but it was something I had to actively focus on and manage.

 

Would it be nice it the first tier was lower? Sure. But I stopped wanting a pony a long time ago too.

That may be easy for a senior professional in the US/Europe charging $100+ per hour.

 

But move to Bangladesh, India, or the Philippines and charge a competitive $5-10/hr for data entry, graphic design or repetitive processes. Now you have to bill clients for 50 to 100 hours of work before you see a price break.

 

Disregard the $500 threshold. Would you be happy having UpWork take 20% of your earnings for the first 100 hours of your work with a client?   

 

If upwork wants to push small, high volume, one-off freelance jobs to Fiverr, this will policy helps do that.

petra_r
Community Member


Luke J wrote:

If upwork wants to push small, high volume, one-off freelance jobs to Fiverr, this will policy helps do that.


It's not the jobs that will go there, it's the freelancers. Which is not exactly an issue, considering that Upwork is literally drowning in that type of freelancer.

 

And you're right, Upwork is not fond of small contracts. They cost the most to administer.

Yes.


Scott P wrote:

"To support our customers better, we’re increasing our fee on smaller projects and decreasing it when your relationships cross important thresholds." How does this help anyone but the Upwork company themselves?

 

"Support our customers?" Do you mean, make more money for the Upwork company? It's not supporting anyone taking 20% fees. Take into account 20%+ taxes on that, that is a whopping 40%+.

 

I have had to move platforms because this fee is outrageously high. Also, chances of getting $500+ for a repeating client is VERY low, Upwork knows that or they wouldn't make such "sliding scales," so they can keep charging 20%.


You left? Your profile says that you just completed a job two days ago. And if you've landed dozens of clients and made over 3K in just a few months, what makes you so sure that you won't get any repeat business? Or have you made enough connections that you can afford to leave the platform now, to avoid paying any more fees?

I reach 10% with all my clients within a week. And I'm just grateful Upwork doesn't charge more. It's my understanding, anecdotally, that smaller contracts take more customer support to service, have more disputes, and, of course, they gross less money. So I find it very fair that they charge higher below $500 since the risk and cost to them is greater (from what I've seen, i don't know that the company has confirmed that).

20% - 10% and even 5% rate for an ONLINE freelancers plateform ?? Are we serious here ??... Even REAL headhunter businesses don't charge such rates.

Add to this : cost of 'connects' + tranfer fees + tax and you just break de legs of any small freelancer. In usual language we call that a steal. As freelancers we are not supposed to work for the Upwork stock exchange shareholders, but for our real customers. Plenty of other platforms use decent fees. Greedy people here, I won't use this plateform crazy high rates you work for nothing. 


Aurelien P wrote:

20% - 10% and even 5% rate for an ONLINE freelancers plateform ?? Are we serious here ??... Even REAL headhunter businesses don't charge such rates.

Add to this : cost of 'connects' + tranfer fees + tax and you just break de legs of any small freelancer. In usual language we call that a steal. As freelancers we are not supposed to work for the Upwork stock exchange shareholders, but for our real customers.  


I don't think of it as Upwork "stealing" money from me. I decide how much I want to charge for a project, and then I add 20%. It's impossible to run a business without having any expenses, and people who freelance online probably have fewer expenses than almost any other type of business. 

 

As for other headhunters not charging such high rates - I don't know about that, since it's been ages since I've looked for a permanent job, but it's been my experience while subcontracting for various creative agencies that they do take a hefty cut; usually 20-30%, but sometimes as high as 50%. Again, I just charge more to cover their fees, and in return, I get to work for some huge brand names - clients that I would never be able to get on my own. This is a marketing expense that I'm completely happy to pay.

 


Plenty of other platforms use decent fees. Greedy people here, I won't use this plateform crazy high rates you work for nothing. 

