How Much Does a Business Attorney Cost?

The cost of hiring a business lawyer depends on a number of factors, including:

• The nature of the work a person wants the lawyer to perform;
• The location in which the lawyer works;
• The size and reputation of the law firm for which the lawyer works; or, if a lawyer does not work for a firm but is a sole practitioner, the lawyer may have more flexibility with respect to negotiating a fee arrangement;
• A lawyer who is a sole practitioner may well charge less than a lawyer who is associated with a large, corporate law firm.

This list is not exhaustive. The nature of the work a person wants the lawyer to perform can vary greatly. A person may want a lawyer who is associated with a large corporate law firm in a big city such as Washington, D.C. or San Francisco to lobby a governmental agency on a political issue of importance to a corporation’s business interests. 

Clearly, what this client will pay is going to be very different from what a client might pay a business lawyer to draft a simple, standard partnership agreement or a set of corporate bylaws. Of course, most large corporations employ lawyers on a full-time basis to handle the routine legal issues of the corporation. Big Wall Street law firms will help corporate clients with initial public offerings when the client decides to go public and sell shares of stock in the company. The attorneys who do this type of work will charge the highest hourly rates in the profession.

A lawyer who is associated with a large corporate law firm that mostly handles the business-related legal issues of large corporate clients may charge as much as $1000 an hour or more. There may be more than one lawyer in a firm working on a particular legal project for a company; the firm might bill the client on an hourly basis for the number of hours each one puts into working on it. The firm will bill different lawyers at different rates, with senior partners commanding the highest hourly fee, e.g. $1,000 per hour, and the newest associates of the firm commanding lower hourly rates, e.g. $300 per hour.

What Factors are Used When Calculating Business Attorney Fees?

In addition to the type of work, the location, size and reputation of a law firm are other factors that come into play in business attorney cost or small business attorney cost. Large, big-city law firms with tens of lawyers would most likely not be interested in providing service to a small business client. A corporate lawyer targets corporate clients. 

Fortunately, an attorney whose fee is likely to be lower would be interested in working with a small business client. The average cost of a lawyer for a small business client would probably charge an hourly fee in the range of $150 to $500 per hour, again depending on the type of work to be performed, the location and the size and reputation of the firm for which the lawyer works.

What Fee Structures Do Business Attorneys Utilize?

Generally, lawyers charge clients in one of four ways:

• Hourly fee: the lawyer keeps track of the time spent on a project and bills the client an agreed-upon hourly fee;
• Flat fee: the lawyer charges a fixed sum total to complete a piece of work;
• Contingency fee: the lawyer takes a percentage of the amount recovered for the client. The contingency fee is most common in personal injury or wrongful termination kinds of cases. The contingency fee may be combined with an initial retainer; 
• Retainer: the lawyer may charge the client a flat fee that is paid on a regular basis, e.g. monthly. In exchange the lawyer performs routine legal work for the client. A retainer agreement would be a good arrangement for a business that needs routine legal work but not enough to justify hiring an attorney full time;
• Up-front Retainer: a lawyer might take a case on a contingency fee basis and, in addition, ask for the client to provide a retainer, a lump sum of money up-front to fund the costs of proceeding with a case, e.g. to a pay an expert to analyze the case and provide expert testimony at trial. The agreement might provide that the client will be reimbursed in the end out of the money the lawyer recovers in the case.

A lawyer might also collect an up-front retainer in a situation in which an hourly fee is charged. They will then subtract the amount of money they earn every month on an hourly basis from the retainer amount. When the retainer amount is used up, the lawyer may ask for another amount or just continue billing on an hourly basis. Or, if the project ends before the lawyer earns the entire retainer amount, the lawyer returns the remaining balance to the client.

What Services Do Business Attorneys Provide?

Business lawyers provide services that cover the entire range of issues that can arise in any kind of business. They can help a person or group of people set up a partnership, or any one of the various kinds of corporations, whether it is a standard corporation, an S corporation or a limited liability corporation. They can assist a person or group of people with winding up and ending a business relationship or enterprise.

Lawyers can prepare contracts for business deals or for service providers. They can review contracts that may be proposed to a business person. Or they can represent a business person in the negotiation of an important contract. 

The cost for a lawyer to write a contract might differ depending on the type of contract. If it is a standard contract, a lawyer might charge a flat fee. If it is something that has to be tailored to unique circumstances, the lawyer might charge an hourly fee. Whatever the fee, it can be a good idea to have a lawyer draft a contract as an experienced lawyer will draft a contract in a way that is most favorable to the client’s interests. 

If a business is a party to a contract and the other party fails to perform their side of the deal a lawyer can file a lawsuit for breach of contract and represent the business in prosecuting the lawsuit to a conclusion. 

Lawyers can advise businesses about personnel matters and human resource issues. Lawyers can advise clients about the whole range of government regulations that may impact their operations and advise them on strategies for dealing with regulations. Of course, lawyers can play a vital role in advising business clients about tax issues and assist with tax planning.

If a business is sued by a former employee for wrongful termination, a lawyer can represent the business that is being sued. A lawyer would usually charge an hourly fee for defending a business in a wrongful termination suit. Or, a lawyer can advise a business as to how to carry out terminations in such a way as to avoid being targeted in a lawsuit for wrongful termination.

The lawyer who represents an employee who claims to have been wrongfully terminated will probably charge a contingency fee.  The lawyer will take a percentage of the amount they recover for the employee. Usually the percentage depends on the stage at which the lawsuit concludes; if the case is settled before a trial, the lawyer may take 30 to 35%; if the case has to go to trial, the lawyer may take 40 to 45% of the amount recovered. The expenses of prosecuting the case would also have to be subtracted from the recovered amount.

What are the Advantages of Hiring a Business Lawyer?

It is best to involve a lawyer to deal with an issue or project before it develops into a catastrophe rather than after it has blown up. A lawyer can help you anticipate problems and avoid them as well as plan for all possible contingencies. 

Hiring a business lawyer is perhaps the best way to minimize risks to your business. A lawyer could even conceivably help a business maximize its profits, which is probably the first priority of most entrepreneurs.

Do I Need to Hire a Business Lawyer?

Anyone engaged in a business enterprise needs to consult an experienced business lawyer. Your lawyer can sit down with you, review your business operations and plan how to optimize your business practices so as to avoid legal problems in the future. 

You are most likely to operate your business successfully if you have an experienced business lawyer work with you to plan for your business’s future.