UpWork’s New Direct Contract Feature

So here‘s something cool.

UpWork has long been a useful tool for creators and freelancers to build their client bases. One of the best things about the site is its escrow system. They basically act as the hat-holder, collecting funds from clients and only releasing them to the freelancer once both parties – client & creator – agree that the project has been successfully completed. Furthermore, if there is any disagreement regarding product or payment, UpWork will assign a mediator*.

The main drawback with UpWork is the part of their User Agreement that prohibits UpWork clients and freelancers from taking their business activities offline or to another platform for the first two years of their business relationship – a tactic they refer to as circumvention. In other words, if you meet a client on UpWork, you’re supposed to use only UpWork’s tools to facilitate your project(s), which means no communicating via Gmail, Slack, or even Twitter.

Doing so requires an “opt-out” or “conversion fee” of at least a grand and anywhere up to $50k; if you neglect to pay the fee and UpWork figures out you’re communicating with your client outside their platform, they can sue you for more than you made using their service in the first place.

While these particular terms still apply, now you can make use of UpWork’s escrow and mediation services AND conduct business on other platforms like Trello and Drive. Direct contracts only work with clients you didn’t find through UpWork. They don’t have to have an UpWork account to use it to pay you, plus the handling fee is a reasonable 3.4%; there is no charge to the client.

The fee is worth it if you’re just beginning a working relationship. The most stressful part (for me, anyway) of that first project is dealing with details like how payment will work. Each party must place a certain amount of trust in the other, which adds dimensions of stress to the arrangement.

The direct contracts feature provides neutral third-party witness to the contract and its stipulations from beginning to end. There’s no incentive for UpWork to “go easy” on either client or freelancer as doing so will be more costly for their (UpWork’s) corporation in the long run.

Please note that there isn’t any kind of arrangement between this website and UpWork. This post is an unsolicited, uncompensated write-up about a potentially useful new tool on a widely-used platform.

Any service that helps clients and creators work together with confidence is worth checking out. Life is stressful enough as it is, and let’s face it, this world has its share of crooks.

“What is SMiShing?”

*Despite having never used the mediator services, it’s nice to know they exist.

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