Legal Professions - Compensation

Compensation

Lawyers are paid for their work in a variety of ways. In private practice, they may work for an hourly fee according to a billable hour structure, a contingency fee (usually in cases involving personal injury), or a lump sum payment if the matter is straightforward. Normally, most lawyers negotiate a written fee agreement up front and may require a non-refundable retainer in advance. In many countries there are fee-shifting arrangements by which the loser must pay the winner's fees and costs; the United States is the major exception, although in turn, its legislators have carved out many exceptions to the so-called "American Rule" of no fee shifting.

Lawyers working directly on the payroll of governments, nonprofits, and corporations usually earn a regular annual salary. In many countries, with the notable exception of Germany, lawyers can also volunteer their labor in the service of worthy causes through an arrangement called pro bono (short for pro bono publico, "for the common good"). Traditionally such work was performed on behalf of the poor, but in some countries it has now expanded to many other causes such as the environment.

In some countries, there are legal aid lawyers who specialize in providing legal services to the indigent. France and Spain even have formal fee structures by which lawyers are compensated by the government for legal aid cases on a per-case basis. A similar system, though not as extensive or generous, operates in Australia, Canada, as well as South Africa.

In other countries, legal aid specialists are practically nonexistent. This may be because non-lawyers are allowed to provide such services; in both Italy and Belgium, trade unions and political parties provide what can be characterized as legal aid services. Some legal aid in Belgium is also provided by young lawyer apprentices subsidized by local bar associations (known as the pro deo system), as well as consumer protection nonprofit organizations and Public Assistance Agencies subsidized by local governments. In Germany, mandatory fee structures have enabled widespread implementation of affordable legal expense insurance.