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Fixed Contract and Escrow issue

canon193
Active Member
Le A Member Since: Dec 4, 2020
1 of 5
Hello I am working on the contract with 2 milestones and budget estimation is 1700$. The first milestone was done with 500$ deposit. However, client just put only 500$ in the escrow for the second milestone. During the project, I gave him a 200$ decrease in the budget. Currently, the project is almost done and my client request some more additional work outside the contract then told me I have to complete it before closing. He told that he could not close the contract since full budget 1700$ have to be paid. Could you please advise me on this situation?
prestonhunter
Community Guru
Preston H Member Since: Nov 24, 2014
BEST ANSWER
2 of 5

The client can close the contract at any time.

 

The client DOES NOT need to pay the full budget of $1700 in order to close the contract. The budget does not matter.

 

The client may close the contract and EDIT the amount of money to be released. The client may release ANY AMOUNT of money when closing the contract. Zero. Full amount in escrow. More. Less. Client may choose any amount.

 

If client releases less money than is in escrow, freelancer will be asked to approve the refund.

 

If the client wants you to do other work not specified in the contract, then tell the client yes, you will do that after he closes the current contract while releasing all escrow money to you.

 

After the client closes the current contract, he may hire you using an hourly contract in order to do the various tasks.

 

re: "my client request some more additional work outside the contract then told me I have to complete it before closing."

 

Of course you are not supposed to do additional work for free.

The client was violating Upwork TOS by asking you to work for free.

A client can not ask you to do additional tasks as part of a fixed-price contract unless the client creates additional funded milestones to pay you for those tasks.

View solution in original post

prestonhunter
Community Guru
Preston H Member Since: Nov 24, 2014
3 of 5

A Client hired a freelancer using a fixed-piece contract.

 

The Freelancer completed most of the work.

 

The Client needed to ask for some other tasks that were not part of the original agreement.

 

The Client handled this the correct way.

 

The Client released all money that was still in escrow.

The Client closed the contract.

The Client then asked the Freelancer if he may hire him using an hourly contract to finish these other tasks.

canon193
Active Member
Le A Member Since: Dec 4, 2020
4 of 5

Thanks for your advice Preston. I will ask the client to close the contract before starting on another work.

prestonhunter
Community Guru
Preston H Member Since: Nov 24, 2014
5 of 5

If a client wants to close a current contract and set up a new FIXED-PRICE contract, then that may also be acceptable. But a fixed-price contract is not "flexible." It can only be used for agreed-upon tasks.

 

If a client has various tasks and may think of new tasks at any time, then an hourly contract is the proper contract type to use.

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