Yes, milking the lower end is just unfair and will obviously create resentment in freelancers. A really long time back I complained to them that their fees were

Yes, milking the lower end is just unfair and will obviously create resentment in freelancers. A really long time back I complained to them that their fees were unfair (I think about the time when eLance and oDesk merged). And their reply was educational to me - "Why are you paying the fees? Bill it to your client or share the cost with them?". And I did start doing that. Few clients were ok with that because the <$500 crowd are the "cost conscious" (to be polite) crowd. The higher brackets were somewhat more easier to convince because they had more to lose and thus felt the indirect payment through UpWork offered them some protection. But yeah, even 10% is still high if they are also charging the other party too.