It costs a lot of money to advertise a service and bring in clients. If you can find a website that has as many clients as Upwork and charges lower fees, then obviously it would make sense to use it. 

lysis10
Community Member


Aurelien P wrote:

20% - 10% and even 5% rate for an ONLINE freelancers plateform ?? Are we serious here ??... Even REAL headhunter businesses don't charge such rates.

Add to this : cost of 'connects' + tranfer fees + tax and you just break de legs of any small freelancer. In usual language we call that a steal. As freelancers we are not supposed to work for the Upwork stock exchange shareholders, but for our real customers. Plenty of other platforms use decent fees. Greedy people here, I won't use this plateform crazy high rates you work for nothing. 


Do headhunters ever charge the employee/contractor? My experience is that they always charge the business and IME the cost is almost half of what I'm paid. I just calculated my last contract in corporate before I went freelance and the company was paying about 40% to the recruiting company. I guess you could say that the money could have gone into my pocket, but recruiters in my home town had all the good businesses so you can't get into one of the kush jobs if you don't work with a recruiter unless you know someone there. I was being paid market rates for my area and had full benefits too even as a contractor (it's a way to get around the contractor/employee rule...similar to Upwork's payroll thing).

leimurd
Community Member

Exactly. Just came back and found the 20% fee. RIDICULOUS!

Basically that means, Upwork want to ripoff and strip off small freelancer. I'm planning to try another platform for smaller scale freelancer. Anyone have any idea or better platform to suggest?

Upwork so far is a good platform for bigger budget freelancer. Hope they do well. 

I agree, having higher % for smaller clients just pushes those starting / joining the platform down. I had my first project which paid 250USD, but i ended up only receiving 190USD due to fees and tax, converted into euros I'm left with less than 150€ (obv they are not responsible for conversion, but maybe offer different currencies to make it easier?). On top of this, those who are less established find it harder to win contracts, thus apply for more which means BUYING credits to just to apply for a job! Definitely not a website to support junior freelancers

It's the small dollar value contracts that cost Upwork the most in terms of customer service, problems, payment issues and the like.  In my field, there have been various platforms that have come and gone and they all charged 40% or more, didn't guarantee payment, etc. I'll take 20% any time to not have to market my skills and not chase after payment,  No one is forced to use Upwork and if you don't like the fees, try other platforms.

I agree!

Would you please tell me what plateforms you have moved for?

Agree. I stopped doing work at Upwork for few years because of the 20% price hike. Used to enjoy doing small gigs here to cover daily expenses as part-time translator, but with the 20%... i can only get so little. But, glad to hear Upwork changed the fee to 10%. I just hope Upwork don't charge any extra hidden additional fee for any misc processing fee to cover up the remaining 10% (from the early 20% charge)

I think you all need to relook the fees.... 20% is insane considering you are literally just a medium. Your overhead costs to not justify a 20% fee, not when a much more robust platform like airbnb only takes 3% for essentially doing the same things... connecting buyers and sellers. 

re: "I think you all need to relook the fees.... 20% is insane considering you are literally just a medium. Your overhead costs to not justify a 20% fee, not when a much more robust platform like airbnb only takes 3% for essentially doing the same things... connecting buyers and sellers."

 

You are - of course - welcome to use any platform you like. You could use AirBnB instead of Upwork. Or you could use it in addition to Upwork. Or you could use something else entirely.

 

Using Upwork is 100% optional.

Do so if it makes sense to you and benefits you. Or don't.

 

Is 20% too high?

Maybe it IS too high. But isn't that a subjective opinion?

 

What If I told you about these two freelancers:

Patricia and Frank do the same kind of work, and have the same level of skill.

 

Patricia uses Upwork, which charges 20%. Last month Patricia earned $5000.

Frank uses OtherPlatform.com, which charges only 1% fees. Last month Frank earned $500.

 

The freelancer who was charged MUCH HIGHER fees earned much more money.

How do you exlpain that?

