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Upwork’s Nickel-and-Dime Fees: A Racket Ruining Freelancing

~ by Samantha W

As a long-time freelancer on Upwork, I’ve witnessed the platform’s steady descent into a nickel-and-diming racket that bleeds freelancers dry. What was once a viable 10% flat-fee marketplace has become an exploitative scheme with frequently changing fee structures designed to extract maximum revenue at every turn, while devaluing the very workforce it claims to empower.

Fee Frenzy: How Much Is Too Much?

The service fees have morphed repeatedly over the years — originally a flat 10% cut, then increased to a staggering 20% on the first $1,000 earned from each client, followed by 10% thereafter. The constant overhauls make it really confusing to track Upwork’s pricing.

But the fees don’t stop at the service cut. The “Connects” system charges freelancers just to apply for jobs — with larger projects over $1,000 typically requiring 12–16 connects ($1.80-$2.40) per proposal based on Upwork’s pricing of $1.50 for 10 connects up to $45 for 300 connects. For freelancers constantly bidding, these application fees quickly compound.

Simply having an “Available” badge showing your online status currently costs a steep 7 connects ($1.05) per week. In my case, my Available badge is turned off yet Upwork still deducts 1 connect per day from my balance (querying this with Upwork Support is a whole other story).

I also discovered that despite paying the availability badge, my account was set to private. This unilateral decision, tantamount to theft, was allegedly made due to an oversupply of freelancers on the platform. It’s a blatant betrayal of trust and a flagrant disregard for the rights of freelancers. Do yourself a favour and ask a friend to search for you on Upwork. If they can’t find you, your account has been set to private.

The Personal Cost of Upwork’s Avarice

From September 2023 to March 2024, despite religiously paying membership fees totalling over $200, I didn’t land a single contract. However, to bolster my chances of securing contracts, I typically purchase an additional 100 connects, amounting to approximately $15.00.

Furthermore, the cost of each application, averaging around 15 per month, quickly adds up. With larger projects demanding up to 16 connects per proposal (I just found one with a base rate of 18 connects — so $2.70 to apply for that one), the fees range from around $1.20 to $2.40 each time. Occasionally, I’ve even invested up to 50 connects for a single application, particularly when exploring the bidding option — this means that, that one application cost me $7.50. Your connects are returned if your proposal is not viewed but if it is (and the client doesn’t need to do anything but look at it) Upwork retains the connects. The expense of maintaining an “Available” badge to signal online availability further adds to the bill.

In summary, before even considering the service fees that would be incurred upon securing a job, my average monthly expenditure on Upwork amounts to approximately $69.80. These costs, coupled with the opaque and ever-changing fee structures, are indicative of a platform that prioritises profits over the welfare of freelancers.

Milking a Captive Workforce

This multi-layered nickel-and-dime approach points to a disturbing trend — Upwork is milking as much as possible from a captive workforce struggling amidst a perfect storm. The rise of remote work and COVID-driven layoffs has saturated the platform with freelancers desperate for any gig. When pleading for relief, responses from Upwork’s support are often dismissively blasé: “Work hard on proposals” they parrot, ignoring the broader systemic issues.

I received a response from Upwork support advising me to negotiate with clients, as if it’s reasonable to suggest that seasoned professionals should lower their prices or haggle over services they’re already proficient in providing. Their exact words were to ‘provide your client with the skills and capabilities that you are capable of completing the job’, which is utterly baffling. I mean, what does this even mean? Are they implying that freelancers typically offer services they can’t provide? Or is it simply their patronising way of ignoring our concerns and making the freelancer the problem. Not the system.

Furthermore, their suggestion to turn on the availability badge rings hollow, given that my account was arbitrarily set to private despite having the badge activated. It’s a glaring example of Upwork’s incompetence and lack of consideration for its users’ concerns.

The Volume Trap

Indeed, well-crafted proposals are increasingly futile against Upwork’s volume-over-value approach. One client interviewing freelancers reported receiving over 150 applicants for a single role — a deluge that disincentivises careful vetting.

Exacerbating this dynamic is Upwork’s new-ish “Promoted” bidding gambit mentioned above. Freelancers can now spend “Connects” to boost their visibility, creating a pay-to-play bidding war. While touted as an “additional service”, it disadvantages those unwilling or unable to splurge funds simply to get noticed amidst the digital clamour. For freelancers in developing nations grappling with unfavourable exchange rates, it compounds an already lopsided playing field.

What emerges is a grim picture of exploitative practices — opportunistic price-gouging on both sides of the marketplace, flooded with an oversupply of freelancers treated as commodities in a race to the bottom.

At its core, Upwork has strayed from its founding principle of empowering skilled independent workers. The platform’s fee structures, auction systems, and sheer volume approach demonstrate a misalignment with the needs of its very constituents.

Freelancers are not exponentially scaling businesses — they are individuals monetizing their skills and time. Excessive fees that increase yearly syphon away hard-earned income, while making it harder to selectively filter clients and projects. Visibility-boosting “promotions” create an uneven playing field rigged towards those with deepest pockets.

For clients, being inundated with hundreds of proposals is the opposite of efficient hiring. Upwork’s facilitation fees also add up, potentially nudging firms to seek cost-savings via offshored bargain-basement labour over domestic quality.

A Fairer Future for Freelancing

Both sides lose when a platform designed to unleash entrepreneurial vigour becomes restrictive golden shackles. Sustainable freelancing ecosystems require mutual value creation, not value extraction.

Unless Upwork walks back its nickel-and-dime feast, it risks being disrupted by the very workforce it once empowered. Established players like Fiverr and offer more transparent, modest fee structures, though their pricing fairness is debatable. However, a new wave of freelance-friendly platforms shows true disruptive potential — platforms like Braintrust’s decentralised network, Toptal’s elite premium talent focus, as well as newcomers CreativePool, YunoJuno , Working Not Working and others. Some of these upstarts aim to nurture independent talent rather than preying upon it for profit.

Upwork can still course-correct toward more equitable policies. But it must shed the delusion that freelancing is just another revenue stream to be ruthlessly maximised. Freelancers are skilled professionals, not cash cows to be endlessly milked. Restoring that ethos is vital for Upwork to remain relevant in the evolving future of work.

Closing Comment

I have done my best to accurately capture Upwork’s fee structures, but with the constantly changing pricing models, some details may be contradictory or incorrect. I apologise if any figures are misstated — the intent was to shine a light on the company’s excessive nickel-and-diming practices.

Work with Samantha W

“Solving niche challenges founders face”.

Illustrator: Lisa Williams (Instagram: @artist_llw)


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