Previous: IV. How Much is My Case Worth?
The most common question heard by plaintiff’s employment lawyers is whether the lawyer will accept a case on a CONTINGENCY basis. That is, will the attorney take the case without charging the client, but rather take their fee (usually one-third or 40%) from the amounts recovered if the plaintiff wins? Most plaintiffs’ employment lawyers do take some cases on a contingency basis, but those are the strongest of cases where the attorney is convinced that monetary damages will likely be high. Even under a contingency arrangement, however, the client remains responsible for paying the expenses of litigation, as discussed above, such as court reporter fees.
Thus, a typical employment case will cost the client @$5000 even on a contingency basis. If a decision is made to hire an EXPERT WITNESS — such as an economist to testify to the value of pension or benefit losses, or a therapist to testify to emotional distress — it is possible for the client to spend several thousand additional dollars to retain and pay the expert witness.
The most common fee arrangement (at least in the Chicago area) is a modified contingency agreement. That is, the lawyer takes one-third of the proceeds if the case settles, or 40% once trial begins, and charges the client a RETAINER and an hourly rate. Then, if the plaintiff wins at trial or the case settles, the attorney takes one-third or 40% of the proceeds, but credits back to the client all amounts paid as of that date. If the plaintiff does not win, the attorney keeps all amounts paid as legal fees to date.
Typical retainers in the Chicago area for employment cases range from $1000 to $10,000 and hourly rates (generally speaking) from $75.00 to $350.00 per hour or more. For example, if you pay a $5000 retainer (which is most common), and an hourly rate of $125.00, the retainer covers the first 40 hours of work on the case. After that, you will receive monthly bills for the work done in that month.
How many hours of work does an employment case typically require? If it settles just before trial begins (a common settlement time) it usually takes about 200-250 hours of time. If it goes through a trial, it usually takes about 300-350 hours of time. Thus, a lawyer charging you $125 per hour has charged you @$25,000 to get to the eve of trial and @$37,500 to handle the case through trial.
Next: VI. Why don’t Employment Lawyers Handle Every Case on a Contingency?
