In this economy, most business owners are concerned about two things: protecting their business and controlling their operating costs. If this sounds like you, do me a favor: the next time you consider hiring an attorney to represent you or your business, inquire about alternative fee arrangements.

You no longer have to risk your company’s success by foregoing the services of an attorney because you’re afraid you cannot afford one. You can hire an attorney to protect your business while you continue to control your company’s operating costs.

There are several types of fee arrangements offered by Florida attorneys. Thus, finding an arrangement that meets your business’ needs won’t be impossible. Five of the most common attorney fee arrangements are: fixed hourly rate, flat rate, retainer fee, contingent fee, and hybrid fee.

1. Fixed Hourly Rate Fee Arrangement

The majority of Florida lawyers that provide legal assistance to corporations, small businesses, and entrepreneurs use the fixed hourly rate fee structure when charging their clients for their services. When establishing their hourly rate, attorneys take various factors into consideration, including but not limited to: the attorney’s experience, the extent of the legal services provided, and the complexity of the legal issue or case. An attorney’s hourly rate may range from $250 to $500 an hour, depending on the attorney’s expertise, experience, and success rate.

Under the hourly rate fee structure, the attorney keeps track of the time spent working on their client’s case. At the end of the month (or other time period agreed to by the attorney and client) the client receives an itemized bill that lists all of the tasks completed and legal services provided to the client, as well as the time spent completing each task.

2. Flat Rate Fee Arrangement

Flat rate fees are common in simple transactional matters, such as preparation of business contracts, wills/probate, business formation/incorporation, and some real estate transactions. Generally, the lawyer will propose a flat rate for their legal services and require the client to pay all or a portion of the fee upfront before commencing any work on their case.

When considering the flat rate fee arrangement, make sure you confirm with the attorney whether or not you’re responsible for any fees or expenses in addition to the proposed flat rate.

3. Retainer Fee Arrangement

As the head of a corporation, entrepreneur or small business owner, you may already appreciate the benefits of having an attorney on retainer. When you pay an attorney a retainer fee, you’re basically paying to make sure he/she is on-call and available to you during the time period the retainer covers. Retainer fees are typically paid monthly, but can be paid quarterly or annually as well. As legal work is completed on your behalf, time and/or money is deducted from the retainer fee.

In most situations, paid retainer fees are non-refundable; however, some parties will agree to refund the unused portion of your retainer. Because retainer fee arrangements can be structured in various ways, it is imperative that you discuss this arrangement in detail with your attorney before choosing this option.

4. Contingent Fee Arrangement

The contingency fee agreement is the most common fee structure used by litigators in expensive and complex litigation cases. With a contingent fee arrangement, the attorney is paid for his/her services once the case is resolved and the settlement payment is received. The attorney receives a percentage of the client’s settlement, as well as reimbursement of all expenses incurred by the attorney on behalf of his/her client. Generally, because the attorney’s fees are contingent on settlement of the client’s case, the attorney does not receive payment for their services if he/she does not recover a settlement on their client’s behalf.

5. Hybrid Fee Arrangement

A hybrid fee structure is when a portion of the client’s legal fees are paid based on an agreed upon contingent fee, and the remainder of the legal fee is paid at a reduced hourly rate. The costs of any out of pocket expenses, such as filing fees, deposition costs, expert fees, and other trial expenses are the responsibility of the client.

The terms of all hybrid fee arrangements are not always identical. The terms should be thoroughly outlined in the attorney-client fee agreement or contract prior to the attorney commencing any work on the case. The agreement/contract must be signed by the lawyer and the client, indicating that both parties agree to the terms.

If you’re trying to protect and control the operating costs of your business, you may want to consider hiring an attorney that offers alternative fee arrangements. The attorneys of Schecter Law offer a variety of billing and payment options to accommodate their clients, including but not limited to the five most common: fixed hourly rate, flat rate, retainer fee, contingent fee, and hybrid fee arrangements.