I recently got into a dispute with a client for a fixed-price contract, so I read Upwork's Terms of Service. Before the dispute, I thought that released funds from Escrow were irrevocable, as stated in "3.Instructions irrevocable" in Fixed-price Escrow Instructions, however, it seems a client can ask for a full refund for previously released funds by going to arbitration. In "2.1. Release conditions" says that if I don't go to arbitration the escrow funds are returned to client, so I thought my account couldn't be suspended for not going to arbitration, but later in "6.5 filing the case with the arbitrator" it says they can.
Since my client approved the milestones, and I have proof of my work, I thought it wasn't necessary but the terms say that I'm forced to go to arbitration. This is the first time that this happens to me, so I don't even know if that's enough to win an arbitration, since the work I sent to the dispute center (proof of my work), seems to not have been even considered or mentioned.
So my question is, since I see that in fixed price contracts the client can just ask for a full refund, and stays with everything (approved milestones and escrow money), I think it's better to work with hourly contracts, however, I think the Terms of Service are not very clear, so is it safe to choose an hourly contract or is there another rule I haven't read that makes it possible to the client to ask for a full refund on released funds?
There is much more room for clients to play around with not paying a freelancer in full and on time under fixed rate contracts. But there are no doubt particular types of projects where a fixed price arrangement is the best approach, and many freelancers have said on this board that they prefer fixed price contracts.
On the other hand, if you fully comply with the clear requirements of Upwork's hourly payment protection policy...
... getting paid for your work on an hourly contract is a near certainty.
I am glad that hourly arrangements are common with the type of work I do. I'd guess that I've agreed to a fixed price on less than 10% of the projects I've worked on here. And on some of them I've required a 50% down payment before I even started work. (This doesn't really do much for me other than prove the client is probably the real deal, but it is still no assurance the client won't delay further payment, request a refund, etc.)
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