Independent contractor

An independent contractor is a self-employed person who provides services to a client under a contract for services rather than as an employee, which is the legal status Upwork's Terms of Service give to every freelancer on the marketplace.

On Upwork the freelancer contracts with the client, and the Terms of Service say that the freelancer is an independent contractor of that client and not an employee of the client or of Upwork. In practice that means the freelancer decides how, when and where the work is done within what the contract asks for, uses their own tools, can work for other clients at the same time, and is responsible for their own taxes, insurance and benefits. Upwork collects tax forms from freelancers, a W-9 from those in the United States and a W-8BEN or equivalent from those elsewhere, and reports what the law requires, but it withholds nothing from a freelancer's earnings beyond its own fees.

The status matters most to the client. Employment law in many countries looks at how a relationship actually works rather than what the contract calls it, and a contractor who works fixed hours, under direct supervision, for one client, for years, can be reclassified as an employee with back taxes and benefits due. For engagements that look like that, Upwork offers Upwork Payroll, under which a third-party employer of record employs the person and the client pays through Upwork.

For an agency the contractor is the agency: the client contracts with the agency account, and how the agency engages its own members, as employees or as contractors, is the agency's affair under its own country's law.