Table of Contents
What is Upwork
In 2013, two popular online freelance platforms, Elance and oDesk, merged to form Elance-oDesk, later rebranded as Upwork in 2015. According to the company, Upwork Global Inc is “the premier freelancing website for top companies to hire and work with the world’s most talented independent professionals”.
The company has approximately 145.4 thousand active clients spending at least $5,000 per year. In 2020, around 1,500 freelancers had worked on Upwork projects.
All you have to do is register on this global freelancing platform, create a job posting, and then sit back as a slew of candidates jump at the prospect of working on your project. You choose the best or most experienced freelancer, and your project is good to go.
While Upwork has played a big role in helping companies and individuals find independent remote workers, the sheer size of freelancers bidding for a project makes it very difficult to separate the wheat from the chaff. In other words, if you aren’t too careful, you may end up hiring an incompetent candidate for your project.
As a freelancer, finding good paying projects on Upwork can be an uphill task. You need to outbid talented competition on the freelancing site and contest with freelancers who are willing to charge very low rates.
How Much Does Upwork Charge?
Upwork Global Inc has changed its fee structure and now charges both the client creating the job posting and the freelancer getting the gig.
For clients hiring any new freelancer, the company charges a fee of 5% per payment transaction to all clients (or 3% for eligible U.S. clients who pay via ACH).
This Upwork fee is calculated as a percentage on top of the payment you make to freelancers. For example, if the Upwork client makes a $1,000 payment for a project, the platform will charge an additional $50 processing fee.
Earlier, this platform did not charge clients any fee.
Upwork charges VAT to freelancers and agencies in certain countries unless specific exemption requirements are met. The freelancing platform collects this tax and pays it to the appropriate government agency.
This tax rate varies by country, which means your tax percentage will depend on your country’s VAT rate. For example, the VAT rate for the United Kingdom and Germany is 20% and 19%, respectively.
Note: The above Upwork fee doesn’t apply to clients who’ve signed a contract for Upwork Enterprise services or have another agreement that provides for different terms.
How Do I Make Payments on Upwork?
When you hire a new freelancer on this platform, there are two types of payment – for fixed price contracts and hourly contract gigs.
For fixed price contracts, employers need to make deposits in an escrow account. The money is released to the freelancer once the job is complete. Or it may be released when the freelancer reaches specific milestones in the project, as discussed with the client.
On hourly contract jobs, employers are billed every Monday for the previous week’s hours based on the freelancers’ work diary that records the number of hours put in a job with work-in-progress screenshots.
You can make payments through credit card, debit card, bank accounts (US clients only), PayPal, Payoneer (outside the U.S.), and M-Pesa (Kenya only). These payment accounts need to be verified by the Upwork platform.
For fixed price gigs, your client has 14 days to review and approve the milestone or request changes. Once they approve, the funds in escrow will be released to you. However, if your client takes no action for 14 days, the funds are automatically released to you.
How Can I Find Good Freelancers on Upwork?
Finding and hiring good talent on any freelance platform is a time-consuming job. It is no different for Upwork. Companies and entrepreneurs looking for freelancers on Upwork usually complain that good talent is hard to come by. There are too many mediocre applicants, and an Upwork scam can catch you unawares.
You can also give Upwork Plus (formerly Upwork Pro) a chance. It’s a paid service from Upwork. The company says it helps busy hiring managers find, engage, and hire a talented freelancer from a group of handpicked, pre-vetted professionals.
Under this, the Upwork freelancer goes through a series of tests and interviews to qualify on technical skill as well as behavioral aspects that evaluates communication skills, teamwork, and professionalism to determine if they are fit for a role.
As a client, when you sign up for Upwork Plus, you get an account manager who works with you to understand your job requirements, including specific technical expertise, budget, etc.
The Upwork account manager helps you speed up the hiring process by assisting you with your job post and highlighting available freelancers and agencies who may be a good fit for your project. You can then sort through this selective list of Upwork freelancers, interview them, and hire the best candidate.
How to Get a Great Job on Upwork?
While we all know that when applying for a job, you need to write a top-notch proposal that attracts a client, there are a few tricks that could seal the deal for you on this platform:
Most Upwork proposals will need you to answer one or more ‘additional questions’ after you write your Cover Letter. Don’t take these questions lightly, and don’t treat them as an afterthought. They are the first thing the client gets to see when he receives your proposal. The cover letter comes last.
Write a customized proposal and cover letter that addresses the points made by the client. Don’t be generic. You can be the least experienced freelancer for a job and an expensive bidder, but if you take the time to understand the clients’ needs and communicate that clearly in your proposal, you’ll win the gig.
Don’t forget to look the part of a professional on your Upwork profile. There is more to a proposal than just the words you write. Upload a good, professional-looking picture of yourself. Use sites like Photofeeler to know how competent and influential you look. Even though it’s not mandatory to upload a picture on your Upwork profile, it does make a difference.
How to Complete a Project Successfully?
Clear communication and effective team collaboration is the answer to most problems that crop up in a freelancing project. Upwork allows collaboration between client and freelancer through its desktop app for successful project management. Everyone can use it to send messages.
However, Upwork in the past has penalized clients for ‘too much’ messaging. So, if a freelancer has too many questions, just hop on a voice call or video chat to hold a detailed conversation. Make a note in the Upwork messenger that you’re taking the conversation offline.
Any change in project deadline, details or payment when discussed and decided offline needs to be mentioned in Upwork messenger. Write a line or two putting the main points across.
Set a schedule for regular updates from the freelancer. You can then quality check and give feedback to the freelancer if improvements are needed while the project is midway rather than after it has been completed. This reduces delays in final delivery.
All details of freelancing project deliverables, deadlines, payment, files, etc. must be communicated through Upwork. This is essential for dispute resolution.
How do Upwork Reviews Work?
A 14-day feedback period opens at the end of the project when both the client and freelancer can leave each other a review. The review isn’t visible till both the client and freelancer have posted their review or the 14-day feedback period ends.
There are a few ways to change how your Upwork reviews appear on the platform. Within 28 days of the end of the contract, you can post a follow-up comment to a review about you that will show up on your public profile. You can also work directly with your client to request feedback changes and revise the Upwork reviews.
If you feel the review violates Upwork’s terms of service and you’d like to dispute a review, you can get in touch with Upwork’s customer support team.
Despite all precautions, sometimes disputes arise. Some common sources of dispute on Upwork include a freelancer billing you for more hours than necessary to complete the task or submitting subpar quality of freelance work.
With the rise of the freelancer economy, many companies are finding it profitable to hire through online platforms. The talent pool of freelancers and remote workers on these platforms is bigger and also gives you a wider geographic reach. Moreover, you save on the additional costs associated with hiring an on-site worker like office space, workstations, insurance, etc.
With a freelance marketplace like Upwork expanding and improving its services to allow easy and efficient collaboration between a client and any talented freelancer, there hasn’t been a better time to source top performers for your projects online.