After receiving really subpar work that did not even fullfill the first milestone, I only aid for half the milestone and cancelled the contract.
I received the attached message from UpWork.
Can anypne please tell me whst happens if I select the third option?
Nothing will happen except that you can leave a comment about why you are disputing the work and the freelancer can read it. It really does nothing to help your cause, unless it somehow convinces the freelancer to accept the dispute and release the escrow. As I've learned Upwork doesn't take sides and they're essentially useless in these cases.
John is correct, but perhaps a bit too caught up in his cynicism to provide really useful information.
When you comment in a dispute thread, that comment is available to the freelancer and to Upwork staff. Upwork staff does not (in fact, cannot) make a ruling on the issue. Instead, they attempt to facilitate an agreement between the freelancer and the client and assist in processing that agreement if necessary.
If the freelancer doesn't agree to refund the portion of escrow you've requested and you don't reach an agreement, it will be up to the freelancer to initiate arbitration. If he/she doesn't initiate arbitration, you'll get your money back. Arbitration costs each party $291, so if the amount of money at issue is relatively small, it's unlikely the freelancer will do so.
If the freelancer does pay the $291 for arbitration, then you'll have a choice to make: pony up your own (non-refundable) $291 to go to arbitration, or let the funds in escrow go to the freelancer.
No, if you actually go to arbitration, that fee doesn't come back. Upwork contracts with an outside arbitrator, and that is his/her fee (the freelancer, the client and Upwork each pay $291)
The only way the $291 gets refunded is if one party pays to initiate arbitration and the other doesn't pay his/her share, so the arbitration doesn't happen.
Thank you so much for the information!
This is really crazy and game theory comes into play here immensely.
The first person to pay for and initiate abritration has a tremendous advantage.
You don't get to pick the first person to pay--it's determined by the nature of the dispute.
In your case, it would fall to the freelancer to make the initial payment or not--if he/she doesn't initiate arbitration, then the money will automatically be returned to you.
I agree with what others have said in this thread.
Disputes may SOMETIMES make sense for freelancers when dealing with a completely dishonest, crooked client.
But disputes are pretty much useless for clients. In fact, I think the most successful way to hire as a client on Upwork is to basically regard the "dispute" process as 100% non-existent.
Manage contracts and freelancers proactively. Don't hire unknown freelancers for large projects. Hire for smaller amounts at first and move onto larger dollar amounts and larger milestones or contracts only with freelancers who have demonstated that they can be trusted.
For a client, disputes really aren't worth the time and energy required.
If you are working with an honorable freelancer, if they can't finish the project for some reason, then they'll refund the money completely, or refund an appropriate amount, without needing to file a dispute.