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Escrow issue, and scam from both freelancer and Upwork

Community Guru
Preston H Member Since: Nov 24, 2014
11 of 25

I am not sure why the original poster felt that he "would have to pay" an arbitration fee.


Effective Upwork clients never use disputes, arbitration, mediation or refunds.


Effective clients use the tools Upwork provided to manage their projects. If a freelancer doesn't work out, they stop working with that freelancer immediately. Effective clients don't pay upfront to any freelancer and they don't release fixed-price payments to freelancers whose work is unacceptable. With hourly contracts, the work of new freelancers is monitored and checked closely and if it isn't right, the contract is closed immediately.

Active Member
Johann C Member Since: Aug 1, 2017
12 of 25

ok, here is a fixed contract.


I rejected the job. Client is disputing my rejection, and this is out of sense, advert is clear, and is job 100% not conform


Upwork does not do anything to appreciate that job delivered is not matching the advert.


Since no agreement can be reached, they propose to each party 290 $ for arbitration, i agrere to pay them if freelancer willalso pay them.

Value of contract was 240.


I just hope that freelancer will give by not wanting to pay for it, and thus I would not haev to pay arbitration alone, and can get money back.


In other case, if i win arbitation

I will lose only 290-240 = 50, and i don't recover anything, I will have wasted an amount 290

If i lose arbitration, I will lose a stunning totall amount of 240 + 290 = 590


Freelancer, will also lose money in all cases, if he win*, it will cost him 50 or lose all, he will lose entirely 290


In such cases, upwork is winning,a nd any 3rd party arbitration involved.


I would like you to explain me if my strategy of willing to pay arbitration is the right one, to get rid off him, supposing he will not want to pay arbitration, and simply get my money back : 240.

Community Guru
Preston H Member Since: Nov 24, 2014
13 of 25

As a client, I don't set up fixed-piece contracts that large ($240) with freelancers I don't know. I start smaller.

If the work is no good, there is less to lose.


In your situation when I saw the work, I would have told the freelancer that he has the option to fix it, in which case I can request changes, which blocks payment and means there is no dispute. If the freelancer would not make changes, I would have offered to pay him zero or pay him half immediately. Getting paid half immediately is a better deal than getting paid zero, or risking an unfavorable outcome in a dispute. Most freelancers would accept that.


Here is the botton line for me:


Using Upwork's dispute or arbitration processes are not acceptable to me. Because I know how these work and I know these are not good business practices for me as a client. So I manage my work accordingly. I don't set up fixed-price contracts without the knowledge that I might have to pay for unusable work. So I use smaller milestones or contracts. I break work into phases. Or I use hourly contracts.


And I know that my time is valuable, so I know it is a better business practice to pay to end things with a bad freelancer rather than to try to avoid paying. I don't owe bad freelancers my time. I don't owe them fairness if "fairness" means spending my time to ensure they get paid nothing. I would rather see them be treated unfairly by getting a small amount of money they don't deserve, so I don't need to deal with them any more, rather than me working more and spending time so that they are paid the appropriate "fair" amount of zero dollars.

Vladimir G Moderator Member Since: Oct 31, 2014
14 of 25

Hi Johann,


As I shared in my previous post and on the link included in the comment, Upwork pays a third of the arbitration fee if users decide to go to arbitration. Do note that if only one party pays the fee, the fee will be refunded and disputed funds released to the participating party.

Active Member
Johann C Member Since: Aug 1, 2017
15 of 25

Thanks for confirmation, I willgo on with this strategy.

Community Guru
Rene K Member Since: Jul 10, 2014
16 of 25

@Johann C wrote:


Value of contract was 240.



OK. Put arbitration money on the table. If the work delivered is not what you asked for and if this is demonstrable, the freelancer will chicken out.


Please also note that the dispute and arbitration mechanisms are laid down in Upwork's terms of service, it is wise to read them before using the platform.


This is an online platform which connects clients and providers. You may encounter a bad apple the same way as in the brick and mortar world.


The title of your thread is totally out of line and derogatory. You had one bad experience with a provider and you are accusing Upwork of conspiring with fraudsters to commit scams. Your judgment makes no allowance for nuances, one hiccup and Upwork are criminals. Seriously?


If you really believe this, continuing to use the platform makes no sense.

"Where darkness shines like dazzling light"   —William Ashbless
Active Member
Johann C Member Since: Aug 1, 2017
17 of 25

You are not neutral.


I always thought that escrow meant third party guarantee. Upwork word used are misleading


This is also a bad surprise to see how tos are setup, and how we can get being asked to pay even moire than fees already paid on job


I persist, I am disappointed, like any other client confirmed it in this tread


Now i got answers I needed

Active Member
Johann C Member Since: Aug 1, 2017
18 of 25

Note that, i don't want anymore to work with such freelancer, my project was urgent, i hired another good freelancer in themean time, job was done 100% right, and freelancer paid of course.

Community Guru
Preston H Member Since: Nov 24, 2014
19 of 25

By his own account of his Upwork history and this situation, the original poster has had 26 or 27 contracts on Upwork that were successful. And one contract with a scammer.


That is actually a very positive and successful track record.


I would think that would be considered a good record any where. It is good for Upwork, and it is a much better record than I have had using other resources or platforms to hire people.


If the client doesn't like how Upwork disputes and arbitration work (neither do I), and wants to take his business elsewhere, that is totally his perogative. But going somewhere with different dispute or arbitration processes will not guarantee that hiring outcomes are more likely to be successful. Unfortunately the scammers go to anywhere that clients can be found.

Community Guru
Petra R Member Since: Aug 3, 2011
20 of 25

By Escrow regulations and legal terms ONLY a qualified, licensed, independent third party can make a legally binding decision over the Escrow funds. This means that even if Upwork wanted to, they could not make a legally binding decision who should get the Escrow funds.