Need a Quick Vent, and a Question For Next Time

[Vladimir G]

Hi Jennifer,

I'll reiterate that a freelancer can file a dispute in that case and "request" their payment that way, as in other cases when an issue arises on a Fixed-Price contract. We've heard users' feedback and shared it with our team.

[Jennifer D]

Understood, Vladimir. However, I was specifically answering Tiffany's "what happens if no one does anything" question:

"Presumably, the freelancer could initiate a dispute at that point, but what if he doesn't? If no one takes any action, what happens? We know the money can't stay escrowed for more than (90 days?). When the clock runs out and Upwork closes the contract for inactivity, where does that remaining money go? By what process?"

[Vladimir G]

Hi Jennifer,

You quoted the correct article of Upwork ToS. In addition to being notified two weeks in advance, closing a Fixed-Price contract with funds in Escrow after 90 days of inactivity will automatically generate a refunds request, which the freelancer will have 7 days to dispute. If they reject the refund request, a dispute is created and mediation begins.

If they take no action, Escrow will be refunded back to the client

[Joshua T]

So, Vladimir, in the scenario we've been talking about:

   -- Project is accepted for $500, one milestone, fully funded

   -- Work is completed in its entirety and submitted

   -- Client edits milestone amount and releases $75

   -- Client does not create a new milestone and goes idle

What you're saying is that, after 90 days, it would trigger a refund request and the freelancer has 7 days to dispute. If they do so, mediation ($$$) starts.

This does not sound like "protection" for the freelancer at all. In this case, what incentive does the client have to come back and pay? They have their work in hand. In fact, if I were a less than ethical client, this kind of setup gives me a great chance at having my completed project AND getting a big chunk of my money back.

[Valeria K]

Hi Joshua,

As we previously discussed on this thread, the freelancer can raise a dispute anytime if there are funds in Escrow, the job was completed but the client fails to release the full payment for the completed job. They can but don't have to wait for the auto-release process to start. 

[Tiffany S]

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@Vladimir G wrote:

Hi Jennifer,

I'll reiterate that a freelancer can file a dispute in that case and "request" their payment that way, as in other cases when an issue arises on a Fixed-Price contract. We've heard users' feedback and shared it with our team.

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The bottom line is that it appears that a freelancer is not actually protected by a funded milestone, since the client can gut the milestone and then force the freelancer through a dispute or even costly arbitration just to get what was presumed to be protected by escrow.

The fact that the freelancer can file a dispute is something, but it's not at all what a funded milestone is held out as representing, and that change should not be possible without the freelancer's consent. 

[Vladimir G]

Hi Tiffany,

I'll confirm the remaining funds in this scenario are still in Escrow and are covered by Upwork's Payment Protection. The process is the same as in case of a fully funded Milestone not being released due to an issue which both parties can't resolve independently.

[Kathy T]

This all doesn't make any sense to me. (maybe you can insert a blond joke because I'm blond) Why doesn't all escrowed amounts  automatically release to the freelancer after that 14 day period after a job has been closed (either by the client or freelancer?)

I understand that a client can choose to release a certain amount but to actually change what should have been funded is ... it just doesn't make sense. What's the point in using escrow?

[Valeria K]

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@Kathy T wrote:

 Why doesn't all escrowed amounts  automatically release to the freelancer after that 14 day period after a job has been closed (either by the client or freelancer?)

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 Hi Kathy,

14 review period starts when the freelancer submits work and requests payment not when the contract is closed.

When  the contract is closed, there can be two scenarios:

- If the contract is closed by the freelancer, all funds in Escrow are refunded to the client.

- If the contract is closed by the client, the client has to choose to either release the funds in Escrow to the freelancer to request for those funds to be refunded to them, If they do the latter, the freelancer will have 7 days to dispute the refund request.

[Joshua T]

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@Valeria K wrote:

- If the contract is closed by the freelancer, all funds in Escrow are refunded to the client.

- If the contract is closed by the client, the client has to choose to either release the funds in Escrow to the freelancer to request for those funds to be refunded to them, If they do the latter, the freelancer will have 7 days to dispute the refund request.

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 This is the crux of the problem. In the event that the client receives complete work, releases partial payment, then does not set another milestone, the onus always is on the freelancer to dispute and enter costly arbitration, just to get the money he or she completed work for.