Authors:Catherine Baksi
Created:2015-09-01
Last updated:2023-09-18
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Cutting through the fog of fees
While government ministers glibly talk of social welfare lawyers being paid £200 an hour, back in the real world, Catherine Baksi finds a payment system bogged down in complexity and that some in the profession are turning to state benefits to top up diminishing earnings.
The labyrinthine complexity of the fee regime makes working out legal aid earnings a notoriously complex task.
Shelter solicitor Kathy Meade gives some flavour of the complexity involved in answering the question of what do housing lawyers earn an hour? In relation to housing legal help work she says: ‘Different types of activities are charged at different rates, eg the hourly rate in London of £48.74 applies to attendance on the client when taking instructions or advising them and also to preparation – such as drafting submissions to the local authority or long letters or telephone calls to the opponent, but then short letters and short telephone calls of six minutes or less have their own rate of £3.78, which is not a straightforward percentage of the hourly rate. Then if there is travel time involved that has its own rate …’ A similar multiplicity of rates will apply across all other types of legal aid work.
While cutting through the haze of rates to arrive at a clear view about earnings may be difficult, one thing remains plain: claims by justice minister Lord Faulks that social welfare lawyers being paid £200 an hour are entirely indefensible (which hasn’t stopped government defending them, however (see box)).
Rather than the £200 an hour Faulks cites, fees for these cases are more like £50–70 an hour, but for many cases, lawyers are paid fixed fees of around £160, for what may amount to a day’s work. Court representation is paid at the rate of £60–70 an hour. As legal aid lawyers point out, this is not the sum that ends up in their pockets, but a gross amount out of which overheads have to be met.
‘An accredited police station rep will earn £12–16,000; a junior duty solicitor, £18–22,000; and a senior assistant duty solicitor, £23–30,000.’
On the criminal side, practitioners have just had their second 8.75 per cent pay cut in 18 months (a move which sparked outrage and criminal firms refusing to take on new cases).
James Parry, solicitor advocate at Parry Welch Lacey, gives the following summary, on his blog, of the impact of the fee cuts.
The amount paid for attending at the police station varies, according to geographic location, from £122.88 to £162.20 (across Merseyside) for an entire case, no matter how many times the solicitor has to return and regardless of the seriousness of the charge.
Fixed fees for cases in the magistrates’ courts range from £182.81 for the least serious guilty plea to £653.99 for the most serious trial (with standard fee limits ranging from £246.22 to £704.88). The rates are worked out using a notional hourly rate of £44.43 (the national rate; the London figure is a slightly higher £45.50). Meanwhile, fees paid in the Crown Court for the most serious offences are £615.14 for a guilty plea, £817.84 for a cracked trial and £1,326.86 for trial.
‘A partner in a two-partner criminal firm says they are “unable to pay professional obligations or personal running costs or debts”.’
Taking into consideration all the preparation and attendance on the client and at court, Parry estimates that a basic trial would take 14 hours and 42 minutes. On that basis, he calculates that the equivalent hourly rate in a murder case would be £90.26. In the less serious matters, which attract lower fee rates, he calculates that the hourly rate in a case involving serious violence or drugs is £67.51, and £21.99 for a case of dishonesty.
He calculates that the average salaries received by those in the criminal sector are £12–16,000 for an accredited police station representative, £18–22,000 for a junior duty solicitor and £23–30,000 for a senior assistant duty solicitor.
The most recent figures available from the Office for National Statistics were produced six years ago – before LASPO or the 17 per cent criminal cuts – and show that legal aid lawyers were earning around £25,000. That sum, the ONS said, was lower than teachers, nurses and sewerage workers.
The situation for junior lawyers, struggling with student debt while surviving on relatively low incomes, was highlighted by a survey conducted by the Young Legal Aid Lawyers group (Social mobility & diversity in the legal aid sector: One step forward, two steps back, October 2013). This revealed that over two-thirds (67 per cent) of respondents earned £25,000 or less. Indeed 5 per cent earned less than £10,000, with 37 per cent (the highest proportion) earning between £15,000 and £20,000.
