Upwork is one of the most popular sites for freelancers to find positions of all sorts. Available and accessible across the world, it has gained popularity for its easy of use and its sheer size— three million jobs are posted annually to the tune of $1 billion.
Today, Upwork announced some changes with how it will charge commission from clients and freelancers. Upwork’s current model uses a one-size-fits-all approach to determine pricing; freelancers pay 10%, no matter the size or scope of a project. Starting this June, Upwork will transition to a sliding scale model.
This means that different projects will incur different commission structures. Small projects, for example, will incur higher fees on the freelancer’s part than more continuous, in-depth orders. Decreased commissions will accrue over the lifetime of a contract with a client, encouraging freelancers to continue to work for the same client over time.
The simple reason for this policy is that it is more expensive for Upwork to host and coordinate projects involving multiple freelancers; a single individual working on a bigger account allows for more streamlining.
Clients will begin to pay a 2.75% processing fee per transaction; previously, Upwork didn’t charge clients for posting or hiring. This fee will allow Upwork to “invest in the fast and secure payment processing you’ve come to rely on.”
For those who post and hire often, this processing fee may be replaced by a monthly flat fee of $25 for clients in many countries.
It is yet to be seen how these new fee structures will impact Upwork’s business model, but it’s safe to say that some will be happy (likely freelancers who frequently collaborate with a specific client) and some will not.
