When hiring a freelancer, if you determine the relationship is best classified as an employee (rather than an independent contractor), we offer Upwork Payroll service through a trusted, third-party staffing agency. In such cases, the freelancer will become an employee of a staffing vendor and assigned to you for the purposes of the project. Hourly and salaried assignments are available through Upwork Payroll, fixed-price contracts are not supported through this service.
Our staffing partners will ensure compliance with country or locale-specific laws, including but not limited to, tax and employment laws. The agency will also provide human resources support.
When hiring U.S.-based staffing vendor employees the staffing agency will
- Provide an employment agreement
- Manage payments to the employee
- Manage compliant time entry
- Provide Workers’ compensation and other legislatively required benefits as required
- Administer payroll taxes
- Provide mandated benefits (e.g. ACA compliance) and other voluntary benefit offerings
As the Client receiving work product from the staffing vendor employee, you will have the following responsibilities
- Request employees bill for time worked and discourage "off the clock" or not report hours worked
- Comply with laws preventing workplace discrimination and harassment
- Provide a physically safe and harassment-free working environment
- Allow the employee to take paid rest breaks and unpaid meal breaks as required by local laws and authorized by the employer
For employees outside the U.S., employee rights and contractual terms can differ from country to country. You will be provided with pricing, contractual terms, and country-specific regulations before you decide to move forward with the international engagement.
Important: You must not start work until the employee completes onboarding with their employer (the third-party staffing agency). This process can include background checks, and other steps required by law or by the employer. On average, for U.S. based staffing vendor employees it takes 3-5 business days to complete the entire onboarding process. For those outside the U.S., the process is typically completed within 30 days. Any work that happens before the onboarding process is complete will be your company’s responsibility.
Once complete, we will notify you, and the staffing agency will provide the employee with instructions on logging their time and getting paid. You can then seamlessly communicate and pay through Upwork platform.
Official timekeeping will occur between the employee and their employer; the contract on Upwork will be "paused" to prevent duplicate reporting.
Upwork Payroll is generally available for administrative and professional level environments such as clerical, legal, technology, video production, etc. It is not available for work involving manual labor, heavy equipment, or driving. For further information on how Upwork Payroll can help your business click here (If you are an Enterprise client please contact your account representative.)
Frequently Asked Questions
As the client, you will pay Upwork Payroll Service Fees, which are 23% of the bill rate. Your staffing vendor employee’s gross wages will be 77% of your bill rate, and the employee will not pay any service fees. You may need to increase your bill rate to maintain the same pay rate for the employee. To calculate, divide the client bill rate by .77 to see the Freelancer’s gross pay rate (See chart below).
If you are an Enterprise client the fee for Upwork Payroll is specified in your contract.
You’ll also be responsible for any additional costs for items you require or that are required by law, such as, overtime premium pay, expense reimbursements, and paid sick leave. Since health care premiums are cost-shared between the employee and their employer, it is at no cost to clients.
Unless you are notified otherwise before work starts, the employee will be eligible for overtime pay. Overtime varies by location, but in most U.S. states, it applies to hours worked above 40 in a week. The staffing provider will provide the specific overtime policy.
You can view the hours worked and payments from your Upwork account by going to Reports > Transactions. Every week you’ll see a line item in the Transactions report for each employee from the staffing provider that will include the employee’s time plus any adjustments for costs required by law, such as overtime pay, and sick time.
Upwork is here to help you resolve issues. Please contact Upwork immediately at firstname.lastname@example.org if:
- You’re concerned with the employees' work performance, so we can help facilitate a resolution between you and the Employer.
- Your Freelancer alerts you (or you become aware of) of a need for a leave of absence or disability accommodation so we can be a conduit of a compliant reasonable accommodation process as directed by the employer.
All contractual requests including ending or modifying a contract should be emailed to email@example.com. Typically, to end a U.S. based Upwork Payroll assignment, you’ll need to provide at least 72 hours notice. This allows the staffing provider to comply with any termination requirements, such as state laws governing final paychecks or termination paperwork. The notice period for assignments outside the U.S. can vary from country to country.