What is a Contingency Retainer?

The contingency fee arrangement is one in which law firms are paid a percentage of what you recover. Usually it’s 35-40% of the total recovery, but this can vary. Employment and civil rights cases offer another possibility – fee shifting contingency. In these cases, the attorneys are paid by the employer at the end of the case. The reason that this exists in employment cases is that sometimes the amount owed to you would not support the filing of a lawsuit. For instance, if you are a store clerk and have an overtime claim worth $10,000, it doesn’t make sense to file a lawsuit that will cost $40,000, or more. But these can still be important cases. So Congress provided that an employer must pay those costs if it breaks the law and loses in court. Thankfully, the reverse is not true; you will not be required to pay your employer’s attorney fees. A law firm’s contingency fee arrangement allows it to recover the larger of the two amounts – either 40% of the total recover or our attorney fees as paid by the defendant – but not both. The benefit here is obvious, you only get paid if you recover something. The downside is that you may end up paying more – much more – than you would if paying an hourly or flat rate. Still, some clients prefer it, or that is their only option.