Point of View (POV): You are dealing with a situation in the office, and you think there are some legal issues involved, but you don’t want to call your lawyer because you’ll be billed for .3 hours of their time. And if you do contact them, there is no way you will go into detail about upstream and downstream impacts, much less have any sort of personal conversation to get to know each other. That’s just going to increase your bill.
As you’ve probably experienced, most business lawyers charge hourly fees. Lawyers typically charge at 6-minute increments, reflected as tenths of an hour on your bill. The benefit is you get charged for the time a lawyer takes to do the work. While you might get an estimated budget at the start of a matter, hourly fees can lead to unexpected costs.
While hourly rates are the most common, there are other solutions to improve the transparency of fees and accessibility to your lawyer. Businesses can benefit from subscription legal plans and flat fees by being able to budget for legal costs more effectively.
- Subscription Plans: Subscription fees are recurring flat monthly fees for clients with ongoing legal needs. Clients “subscribe” to a legal services plan that can be tailored to their needs and budget. Clients gain accessibility and build long-term relationships with their lawyers without hiring a full-time attorney. Plans can be developed based on a set scope of work or to gain accessibility to a lawyer for ‘up to’ a certain number of hours a month, usually for rates lower than the attorney’s hourly rate. This might include day-to-day counsel, contract reviews, marketing compliance, litigation management, corporate governance assistance, or any other number of legal services.
- Flat Fees: Flat fees are fixed fees agreed upon up-front before the lawyer begins working on your matter. Flat fees are beneficial for routine or project-based legal services. For instance, flat fee work might be the right solution for entity formation and preparation of operating agreements. Another example of a project-based flat fee is to prepare or update a franchising disclosure document.
As a client, when you hire an attorney on a subscription or flat-fee basis, you know exactly how much the legal services will cost, and there are no surprises.
