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marilise_t
Member

Terminate FP contract due to missed deadlines

I hired someone on a Fixed Price contract with clear milestones. He has not followed instructions, and then after clarification has not met the next 2 deadlines. No satisfactory product has been produced and no payment has been made yet. If I terminate the contract do I have to pay anything?

 

Thanks

6 REPLIES 6
prestonhunter
Member

Marilise:

Whether you would have to pay anything can't be answered with a simple yes-or-no answer. It depends on how you end things and it depends on what the contractor does. It IS possible for you to try to close the contract while paying zero dollars, but the client could dispute that.

 

This is what I PERSONALLY would do. I would write a note to the contractor:

 

"Geraldine,

I appreciate the work that you have done so far on the project. At this point it seems clear that it wasn't exactly what you had in mind. Maybe we got in over our heads with this. Maybe your schedule had unexpected complications. I don't know. The precise reasons aren't important now.

 

"The key thing is keeping the project on schedule. We're behind on the deadlines, and I need to hire somebody else. So I'd like to pay half the agreed-upon amount and close the contract, and let you off the hook from having to do any more on it.

 

"If that arrangement will work for you, please let me know as soon as you can and I'll process the payment. Otherwise, I would simply have to close the project with no payment, and I would prefer to not do that.

 

"Thank you for your understanding."


@Preston H wrote:

 

"If that arrangement will work for you, please let me know as soon as you can and I'll process the payment. Otherwise, I would simply have to close the project with no payment, and I would prefer to not do that.




 Here we go again....

 

Provided the amount was founded, and it was a fixed rate contract, it is not the client's choice to "simply close the project with no payment," and I really wish you would stop proclaiming that clients can "simply close the project with no payment,"

 

It is not as simple as that. It is deeply disingenuous to pretend that it is. It is even more disingenuous to advise a client to pretend that it is what they can do, in the hope that the freelancer is an idiot and does not understand how the system works.

 

Funds in Escrow can ONLY be returned to the client with 1) The freelancer's agreement or 2) after mediation failed and (EXPENSIVE) arbitration has decided that's the right way forward

 

re: it is not the client's choice to "simply close the project with no payment"

 

Petra,

I know this.

I did not say that the client could simply close the project with no payment.

 

I said he should offer this to the contractor as one of two possible choices:

- Get paid half

- Get paid nothing

 

The purpose is to make the "get paid half" option more palatable than other alternatives. Such as arguing or disputing. My wording helps make it very clear where the client stands with regards to his satisfaction with the contractor's work.

 

Either option would require the contractor's consent. Pointing out that either option would require the contractor's consent is not part of the negotiation tactic I am suggesting.

I am not assuming that the contractor is an "idiot" who doesn't know how the system works.

 

I am assuming that the contractor is honorable and will do the right thing. Which is to accept half payment without further discussion.

 

The only thing we need to be concerned about is a dishonorable, unprofessional contractor who would not agree to the client's olive branch.


@Preston H wrote:

I am not assuming that the contractor is an "idiot" who doesn't know how the system works.

 

I am assuming that the contrator is honorable and will do the right thing. Which is to accept half payment without further discussion.

 

The only thing we need to be concerned about is a dishonorable, unprofessional contractor who would not agree to the client's olive branch.


You are suggesting that the client falsely claims to be able to "pay nothing" - despite this being a bare-faced lie. 

 

And you know that it is the freelancer (the term "contractor" went out years ago for legal reasons) who is "dishonorable and unprofessional " .... how, exactly?

 

cupidmedia
Member

Marilise, can you clarify how you have this job set up exactly? Have you already released funds for any milestones? If you have, it's unlikely you'll be able to get that money back. If you have not yet released any funds so all the money is still in escrow, and your freelancer has not yet submitted any work through the official "submit work" button on the milestone, you might be able to get that money back from escrow.

 

If you close the contract and have funds in escrow but the freelancer has not actually submitted work for that milestone, they will be asked to approve the cancellation, and if they do so then you'll get the money back. If the freelancer just ignores the request for 7 days, you'll get the money back. If the freelancer chooses to dispute the cancellation, then Upwork will mediate the dispute. If you and your freelancer still can't come to an agreement, then it would have to go to arbitration.

 

In any case, communication with the freelancer is always the best idea first (it will also help your arbitration case if it gets to that point). Like Preston said, you should contact the freelancer and tell them that due to the missed deadlines unfortunately you need to find a new freelancer and that you would like to cancel the job. If you wish, you can offer some of the funds, like Preston suggested. You don't have to do that, but it might make the freelancer more open to an agreement instead of having to go to arbitration. How much money are we talking about here?

 

You can see a bit more information about fixed price protection for clients at this link. You can also read the fixed price escrow instructions at this link.