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Royal Courts of Justice: a senior barrister instructed on a Court of Appeal case can earn up to £225 an hour, insists the Ministry of Justice
Lawyers with benefits
Struggling to make ends meet is not just the preserve of junior lawyers. Low wages span all levels of seniority and some lawyers are forced to top up their income with state benefits.
A 13-year PQE criminal solicitor in Sheffield, who preferred not to be identified, is one such example. A single mother of two young children, her £36,000 a year salary is topped up by the £70–80 a month she receives in child tax credits.
‘I am 42 years old and at the top of my salary scale. My salary won’t go up and I can’t progress. I’d much rather I wasn’t on benefits, but the cost of being in work is often defeating,’ she says.
Noting that all her contemporaries, who work as teachers, nurses and police officers, earn more than she, she accepts that every profession has a market rate. But she adds: ‘We do a complex job. We are qualified to a high standard, have a high level of regulation, CPD requirements and have to provide a high-quality service. I could have gone into another specialism where I would earn 10 times the amount I do now.’
‘A 13-year PQE criminal solicitor says: “I’d much rather I wasn’t on benefits, but the cost of being in work is often defeating.”’
A Sussex sole practitioner with 20 years’ experience, disabled with cerebral palsy, has also been driven to claim tax credits in addition to disability living allowance, as her income has fallen due to the fee cuts. ‘My annual fee level is £27,000 and after business expenses this leaves little available, so I have had to claim tax credits,’ she explains.
She has not applied for a new duty contract and fears she will have to close her business next year, which could mean she loses her home and car, which is leased to her under the Motability scheme to enable her to work.
#notafatcat
On the same day that criminal solicitors began their recent protest action against fee cuts, a group of lawyers launched a website and social media campaign to highlight to justice secretary Michael Gove their low rates of pay. The campaign, using the Twitter hashtag #notafatcat (or #notafatcatmichael), encourages lawyers to tweet their fees.
One typical example states: ‘Cracked trial legal aid fee £194. 4 hearings. 16 hours work. Less expenses = minus 26pence per hour. #notafatcatmichael #saveukjustice.’ Meanwhile, a Liverpool solicitor in a sex offence case in which the defendant pleaded guilty at the Crown Court said he received fees equivalent to £10.91 an hour.
A second six pupil in a leading London criminal defence set explains that his chambers gives him a monthly cheque to make up the difference between the payments he receives and £1,000. But, he explains, it makes no allowance for the fact that part of the money he receives goes to reimbursing travel costs that he has already incurred. He estimates that his average net income is £815 a month. Working approximately 55 hours a week, he calculates his hourly wage is £3.42.
But why should lawyers earn more than they currently do? One answer is that their work often saves the taxpayer money. Doughty Street Chambers and solicitors Bindmans provided a powerful example of the money-saving effect of a good legal aid lawyer. They represented a young man who had, on the incorrect advice of his previous legal advisers, pleaded guilty to possession of indecent images of a child. While he was in a relationship with a teenage girl, the pair had sent each other explicit pictures of themselves. After the relationship ended the defendant was arrested and the photos of his former girlfriend, who had been under 16, were found on his mobile. After months of effort and several court appearances, the lawyers succeeded in getting the conviction quashed, the prosecution discontinued and a not guilty verdict recorded.
How government justified its claims that social welfare lawyers are paid £200 an hour
‘The question that arises out of social welfare law is whether it is always necessary for everybody who has quite real problems to have a lawyer at £200-odd an hour or whether there are better and more effective ways of giving advice.’
Lord Faulks, Minister of State for Justice, 10 June 2015.
Lord Faulks’s comment not only sparked fury in the profession, but piqued the interest of FullFact.org, an ‘independent factchecking organisation’, launched in 2010, which claims ‘nearly every national newspaper and politicians from across the political spectrum have issued corrections at our request’.
Despite considerable effort on FullFact.org’s part, however, Lord Faulks has refused to retract the comment made during a House of Lords debate about LASPO.
