vWorker - Fees
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The entire cost of using vWorker comes in the form of transaction fees that are deducted from the value of each project completed by a contractor. There are several different rates that vWorker uses, depending on the type of project and the circumstances under which the payment is made.
Fixed rate projects—which are by far the majority on vWorker—incur a standard transaction fee of 15%. This applies to both open bid and invite-only projects. If a client and contractor have worked together before, a client can open a follow-on project with the same freelancer, which reduces the rate to 12.5%. A client can also pay a bonus to a contractor after work is completed; such payments do not use escrow, and vWorker’s arbitration process doesn’t apply to them, so the site provides a further discount, dropping its commission to 10%.
The fee for hourly projects is fixed at 9%. This is much lower than the fixed rate transaction cost because, again, some of the protections that vWorker is paying for with its high fixed rate percentages don’t apply. Most notably, the complex arbitration system that vWorker uses on fixed rate work doesn’t apply to hourly jobs: clients can only dispute whether hours billed were in fact worked on their projects, not whether the work done was up to the client’s quality standards. See the discussion of both payment guarantees and arbitration for more.
vWorker offers a further reduction of 2.5% off all of the numbers above if a “preferred payment method” is used by the client: thus, the figures of 15%, 12.5%, 10% or 9% become 12.5%, 10%, 7.5% or 6.5%, respectively. These “preferred” methods are bank transfers or checks, for which banks do not deduct a percentage when a client makes a payment to vWorker; the discount is vWorker’s way of passing the savings along. Unfortunately, in practice, most clients prefer to use more convenient payment methods, such as credit cards, where this 2.5% reduction doesn’t apply.
One final point is that vWorker has a $3 minimum fee on all transactions, regardless of the nominal percentage that applies. This is one of the few vWorker policies that I take issue with, because the site implemented this minimum without setting a reasonable minimum project value.
I can’t object to vWorker wanting to get a decent payment on each project, but they don’t seem to have provided that same protection to freelancers. With no project value minimum, that $3 can become a staggeringly high percentage of the value of smaller projects: in the worst case, a $4 project results in the equivalent of a 75% transaction fee! If vWorker set a minimum project value of $20, they’d be guaranteed their $3 automatically—15% of $20 on a standard project is $3—while contractors would avoid the high percentage fees and low payment rates associated with $5 or $10 projects. I realize that contractors do have the right to not bid on such listings, but I honestly think vWorker itself is better off without them.
Note that there are no transaction fees for vWorker’s special “bulletin board” listings.
vWorker provides several methods for withdrawing funds, and charges for all of them. The cost ranges from $2 to as much as a whopping $55, depending on the method. These charges are mainly based on the actual costs associated with sending payments to contractors, but vWorker’s fees here seem to be a little higher than they are for some other sites. See Payment Methods and Mechanisms for more information.
vWorker has no other miscellaneous or incidental fees that I know of.
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Last Site Update: December 13, 2011
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