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Setting Fees, Getting Paid

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How likely are you to get stiffed by your clients? Save yourself some aggravation and expense by taking our assessment test below:

What’s Your Risk for Getting Stiffed?

Note: this test does not apply to contingency or pro bono matters.
** I am still refining this test, so your feedback is appreciated. If you feel that your score was way off and does not reflect your “risk of being stiffed,” please let me know so that I can continue to refine the test.**

You do not have to provide your name or email to receive results!

Check all statements below that apply:

The prospective client appears to have the ability to pay for this service.
If the prospective client appears to be unable to pay the quoted fee, I either (a) offered a reduced scope of services (that will serve his needs within his budget and meet applicable professional standards) or (b) declined to accept the client.
I turn down clients with “sure thing” cases,” or who believe “money is no object” or that “lawyers are worthless, money-grubbing parasites.”
I turn down clients who ask me to work for free (in non-contingency cases).
I turn down clients who want to bargain only about price and not scope of service or terms of payment.
I requested a retainer that will cover the cost of the case and/or compensate me fairly even if client does not pay another cent.
I waited to start work until after the check cleared.
For clients who cannot pay a full retainer up front, I set up an “evergreen system,” for client to replenish a fund if it reaches a certain amount.
Where ethics rules do not allow me to put flat fees directly into my operating fund, does my retainer agreement specify a method for disbursing the fee over the life of the case.
My retainer agreement explicitly states that non-payment and/or failure to replenish the evergreen retainer is grounds for withdrawal.
I offer credit cards as a payment option (if ethically compliant).
I charge flat fees or provide estimates that explain best and worst case scenarios.
I offer different prices for different levels of service, (though ALL levels of service, low or high end, meet my professional obligations).
My retainer agreement explains to client how funds are disbursed from the trust account.
I send invoices by email.
I send invoices promptly – within same month as completion of work.
I send invoices that match the client’s payment cycles (e.g., client pays bills at end of month, send invoices at that time.
I have a process in place for quickly addressing late payments and documenting communication with clients.
I have a system for setting up payment plans if necessary.
I have a process in place for initiating withdrawal from the case where clients have not paid.
I have a lien on the file or other mechanism in place to ensure priority over other creditors.
My retainer agreement requires clients to arbitrate fee disputes or present them to a bar fee dispute panel.
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  • Leanna

    Interesting. I think those are good indicators. As I read through them I noticed things that I used to do early in my practice (not take money up front, discount my fee without reducing the extent of the services, etc) thinking I had to do it because I had less business. I don't do any of those things anymore and not one person has said “You want your money up front? No way, I'm not hiring you.” I've even had a few who pay more than the requested deposit, or call and say “shouldn't I be refilling my retainer soon?”

  • Ron Baker

    Hi Carolyn,

    I think the best predictors of getting stiffed are: not setting clear expectations up-front; not pricing up-front; and not using change orders when scope of work exceeds the fixed price.

    Clients only never pay for two reasons: they are unable or unwilling. If the former, you've made a bad customer selection issue (short of some catastrophe happening during the engagement). If the latter, it is because we have not met the client's expectation. This is usually done because they were “surprised” when they saw an invoice.

    Fixed prices solve the latter problem. Indeed, they are the only thing that does.

  • Amy

    I’m where you were, Leanna.  I am now going through a re-vamping phase to change my habits and am hoping to get the results you have.  Thanks for the inspiration, sounds like I’m on the right track.  It’s okay to say no and work only for money already in the bank-advance fees and costs.

  • Scott walker

    One of the best lines to get a client to stop arguing about the retainer is “If I can’t look out for my own interests, what makes you think I’ll look after yours’.”