Are Freelancer Platforms Failing their Users? | DCR Workforce Blog

Are Freelancer Platforms Failing their Users?

In October, LinkedIn, the popular professional online network and recruiting platform, has quietly launched a pilot of ProFinder, a new tool which connects businesses with local freelancers. The service is offered at no charge! This appears to be a test marketing initiative. The service is only available only in some locations in California and for only three work categories: accounting, graphic design and writing and editing. It is also not for remote work but local work with local employers. But, I could not help but wonder if the market for online platforms is not saturated already and if the existing online platforms are failing to capture the loyalty of their users, for either local or remote work!

When I evaluated some of the leading freelancer platforms I found, without much surprise, that few online platforms are without detractors. Though I have only listed 12 of the better known platforms here, the Internet is crowded with hundreds of such players.

So, why is the deep-pocketed LinkedIn foraying into the space with a non-monetized offering? It is possible for latecomer LinkedIn to leverage its existing customer base of 380 million, to find itself at the top, even at the outset! [Excuse the digression, but this also calls for a little self-congratulation, given how the DCR Blog has been repeatedly predicting that the freelance/independent workforce is set for growth and that they are set to play a major role in the economy in the future, too. It appears that LinkedIn has been paying attention to the profiles of its subscribers.]

Let us look at the various issues faced by the hirers and the freelancers, when using these platforms. Both sides complain that the platforms have failed to scale beyond the tasks of scheduling work, processing payments from the buyers of labor, and collecting their fees. Both hirers and freelancers suffer when platforms charge a membership fee, offer few job opportunities and provide no guarantee or refund fees. Users complain that most platform vendors refuse to accept constructive feedback and unilaterally block both customers and freelancers alike when raising a concern. Each group also expressed additional concerns:

Freelancer Comments:

  • These platforms push down the rates that a freelancer would want to charge, as the competition is severe and there is always someone ready to bid for a project at a rock-bottom price.
  • Projects are often improperly scoped. The hirer may not have provided many details about the project or downplayed the amount of effort required for execution while providing a huge list of must-have features.
  • Most jobs are low-end, offering low compensation and little challenge to the workers.
  • Hirers close the project without hiring anyone, making the freelancer waste the effort and regret the unremunerated time spent on the bid.
  • Some platforms allow hirers to post a project as a contest and pick a ‘winner’ – a ploy which results in making everyone complete the project but remunerates only one of them.
  • Having done the work, the freelancer may not receive the promised payment. Not all platforms are careful enough to set up hedges or escrow accounts.
  • For milestone-based assignments, workers are often forced to spend hours revising their work for hard-to-please hirers.
  • Some platforms take 30 days to settle a freelancer’s fees after they complete a project.
  • Some platforms use verification standards which are inconsistent and unclear to reject work and refuse payment.

Hirer:

  • The ‘qualified’ contractor they hired may not be really qualified for the task and may submit poor work. The platform offers little or no recourse and makes the hirers pay, leaving them highly disappointed in the services they received.
  • Many of the hirers fail to follow the law on independent contractor classification.
  • The hirer may wish to dispute an issue like having a freelancer who logs in even after being let go, and then submits a claim for wages. The hirer’s efforts to have the claim investigated usually take too long to be settled.
  • Engagements cannot require the sharing of confidential information, as the freelancers have not been fully screened.

Given these issues and concerns, it is not really surprising to find more platform vendors entering this sector in order to offer a marketplace that serves the needs of all parties. It is only to be hoped that some of the risks will be mitigated and problems resolved by these new players. We have deliberately avoided naming a specific platform when enumerating the issues with them, but do feel free to write in and share your experiences.


Disclaimer:
The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.