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Free labour lawyer? The dangers of contingency fee structures.

Putting aside family and reputation, one of the biggest inducers of stress if you’ve been unfairly
dismissed is money.

Money to pay the rent, money for fuel, money for everything. And then, when you decide to stand up for your rights, you’re told you now need to find money for a lawyer too. This often puts you in a difficult choice: do I use my savings to pay a lawyer upfront? Or do I get one on credit, so to speak – the so called “no-win-no-fee-agreement”

You’re not the first person to be in this predicament, and you won’t be the last, so let’s look at it and
see how it works: the pros and the cons.

The Pros

Firstly, a NO MONEY DOWN LAWYER is sounds great for you: the entire problem is outsourced. You can focus on getting a new job, using the resources you have left to try to make ends meet in this difficult time.

From there the pro’s become a bit more tricky to identify.

Many firms that offer this claim that this Increases your odds of settlement and higher pay out versus trying on your own. This is partially true. Remember, the structure is no win no fee. They only get paid if YOU get a lump sum. If you want your job back or to be re-employed in another division, this type of agreement is not for you. The reason being is that they simply won’t get paid. One contract even starts off with the line ” We care about our clients and are committed to do everything we can to reach a settlement/award. So it is important that you understand our terms….”

They also often claim it is faster. This is also partially true: remember, they are looking for a lump-some pay out, not justice or to argue your case. As such, they will bombard the opponent with threatening emails, bang the table and make a lot of noise. Many employers will be intimidated and settle. Thus yes, you could get a quick settlement. However, if the employer sticks to their guns, or insists on arbitration, then they will need to do a lot more work than just banging the table. This is where they lose their motivation and start to tell you that you may not have a case at all, even if you do. Remember, the more effort they put into your matter, the more money they have spend, and the smaller their profit will be on the lumpsum pay out.

Another claim is that there it is less complicated – there are fewer documents for you to fill in as they will do it for you. Again, there is some truth to this, and this may even sound good, but if you think about it, why? They need information to fight your case. You have that information. Why don’t they need it? The answer to that is, well… as said… they never had any intention of fighting the facts of your case anyways– just merely intimidating the employer into settling. If the employer is stubborn, you will lose.


Here the list gets longer. Finding them is easy though: check the fine print.

Not everyone will qualify. They normally have a sifting process to determine how much money you earn and the merits of your case, that is, how much money they can make, and how easy will it be. If you don’t make the grade, you’re not on their list.

They rely on YOU to correctly ID the employers action: if you get it wrong then they will not represent you. That means, if you think your case is one of Constructive Dismissal, when it was actually Poor Work Performance, they may reject your case before even talking to you, because you don’t know the correct legal jargon. Not knowing legal jargon is exactly WHY you’re going to a lawyer in the first place!

Worse yet, any accidental misrepresentation on your side could also attract personal liability. That means that they could potentially sue you! One firm goes so far as to say that you ”… will only be liable for Fees if (you) intentionally provide false information, do not cooperate with BBB L to enable a favourable result”
And then, and this is an exact extract from their contract, if you “…over-utilise BBB L resources you will attract personal costs”!

Some even get you to “…agree not to contact BBB L”. That’s right! if you have not heard from them, even at an agreed time, SHUT UP OR WE WILL INVOICE YOU! That is literally what is in the contract you sign with them.

In fact one clause states “…. I will not take any action without consulting BBB L during the process, …” and “… I will not contact my employer unless requested “- If you sign up you can’t even ask your old firm for a U19 form. You have to direct it to your lawyers, who will invoice you for that luxury.

And there is of course the fee. 25% may sound like a little, but is it? If you earn 20k a month, and the settlement is 4 months, then that is 80k, and they will keep 20k. A normal law firm, where you actually get to participate in your own case can be 15K or even less. That means you end up paying more for nothing.

The settlement is also not paid into your account: it is paid into theirs. So if you happened to send them a email for a case update, or to call them, be assured that your 25% will be closer to the 50% mark, if not more, and THEY control the purse strings. You’ll get your money… well… what is left of it… and when they are ready to pay you.

Never mind money, they can withdraw from your case at any time. One contract actually states “BBB L may withdraw as my attorneys in the event that its labour experts reach the conclusion that I will not be able to obtain a settlement, or that the costs will exceed the award.” In other words, if the employer won’t settle, or if it looks like they may need to do work, its goodbye to you. Generally, by the time you find out about this you’re so close to arbitration that you won’t even stand a chance then. So you WILL lose.

In a nutshell…

These firms can seem like a good option, but only if you earn a lot, have a good case, and have an employer who will roll over.

Further, generally you will not be allowed to contact your lawyers to give them evidence on your case. Even emailing them will attract a fee.

And if they say it is ‘free’ that is false – you will be billed.

Conclusion: if you have the money rather hire a lawyer, or consider representing yourself. You know your case best – After all, it is YOUR life.

Note: BBB L is not the actual name of the firm whose contract we quoted


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