Mediation

Upwork describes two paths. Where the client has deposited funds, it offers "free dispute assistance first". If no agreement comes of it, either side can go to arbitration; if both decline arbitration after rejecting the resolution from dispute assistance, the funds are released to the client. Where no funds are held in escrow, Upwork first gives mediation assistance; if that fails and the contract is fixed-price, arbitration is the next option, and if both sides decline it the case is closed.

Arbitration is the step after mediation, and it is not free. An independent arbitration company reviews the case and makes a binding decision that Upwork upholds. You have seven days after a notice of non-resolution to agree to arbitration and pay for it. The cost is given in Upwork's email; in most cases the freelancer and client split it evenly, and if the cost of the contract is over $20,000 Upwork pays part of the fee. On deposited funds, if only one side pursues and pays for arbitration, the funds go to that side. Failing to comply with an arbitration outcome leads to an account entity suspension, which can block payments and withdrawals.

That sequence shapes the decision. On a funded milestone, a client who rejects the mediated resolution can wait: if the freelancer also declines arbitration, the money returns to the client. The freelancer's real choice is whether the amount at stake is worth an arbitration fee.

Upwork's pages use several names for this stage, including dispute assistance and mediation specialists. How a case reaches it is covered under dispute, escrow and Fixed-Price Protection.