Understanding Upwork’s Payment System

Upwork’s payment system is designed to provide convenience and safety for both the freelancer and the client. It uses a secure and trusted platform for funds transit, thus ensuring that a freelancer receives payment for work completed.

Payment Methods

There are two primary payment terms on Upwork:

• Hourly contracts: These are best suited for ongoing projects. Clients are billed for work hours that the freelancer logs using the Upwork desktop app.
• Fixed-price contracts: These are perfect for projects with a clear scope and defined deliverables. The payment is released once the client is satisfied with the work.

Payment Schedule

Upwork operates on a weekly billing cycle for hourly projects. Here’s how it works:

• The work week runs from Monday 00:00 UTC to Sunday 23:59 UTC.
• On Monday, clients are billed for the previous week’s hours.
• Freelancers receive the payment on their Upwork account 10 days after the end of the billing period, i.e., on Wednesday of the second week. This waiting period is called a security period, put in place to handle any disputes that might arise.

For fixed-price projects, payments are based on project milestones. Once you complete a milestone and the client approves it, the client pays the agreed amount.

Transaction Fees

Upwork charges freelancers a sliding fee based on the lifetime billings with a specific client:

• 20% for the first $500 you bill a client across all contracts with them.
• 10% for total billings with the client between $500.01 and $10,000.
• 5% for total billings with the client that exceed $10,000.

This structure incentivizes long-term relationships with clients.Let me know if you have any other questions!