Instead, when challenged to substantiate the claim, the MoJ came back with a two-fold response. First, it cited the example of a senior barrister instructed on a Court of Appeal or Supreme Court case. Such barristers, it said, can be paid up to £225 an hour. It also argued that some fixed-fee work – say debt cases, which pay a set rate of £180 – would equate to an hourly rate of the kind cited by Lord Faulks, if the case was dealt with in an hour.
Giles Peaker of Anthony Gold says the MoJ is being ‘extremely disingenuous’ with these assertions. Lord Faulks was specifically referring to advice work, which would not encompass QCs acting in the Supreme Court. ‘The numbers of social welfare legal aid-funded Supreme Court cases a year will be 10–15 at most, out of the tens of thousands of funded matters. This would not amount to the “always necessary” in Lord Faulks’s claim.’
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Sara Stephens (pictured), convenor of the Housing Law Practitioners Association legal aid working group, says the notion that legal help cases can be routinely knocked out in an hour is fantasy.
‘Post-LASPO,’ she says, ‘there is no passporting of means, so income assessments need to be carried out for every single client. This will take between 30 and 60 minutes, or longer, depending on the complexity of the client’s finances. This eats into the legal aid fixed fee before you’ve even begun to take instructions. You then need at least an hour with a client to obtain proper instructions on the case and, even if you decide that there are no grounds to take the case further, you will at least have to send client care and advice letters, which again is likely to take 30–60 minutes depending on the complexity of the legal issue.’
The MoJ doesn’t publish figures about the number of legal help cases completed in an hour, although practitioners believe that it does record this data.
FullFact.org is still waiting for a response to its freedom of information request to the MoJ, seeking statistics so it can work out the frequency of these £200-an-hour scenarios. It says, however, the fact it needs to submit an FOI at all, rather than the information being readily available, is telling, and ‘suggests they’re not typical and don’t justify implying that the general experience of legal aid lawyers is to charge at this rate’.
It concludes that Faulks’s department ‘has provided no reasonable evidence that more than a hypothetical handful generate these kinds of costs – never mind “everybody”.’
Fiona Bawdon
‘A trainee criminal barrister estimates that his average net income is £815 a month. Working approximately 55 hours a week, his hourly wage is £3.42.’
The advocate spent more than 70 hours on the case and travelled 640 miles. However, because the case was discontinued just before the trial when all the preparation work had been done, no trial fee was payable. The litigator’s fee in the case was £330.33, which equates to £4.66 an hour; while the advocate received £194, just £1.50 an hour. If the lawyers had acted in their own financial interests (rather than those of their client and the taxpayer) and the case gone to trial, those fees would have been £670 and £1,600 respectively.
Trading while insolvent
The fee cuts are threatening the livelihoods and viability of many firms. A partner in a two-partner criminal firm that is trading while insolvent, in breach of practice rules and at risk of being shut down by the Solicitors Regulation Authority, admits he is ‘deeply ashamed’ to be in such a position. He says that the partners, who run the firm from home, are ‘worn out, tearful, frightened, unable to pay professional obligations or personal running costs or debts’.
When the tax bill came in January, the firm could not pay. It held the taxman at bay until May, when collection agents attended and threatened to take walking possession of home contents. At this point the pair borrowed £10,000 on two credit cards and cannot now make the minimum repayments. Neither partner received any income from the firm in May, June or July.
Naturally, the firm has income that it is expecting from cases, but when those cheques arrive they will have to be divided up between creditors. ‘We are working for the bank and the taxman now,’ he adds.
A living wage
Many lawyers in the capital are earning less than the London living wage of £9.15 an hour.
John Gallagher, principal solicitor at Shelter, is worried about the future. ‘I can’t see that the legal aid salaries are enough, certainly in London, for younger lawyers to contemplate living on as they reach their 30s.’
He adds: ‘Legal aid providers will struggle to provide a service if we can’t attract people, because they cannot afford to live on the income generated by legal aid.’