Legal News
Struggling law firms urged to offer fixed fees
20/02/2012
Law firms and legal service providers are being urged to offer fixed fees rather than charging by the hour.
A report by IRN Research has found that legal practices who charged clients on a fixed fee basis were likely to have a competitive advantage over those who billed by the hour.
IRN conducted a poll of 2,000 consumers, with the results showing that 80% of those surveyed would prefer to pay fixed fees for relatively simple services such as conveyancing or drafting a will, while 59% would also like to see them in divorce cases.
The results were not quite as high for more complex cases, with 38% preferring fixed fees for personal injury and clinical negligence cases, while 37% said they would be happy with a conditional fee agreement.
For employment law, this figure was 43% for fixed fees and 22% for a conditional fee agreement.
As part of its research, IRN also asked 64 law firms what they saw as negative factors most likely to affect their businesses in the next 12 months – 38% said pressure on fees, while 53% highlighted new competition and increased practice costs. Around a third voiced concerns over compliance with outcomes-focused regulation.
IRN’s report forecasts that the UK legal services market will grow by just under 4% in 2012 and by a little more in 2013. However, it sees this growth largely affecting larger law firms, with smaller practices struggling.
