How does upwork’s payment protection for fixed price jobs work (using escrow)?
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Understanding Upwork’s Payment Protection for Fixed Price Jobs
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Overview
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The payment protection scheme on Upwork for fixed price jobs is designed to ensure both freelancers and customers have sufficient security throughout the course of a job. It essentially minimizes the risk of not getting paid for the work done. This is set up using the Escrow feature.
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What is Escrow?
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In simplest terms, `Escrow` is a financial agreement where a third party (in this case, Upwork) holds and regulates the payment of the resources required for two parties involved in the given transaction. This helps make transactions more secure by keeping the payment in a secure escrow account which is only released when all terms of the agreement are met as overseen by Upwork.
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How does Upwork’s Payment Protection using Escrow work?
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- Setting up of Contract: First, the client and freelancer agree on a fixed price for the work to be done and the associated deliverables. This is then set up as a formal contract on Upwork.
- Funding: The client then funds the amount allocated for the job into escrow before the freelancer begins work.
- Submission of Work: Once the job has been completed, the freelancer submits the work to the client for review.
- Release of Funds: If the client is satisfied with the work, they approve the release of the funds in escrow to pay the freelancer.
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It is crucial to note that Upwork charges a service fee from each payment which is calculated based on a tiered pricing structure.
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The Benefits of Upwork’s Payment Protection
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- It ensures freelancers get paid for all work successfully completed through Upwork.
- It enables clients to review and confirm satisfactory work before parting with their funds.
- It provides a built-in dispute resolution mechanism that can be used if any issues arise between the client and the freelancer.
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In conclusion, Upwork’s Payment Protection for fixed price jobs provides an added layer of protection for both freelancers and clients. It ensures the work is paid for while also promoting a trustworthy environment for professional freelance work.
