We are in the business of trading Opportunities
Upwork is a platform that connects freelancers and clients, that simple.
But beneath that promise there is a model, well crafted, in which freelancers bear most of the risk: paying upfront with no guarantee of reward, while the platform profits reliably.
Shame… Shame…Shame
UpWork Red Flag - Arbitration and Class-Action Waiver
Upwork User Agreement has a mandatory arbitration clause combined with a class-action waiver.
“Both you and Upwork agree to bring any dispute in arbitration on an individual basis only, and not on a class or collective basis … (‘Class Action Waiver’).”
This means freelancers generally cannot join together in a class action to challenge Upwork’s policies or practices, they must litigate individually if at all.
“You gave up the right to sue Upwork in court when you signed their unfair User Agreement, which contains an arbitration provision with a class action waiver.”
Why would company squeeze in such a point… Just asking.
2. Connects - Paying to Compete
Connects are Upwork’s internal “tokens” that freelancers must spend to submit proposals. On a basic plan freelancers receive 10 free Connects monthly, can also be purchased at $0.15 each.
With only 10 free Connects per month for basic membership, and many job posts now requiring more Connects (often 2-16 or more) to apply, a freelancer may only submit a couple of proposals each month unless they purchase extra Connects.
Because Connects are spent regardless of whether a freelancer wins the contract, Upwork makes money even when freelancers are unsuccessful.
Freelancers report that many job postings either never hire or are “ghost jobs,” meaning numerous Connects are spent without interviews or hires.
This raises the question of how much users have to bend over backwards.
3. Slot-Machine Psychology
By converting the cost of proposals into Connects (tokens) and bundling them, Upwork effectively abstracts the “real money” cost from freelancers. Spending 10-20 Connects might psychologically feel less than “$1.50-$3” in cash, reducing immediate pain of spending.
Upwork uses this nicely wrapped Connects. Spending 10-20 Connects psychologically feels less than $1.50-$3 in cash, reducing immediate pain of spending, especially when not hired is the end result.
Freelancers bid, spend Connects, and occasionally win a contract, sweet reward. The unpredictability of reward timing, sometimes weeks between wins, reinforces continued bidding behaviour, hope for winning.
Upwork creates a perfect utopia for potential users - allowing you to be independent, choose your hours, and build a business. But for many freelancers this becomes: bid more - spend Connects - wait for response - repeat. Instead of freedom, it becomes an exhausting loop.
The House Always Wins
- Upwork 2024 revenue was $769.3 million
- Industry sources suggest around 18 million freelancers registered.
- 64 million Americans freelanced in 2023, contributing US$1.27 trillion to the U.S. economy.
- Upwork annual revenue from $618 million in 2022 to $769.3 million in 2024 - 24% growth over two years.
Huge numbers of freelancers chasing opportunities, and a platform generating substantial revenue regardless of individual freelancer outcomes.
To Sum Up
- Freelancers invest time and money (Connects, proposals), but outcomes are non-guaranteed, while Upwork gets paid regardless.
- The arbitration/class-action waiver limits freelancers’ collective power.
- Connect pricing, bid competition, job posting quality, and algorithmic visibility all influence outcomes, often without transparency.
- Upwork retains control over terms, membership levels, proposal pricing, and suspension/termination decisions, so freelancers must adapt.
