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Lawyers & Ethical billing


13.05.19

Is there such a thing as ethical billing when it comes to lawyers? 

You might already be familiar with how lawyers traditionally bill. Lawyers have traditionally billed in six-minute increments. Ten six minute increments make up the hour and therefore the hourly rate.

Just say the lawyer’s hourly rate is $500, the lawyer would charge you $50 per six minutes (or less!) that they spend working on your file, reading your email or communicating with you. I know one lady where the lawyer charged her for reading an email where she merely responded to say thank you!!!!

Slowly, the legal profession has moved towards fixed pricing. This is terrific on the one hand because you have some certainty over the amount that you’ll pay for the work you ask your lawyer to perform. You can then appropriately plan and budget the spend.

Word of warning though, the fixed pricing could be one of two things—working off an hourly plus a buffer or, value based billing.

Before committing to a fixed price, some lawyers work out how long it’ll take them to do the work. Let’s say it’ll take that lawyer two hours to do the work at $500 per hour. The lawyer offers you to do the work however, for a fixed price of $1,500.

You might wonder—why the extra $500??

Well, this is because the lawyer is originally working off their hourly rate and including a ‘buffer’ in the event that the work takes them longer to perform. The buffer is the risk the lawyer takes and is the price that you pay in certainty about fees.

If it takes them less time than the fixed price and say it only takes them an hour and a half (or they get their junior to do the work), then they’re ahead financially. If the work however, takes them longer, then you’re no worse off. (Beware of the exclusions and exceptions to the fixed price though!).

Value based billing is where the lawyer looks at what it’s worth to you for them to do the work. For example, where a couple is separating and their net worth is in the millions, the lawyer might look at the pie available to split, and see that there is capacity for their client to pay the fixed price they ask for. The lawyer contends that there is value in the outcome that they, the lawyer, are providing to the client, forming the view that it’s appropriate for them to bill the client a higher fee than if the pie was smaller.  

We embrace what we call ethical billing.

From our perspective, ethical billing is what’s morally appropriate, fair to the consumer and the business, and reflects the value for the work that is produced and the experience that is offered.

We’re not in the business of ripping people off in times when they can be already at their most vulnerable.

Ethical billing is transparency of fees and billing practices. This includes communication of expectations about payment terms—when bills are issued, when they’re due and how payment can be made.

We’re different from other firms that offer generic fixed pricing:

  1. It’s not dependent on how much money you have or what the pie is worth. You could have a few thousand dollars or millions. It doesn’t matter to us. 
  2. We know that have a smooth as possible easy experience to finalise the separation is priceless. You can’t easily put a price tag on being able to separate with (as opposed to ‘from’) your partner, with conflict being minimised, timely outcomes and certainty.

When it comes to how we charge and our pricing structure, we look at our overheads, we look at the financial circumstances of the people who we help and their capacity to pay. We know we offer value and quality and we don’t skimp.

We won’t work with people who want things on the cheap and don’t value what we offer. We are clear, upfront and transparent about fees, the benefits and the value—all of which our clients have previously confirmed to us.

You either see the value in what we do and how, or not. 

Check out our Online Store for the value stacked, services that we offer for affordable fixed prices.