Wyatt B.

For the most part this is a good way to save up some extra money for a wedding.
But, misleading posted policies need to be looked into.

It states here that after a release is done there is no way for Freelancer to get back the funds.

"Once the Milestone Payment is released there's no way for us to recover the funds. Make sure that the project has been completed and you are satisfied with the results before releasing your pending Milestone Payment."

And again here.

"I already released my Milestone Payment, is there a way for me to get my money back?
Unfortunately, once the Milestone Payment is released there's no way for us to recover the funds. We suggest that you work with the Freelancer to resolve the situation.
"

https://www.freelancer.com/faq/topic.php?code=employers-payments

It turns out this is not true.
1) The employer can do a callback on their card after the milestone is paid.
-> This is understandably out of the hands of the system because Freelancer cannot control all of the original payment sources in the world.

2) If the employer talks to Freelancer support they can return the funds without providing information to the Freelancer (albeit as a new milestone paid from the Freelancers account).
-> This needs to be worked on because it promotes abusive and potentially fraudulent activity on the site.

I recently had this happen to me.
Freelancer support told me that it was returned because the employer did a callback on their payment method. Freelancer support then moved the funds from my account and added it back as a new milestone for the employer. The employer asked me to do extra works to receive the funds they already had given me, but took back (Freelancer support returned to them).

A dispute was started and the Freelancer dispute team decided to give the milestone once paid, but some how returned as a new milestone, back to the employer. Total time working for this employer 20 hours. Originally posted milestones $200 USD. Released milestones $100. Milestone lost in dispute $100 + $5(dispute fee). Released Milestone returned as a new milestone $100. Re-posted milestone lost in dispute $100 + $5 (dispute fee). I received -$10 & - 20 hours. The employer received free work and front end code that they can use anywhere as much as they want.

I am still dumbfounded that I lost the dispute in spite of the fact that the employer is using the code on their publicly viewable site, screenshots, messages from the employer saying "it looks good", "wait why we post it to production", "Great job"... Even after I lost they are still using my code free of charge): The dispute team works in mysterious ways... But setting this aside.

Why have a policy posted if your own team does not follow it? Why so one sided? Nearly no information was provided to me, and when it was it was an inquisition.

Support: "Please provide evidence that the employer was satisfied with the work you've done and that it's completed"
Me: "They released the milestone! Why would they do that unless they were happy with the work?"

-> Really? The employer should be asked why they released the milestone if they were not satisfied. If they have a really good reason like "I accidentally pushed the button". "Someone has hacked into my account." etc, a refund may be in order. In other cases the support team should not even attempt to contact the freelancer for evidence of "satisfaction" when the employer pushed a button. This is a loaded question biased in favor of the employer.

De facto policy: "Once the Milestone Payment is released there are ways for us to recover the funds."

[UPDATE 2016-01-29]
After discussing this with support they clarified that they returned the milestone from released to pending. It was not due to employer payment issues. I hope they let management know that they should change the policy posted on the site. To let users know that milestone payments can in fact be returned to the Employer after they are released. They may get more projects posted by having this corrected information.

So in practice anyone can post a project with milestones set up like this and get work done for free.
Milestone 1: Prototype
Milestone 2: Second working copy
Milestone 3: Last milestone

You can then release 1 & 2 to keep the Freelancer working. At the end you can ask for whatever you want. New additions, extra functions, why not create a whole new code set for the Freelancer to work on? (this is what happened to me). And by not releasing Milestone three you go into arbitration. Since their is no complete version by the employers definition, and by clever manipulation (for example stalling the project over the deadline by simply not messaging the freelancer for a few weeks), you can ensure that you win.

After winning your arbitration you can ask Freelancer to return all of the funds, even milestones that were released previously. Based on a process that is not stated on the site you will be refunded and left with the product FREE of charge.

Who knows how this refund process is decided. I have a few guesses. But it is certainly not written on the site.

1) the employer and support team are from the same country
2) the employer complains enough to where support just wants them to close the issue ASAP.
3) Someone in support thinks that breaking the written policy on the site, is a good idea in this case.
4) Someone in support thinks that giving the case to the dispute team is a better idea than just telling the employer "No. It can't be done! Released milestone cannot be retrieved as posted on the site".

I think (4) happened in my case and it should be brought to the attention of management. I am keen to see this issue resolved to make Freelancer more secure for, well, freelancers.

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