diff --git a/src/libs/actions/Policy/Policy.ts b/src/libs/actions/Policy/Policy.ts
index 0b51f01bfece..2a8b0f6a2d00 100644
--- a/src/libs/actions/Policy/Policy.ts
+++ b/src/libs/actions/Policy/Policy.ts
@@ -183,6 +183,7 @@ type BuildPolicyDataOptions = {
     lastUsedPaymentMethod?: LastPaymentMethodType;
     areDistanceRatesEnabled?: boolean;
     adminParticipant?: Participant;
+    hasOutstandingChildRequest?: boolean;
 };
 
 type DuplicatePolicyDataOptions = {
@@ -2047,6 +2048,7 @@ function buildPolicyData(options: BuildPolicyDataOptions = {}) {
         lastUsedPaymentMethod,
         areDistanceRatesEnabled,
         adminParticipant,
+        hasOutstandingChildRequest = true,
     } = options;
     const workspaceName = policyName || generateDefaultWorkspaceName(policyOwnerEmail);
 
@@ -2449,7 +2451,7 @@ function buildPolicyData(options: BuildPolicyDataOptions = {}) {
     }
 
     if (adminParticipant?.login) {
-        const employeeWorkspaceChat = createPolicyExpenseChats(policyID, {[adminParticipant.login]: adminParticipant.accountID ?? CONST.DEFAULT_NUMBER_ID}, true);
+        const employeeWorkspaceChat = createPolicyExpenseChats(policyID, {[adminParticipant.login]: adminParticipant.accountID ?? CONST.DEFAULT_NUMBER_ID}, hasOutstandingChildRequest);
         params.memberData = JSON.stringify({
             accountID: Number(adminParticipant.accountID),
             email: adminParticipant.login,
diff --git a/src/pages/iou/request/step/IOURequestStepUpgrade.tsx b/src/pages/iou/request/step/IOURequestStepUpgrade.tsx
index b00ec88094ff..79f4085a0567 100644
--- a/src/pages/iou/request/step/IOURequestStepUpgrade.tsx
+++ b/src/pages/iou/request/step/IOURequestStepUpgrade.tsx
@@ -118,6 +118,7 @@ function IOURequestStepUpgrade({
             currency: currentUserPersonalDetails?.localCurrencyCode ?? '',
             areDistanceRatesEnabled: isDistanceRateUpgrade,
             adminParticipant,
+            hasOutstandingChildRequest: false,
         });
         setIsUpgraded(true);
         policyDataRef.current = policyData;