Learn how dormant contracts work on Upwork, what happens when they become inactive, and how to avoid them by managing milestones effectively.
In this article
- What are dormant contracts?
- How do dormant contracts work on Upwork?
- What if no one does anything once an account becomes dormant?
- How can I avoid dormant contracts?
What are dormant contracts?
Dormant contracts are fixed-price contracts that have been inactive for a while — specifically, 90 days after the last milestone's due date — and still have funds in escrow. When this happens, Upwork may step in and start the process of closing the contract to prevent it from sitting idle indefinitely.
This gives both freelancers and clients a chance to either take action (like releasing payment or creating a new milestone) or wrap things up if the work’s truly finished.
How do dormant contracts work on Upwork?
Here's how that plays out, step-by-step:
- On day 76: If the contract is inactive and still has pending project funds, we send a two-week heads-up to both the client and freelancer
- On day 83: If no one takes action, we send a final one-week notice before closing the contract
- On day 90: If still no action, the contract is officially marked dormant
- Next, the client is asked to take action. If they don’t respond within seven days, we move to step five
- We notify the freelancer and give them seven days to request release of the funds
- After the freelancer requests release, the client has 14 days to either approve or dispute it.
- If the client says nothing? Funds go to the freelancer
- If the client disputes? It can go into mediation
What if no one does anything once an account becomes dormant?
If both sides stay silent during the dormant status process, we release the funds to the client by default.
How can I avoid dormant contracts?
If you're not ready to close the contract yet, adding or adjusting milestones keeps things open because:
- Contracts with future-dated milestones won’t close automatically
- Adding a new milestone — no matter the due date — extends the contract by 90 days
- Updating an existing milestone also resets the 90-day clock