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Fee Type Definition
Non-Hourly With contingent fees, the firm assumes most of the risk but is usually
Contingent Fee eligible for a large reward upon success. There is an agreement that fees
are completely based on the recovery of funds, which is normally a
percentage of the amount recovered.
Non-Hourly How expenses are paid and who is responsible for them is part of the
Procedure Pricing negotiation.
(or Flat Fees) This is selling services like a product. There is a name of a service with
an assigned dollar amount, for example: Medium Plaintiff Deposition,
$XXXX
The typical mix of firms’ arrangements as seen today:
20% Standard Rate
60% Unique client arrangement (rate plus outside counsel guidelines)
20% Non-standard fee types
Best Practice
Data aggregation should be driven from a data engine within a configurable platform that
ensures long-term performance and knowledge tracking; this system would incorporate cost
allocation and margin calculation to aid more accurate pricing and budgeting modeling. It
would typically include:
o Flexible views of income basis from multiple angles
o Flexible cost allocation models, such as:
Direct:
Compensation/bonus decisions
Partner compensation
Other direct allocations – (administrative assistant, bus. dev., etc.)
Management reallocation
Overhead:
Distribution
Weighting
FTE
Margin calculations
o Unit cost information (specifically for pricing and budgeting)
o Simple reporting/analytics paired with targets
As firms absorb how much they need to understand how to price, the value of their data
has grown significantly, as has the value of correlating data from various systems and siloes of
information within a firm. Since the fundamental question both clients and firms need to resolve
is whether it is less costly to go to some form of non-hourly fee or absorb the inevitable
119
Non-Hourly With contingent fees, the firm assumes most of the risk but is usually
Contingent Fee eligible for a large reward upon success. There is an agreement that fees
are completely based on the recovery of funds, which is normally a
percentage of the amount recovered.
Non-Hourly How expenses are paid and who is responsible for them is part of the
Procedure Pricing negotiation.
(or Flat Fees) This is selling services like a product. There is a name of a service with
an assigned dollar amount, for example: Medium Plaintiff Deposition,
$XXXX
The typical mix of firms’ arrangements as seen today:
20% Standard Rate
60% Unique client arrangement (rate plus outside counsel guidelines)
20% Non-standard fee types
Best Practice
Data aggregation should be driven from a data engine within a configurable platform that
ensures long-term performance and knowledge tracking; this system would incorporate cost
allocation and margin calculation to aid more accurate pricing and budgeting modeling. It
would typically include:
o Flexible views of income basis from multiple angles
o Flexible cost allocation models, such as:
Direct:
Compensation/bonus decisions
Partner compensation
Other direct allocations – (administrative assistant, bus. dev., etc.)
Management reallocation
Overhead:
Distribution
Weighting
FTE
Margin calculations
o Unit cost information (specifically for pricing and budgeting)
o Simple reporting/analytics paired with targets
As firms absorb how much they need to understand how to price, the value of their data
has grown significantly, as has the value of correlating data from various systems and siloes of
information within a firm. Since the fundamental question both clients and firms need to resolve
is whether it is less costly to go to some form of non-hourly fee or absorb the inevitable
119
