Wednesday, January 13th, 2021
By Gideon Grunfeld
Managing partners and other law firm leaders can be reluctant to allow junior lawyers to discuss fees with potential clients. One of the recurring concerns is that the associate might commit the firm to fees that are too low. And some firms are gun shy about discussing hourly rates because of what those figures might reflect about associates’ compensation.
As consultants to law firms, we have seen firsthand that keeping lawyers in the dark has its own disadvantages. Notably, questions about fees routinely come up in discussions with potential clients. Thus, firms who seek to improve the rainmaking abilities of their more junior lawyers should strongly consider providing more training on how to talk to potential clients about fees.
Specifically, the training should address the following five questions:
1) What can associates tell potential clients about basic rates?
For firms that charge by the hour or on a flat fee basis, the best practice is to train associates to mention a fairly broad range rather than quote a single number.
2) What can they say about the firm’s position on alternative fee arrangements?
When asked about their firms’ openness to alternative fee arrangements, most junior lawyers answer with an “I don’t know.” This can leave a bad impression on potential clients and referral sources. Advise mid-level associates to instead communicate to clients that the firm evaluates fees on a case-by-case basis and would consider an alternative fee arrangement. It might be appropriate to provide associates with a sense of the firm’s willingness to charge blended rates, as well as some guidance around RFPs, contingency fee cases, and other special circumstances.
3) What should they convey about the process of providing quotes?
At every level, lawyers should know enough to tell their potential clients how fee decisions are made (by committee, by the head of the practice area, etc.) and when (an approximate timeline). This may seem simple, but firms often fail to offer this kind of guidance, thereby leaving the potential client in the dark about when they can expect to receive a specific quote or fee agreement.
4) To whom should associates mention a lead?
If a junior associate meets a potential client, what’s their next step? Do they report this to the billing partner, the head of the practice area, the managing partner? Make this clear. You don’t want to lose out on a valuable matter because one of your lawyers didn’t know whom to tell so that the firm could follow up.
5) What has happened with other matters the firm was pursuing?
Share success stories with mid-level associates (and special counsel and non-equity partners) so that they can incorporate the same strategies into their own interactions and learn to bring in new business.
This training shouldn’t just be about what to do but also about why those methods work. Well-designed training should provide lawyers with the confidence to communicate effectively about the firm’s fees.