Upwork's 20% Fee is 100% Worth It

Last week, I talked about that niggly little unit, “the decibel”, but this week I want to focus more on the business side of things. I use Upwork.com to get all of my voiceover and audio production work. And I intend to for a long time. There’s one big drawback that people seem to have when it comes to Upwork and that’s what I want to address today: the 20% fee.

Let me clarify. Upwork charges both freelancers and clients for their services through the platform. Clients are charged a flat 2.75% on every payment, and freelancers like me are charged a fee on a sliding scale, based on how much work you’ve done for that client. That 2.75% client fee is annoying to the client, but on the whole it’s not dissimilar to PayPal’s fees for transferring money, which are 2.9% + 30 cents (at least here in the US).

But it’s the freelancer fee that inspires many a sharp intake of breath. If you’ve done less than $500 with a client, then the fee on each project is a whopping 20%. That number decreases to 10% once you cross the $500 threshold, and it goes down again, to 5%, but only when you hit 10 grand, which is a little beyond my imagination at the moment, but I’m sure it happens!

The vast majority of my contracts are under $500. Yes, 20% stings. And yes, I would still recommend Upwork to anyone who asks. The crux of it, for me, is two-fold:

1)      The sliding scale incentivizes freelancers to foster lasting relationships with their clients. Generally speaking, I do that anyway, but personally think it’s a good thing for Upwork to encourage a culture where clients and freelancers work collaboratively in the long term. It helps up the caliber of both freelancer AND clients.

2)      Doing my work through Upwork, I am protected ALL KINDS OF WAYS. Their system is structured so that payment goes into escrow before starting work, and there’s a dispute system should anything go awry. Being afraid of getting stiffed is just NOT something I have the time or energy to worry about. But it isn’t just financially that I’m protected…if I’m being harassed by a client, or if someone sends me something inappropriate, I am protected by Upwork.com. They don’t actually even recommend going outside their site, and doing so could get you banned. It’s a hallmark of the scammer to meet on Upwork and try and pull you off onto Google Hangouts, etc. Don’t do it!

Plus, you know…I set my fees. I take the 20% fee into account when I quote for a project. I’m always open to negotiation, so yes, on occasion, it just comes out of my pocket, but remember: I’m in control of my fee. So even though it feels like they’re taking something away from you…There is very good reason.

So here’s a question for you listening: Have you used Upwork? What are your thoughts on their fee structure and how would you change it if you could?