Do you think people at the same level should make the same amount of money?
Your example is absurd.
That doesn't mean you can make a lot of money with Upwork alone.

enajrosen
Community Member

Indeed, the fees are bloated. Talent agents take only ten percent, and thats for negotiating contracts, booking auditions, hand picking jobs, and giving career advice to their actors. Upwork is just a job listing sight with some helpful algorithms and a payment portal. I do the labor of hunting, discerning, negotiating, applying, paying Connects to apply. I can’t justify the 20% outside of my sense of desperation and this being the most active job posting site. I resent it. The bloated fee makes me feel pathetic. It makes me feel like my masters degree was useless, it makes me feel precarious, exploited. My acceptance of it highlights my desperation on a weekly basis. It feels like a Black Mirror episode. Welcome to the gig economy.

Yes
37c889a8
Community Member

Your so-called job placement specialists are horrible and have no tech experience. Not worth the time or money to clients. Your platform and freelancers are what we came for, not your help. Get rid of them all and reduce your prices, we can find our own talent. Support to date has done nothing to help me.

enajrosen
Community Member

But you don't DO anything. My voiceover agent DOES a lot, per contract, for me, and gets ten to fifteen percent. You are a bulletin board and youre taking 20. **edited for Community Guidelines** I'll speak freely, I'm done with Upwork. **edited for Community Guidelines** squeezing everything you can out of the desperate.

Your phrasing here may zero right in on the problem. "The desperate" are hardly a desirable customer base.

Does this threshold also apply to enterprise client service fees? As I understand, it remains at 10% regardless how long and how much you've already billed the client, am I right?


Rodelyn Ann B wrote:

Does this threshold also apply to enterprise client service fees? As I understand, it remains at 10% regardless how long and how much you've already billed the client, am I right?


Correct

You are right but freelancer who have less than 500 billing in month for them it's too high it should be not more than 10 %

Yes, I agree, Upwork fees are too high. It would be best if it is 5% on small earnings & 10% on huge earnings.

charles_kozierok
Community Member

This isn't going to change. Your best way to deal with it is to become a good freelancer and get steady, long-term clients. Once you pass $500 in earnings with a client, it drops to an entirely reasonable 10%.

I really don't see it as such a huge issue. Take into consideration the time and hassle I would have spent billing a client, following up for payment, etc. etc. etc. and that percentage charged starts looking good. Besides, longer projects are my bread and butter. Small projects that I take on from time to time provide the jam.

Should I have to exceed $500 in one contract or just with that client in total since beginning ? Thanks

petra_r
Community Member


Rohan S wrote:

Should I have to exceed $500 in one contract or just with that client in total since beginning ? Thanks


Just with that client, Rohan.

It does not matter whether it's on one contract or 10 (or whatever.)

 

I started shooting for longer term client relationships years ago (before the 20% even came in) and think of the original 20% as a $ 50 "finders fee" which is pretty irrelevant when it comes to client relationships worth many thousands, and it's oh-so-sweet when it drops to 5%!

 

My total earnings are600+ and i still have 20% fee. Why?
petra_r
Community Member


Eni M wrote:
My total earnings are600+ and i still have 20% fee. Why?

Because the fee tiers are per client. Not overall. 

Once you have been paid over $500 by any one particular client, your fee for contracts with that (!) client (only) drops to 10%

katemartinvo
Community Member

It is wayyy too high. With the fees this high, it is hard to say if I would stay or go when another freelancer site inevitably arrives and shows potential. It is terribly high. An agent only takes 10%. 


Kate M wrote:

It is wayyy too high. With the fees this high, it is hard to say if I would stay or go when another freelancer site inevitably arrives and shows potential. It is terribly high. An agent only takes 10%. 


There are already a number of other options for sourcing work, clearly none of them 'show potential' as you are still here. This suggests to me, that in order for a site to provide the kind of services that 'show potential'  and compete with Upwork, they would likely need to charge a higher rate than the others (20%).

 

The majority of my work has been in the 'under $500' fold, but i am working to try and build a base of clients that are in the >$500 / 10% range. Its better for upwork and its better for me. WIN WIN!

 

 

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