Escrow

On a fixed-price contract the client deposits the money first, with a minimum of $5.00 USD per milestone, and the freelancer submits work for approval before any of it is released. If the client neither approves nor asks for changes, the funds are released to the freelancer automatically 14 days after submission. The client can ask for changes or request a refund, and the freelancer can file a dispute if the client refuses to pay for a completed milestone.

The deposit is what makes fixed-price work safe to start. Upwork's freelancer guidance says it cannot help recover payment for a milestone that was not funded in advance, so the working rule is simple: no funded milestone, no work.

Hourly contracts work differently. There is no deposit before the work; Upwork bills the client weekly for logged time, and protection comes from the work diary and Hourly Protection instead. The same page notes that hourly protection "doesn't apply to bonuses, manual time, or fixed-price projects".

Three things move money out of escrow: approval or automatic release to the freelancer, a refund the freelancer accepts, or the outcome of a dispute. A client who ends a contract with money still deposited triggers a refund request rather than a silent return, which gives the freelancer a window to contest it. Upwork has renamed escrow to project funds in its newer help articles; the mechanism described here has not changed.

For the protection rules built on the deposit, see Fixed-Price Protection and milestone.