Possible as a freelancer to hire another freelancer?

[takennelly]

Ok, so here's the scenario.  I'm a freelancer (aka not an agency) that bills $85/hour.  From time to time, my clients need a service that I can't provide, however, I have a good reliable contact (also an Upwork freelancer) that bills at $20/hour (and is happy at that rate).  Let's call him Dev.  I'd like to be able to tell my clients that I can provide the service under my billing scheme (aka $85/hour or whatever my negotiated rate ends up being), raise Dev's rate to $40/hour under that billing, and effectively split the hours so that for every hour he does his work, he earns $40/hour and I earn the remainder.  I think this could be a really mutually beneficial idea, but I haven't proposed it because I'm not sure how to do that in Upwork.  Is this possible?  Do I need to be an agency and bring him in?  If that's the case, would he still have the flexibility to pursue his own projects (as I would prefer and, I'm sure, he would too)?  Just to be clear - for the sake of this scenario I'm not interested in discussing Upwork commissions, VAT, etc.  Want to know first if the overarching idea is even plausible,

Thanks!

[petra_r · Accepted solution]

You are not allowed to farm out hourly contracts, not even with your client's knowledge and consent.

You'd have to create an agency, add Dev to the agency, and get your client to hire Dev through the agency at $ 40 an hour,  the agency gets paid. (Dev, of course, sees that you are pimping him out at a 100% mark-up and the client can see that he is getting a $ 20 an hour freelancer for $ 40 an hour. Only you know if you think that is a way to build trusting business relationships...)

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Trent K wrote:

 I think this could be a really mutually beneficial idea, !

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It doesn't. It sounds like exploiting both sides (Dev and the client)

[takennelly]

Thanks for the answer, Petra.  That's a bit what I was expecting to see.  

As to the exploitation - that seems like a pretty harsh statement.  I'm bringing the client my expertise and the connections that come with it.  For Dev, he'd be getting more and so would I.  How is this different, in your mind, than any other independent contractor work-for-hire arrangement?

[florydev]

Well you came to a forum with a bunch of independently-minded freelancers and tell us about someone whose work is either worth $85.00/hr that you are going to take +100% markup on or someone whose work is worth $20.00 that you are going to charge +400% markup for.  The explotation comes in where one of these people doesn't realize their value correctly, that you do, and instead of helping them find that value, you are looking to make profit.  There is nothing wrong with profit, there is no doubt that this person benefits making 100% more than they were before, but, I believe, is still exploitive.  If I were you, I would expect to get some harsh statements.

You have effectively made this person an employee.  If they want to walk into that arrangement, that's their choice, but me, I would be like wait a minute what is this guy doing that I can't do.  In fact I asked this very question and here I am. 

So this person should raise their rate to $85.00 and go out and plunder.  And if you are even marginally tempted to say they can't do that...then you must believe they are not worth that and I would then ask you why you believe that?  And if you believe that then you are not bringing value to your customer and how can you expect to do anything but fail doing that?

But, do what you want, not going to be rooting for you though.

[takennelly]

Hi, Mark,

Thanks so much for your answer.  I can understand this perspective.  I really was coming from the idea that everybody was getting more, but I can see what you're saying.  To be clear, I'm not interested in doing anything unethical or against community standards.  I'm really just thinking about the best ways to scale.  Sounds like this isn't it.  🙂