The opportunities for CILEX Lawyers to market their services differently are expanding fast amid the emergence of alternatives to traditional law firms, boosted by technological advances.

One such option is the fee-sharing firm, where self-employed lawyers work under the umbrella of a law firm (usually but not always regulated). The business takes care of the administrative aspects of running a practice and provides lawyers with support in areas such as marketing and HR so that they can focus on legal work in return for a percentage of the fees the lawyer generates, which can be anywhere between 10% and 40%, depending on the firm.

Almost all of these firms operate a remote model, with a central administrative hub and maybe office space in various cities, but allowing the lawyers to work as, when and where they want.

The trend has been growing rapidly, with estimates last year suggesting fee-sharing firms employ almost 3,000 lawyers and predictions that a quarter of all lawyers could work for firms like these in the coming years. While the recent rate of growth slowed somewhat as Covid encouraged traditional firms to embrace homeworking, there is every likelihood the fee-sharing model will continue to grow in popularity.

This revenue-splitting model is not going to be suitable for everyone, because like any independent practice it requires you to bring in a steady stream of work. But if you can achieve it, potentially big rewards await, including an excellent work-life balance, equality with your fellow consultant lawyers and a bigger share of the income you bring in. The CILEX members who have already made the move could hardly speak more highly of what it has done for them.

The new wave

Businesses operating this model range from traditional law firms to those founded specifically to promote fee-sharing. Some embrace entrepreneurial lawyers with less experience and others are aimed at more experienced corporate lawyers with established practices. Some also have international ambitions.

In September 2022, there were 35 consultant-led firms, with market leaders Setfords and Keystone Law both with more than 400 consultants, followed by Taylor Rose MW and gunnercooke, with 353 and 296 respectively. Keystone, which is listed on the London Stock Exchange, is a pioneer in this field and also operates ‘pods’, in which principals employ their own lawyers to assist them. Keystone itself also employs junior lawyers that partners can call on for support.

One large consultant-led practice with global ambitions, Spencer West, has some 150 partners and offices throughout the UK, Europe and the rest of the world, from the Middle East and Pakistan to South Africa. As well as recently acquiring a firm – which is rather unusual in the fee-share world – it is in the process of opening offices in Hong Kong and Singapore and its aim is to use fee-sharing to create a firm where “lawyers are empowered to work collaboratively and flexibly anywhere in the world, coming together as one”.

“If you’re a consultant working on a fee-sharing basis, you’ve got to be able to bring in your own work” 

The reasons why fee-sharing is so popular among the CILEX Lawyers who have done it seem to vary. Terms they use include ‘flexibility’, ‘autonomy’, ‘equality with solicitors’, ‘control’ and ‘rewards’. Some also urge caution, emphasising ‘risk’ and ‘time commitment’.

Chartered Legal Executive Gail Cook, a consultant at Richard Nelson in Nottingham, has worked as a family lawyer for some 40 years, and says that, before recommending fee-sharing to other CILEX members, she always warns: “They really need to have a source of work. Because if you’re a consultant working on a fee-sharing basis, you’ve got to be able to bring your own work and you can’t rely on the company that you’re consulting for to give you enough work to keep you going.”

Enjoying autonomy

A CILEX member who enjoys the autonomy of the fee-sharing model, but without some of the financial pressure of being a principal, is personal estate planning specialist Dominic Maher, who qualified as a Chartered Legal Executive quite recently. For almost two years he has worked as an associate to a solicitor consultant in a Keystone Law pod. The solicitor, Robert Knight, who delivers work to clients under contract to Keystone, supervises him according to the requirements of the Solicitors Regulation Authority.

Mr Maher generally works with Mr Knight on his matters, but he also has clients of his own which the two have agreed on. Explaining how his situation differs from a Chartered Legal Executive working under a solicitor at a conventional firm, he says: “Day-to-day it feels like there is less administration, in the sense that when you’re working in a traditional firm you might be focusing on the firm as a whole, whereas we are just focusing on our clients. So I feel that I spend more time delivering client work than wider administration tasks.”

He adds that the fee-sharing model is particularly suitable for people who want to build their own practices and, if they have ambition, perhaps to become principals themselves in due course. In his own case, when he joined Keystone, he was not at the right stage of his career to do this.

Asked where he imagines himself in a decade, Mr Maher says: “Ten years is a long time but I would imagine that, if I carried on doing what I’m doing, then perhaps working under a fee arrangement either with Robert or standing solo. I would want to continue with the arrangement I have got, whether it’s with Keystone or another fee-sharing firm… If you went back to a traditional firm, there would be things about fee-sharing that you would miss.”

Building a following

At the other end of the experience spectrum is employment law specialist Matt Huggett, CILEX’s immediate past president and a partner at Carbon Law Partners. He is also a Fellow of the Chartered Institute of Personnel and Development. Carbon was founded by former City solicitor Michael Burne in 2014 and provides a platform for very experienced lawyers who wish to run their practices independently yet within a fee-sharing firm. They take home at least 70% of their earnings.

Working for a fee-sharing firm can bring freedom and opportunity

To run a business in this kind of high-end fee-sharing firm, you need confidence, says Mr Huggett. “It’s only really for experienced people who have built up a following, a practice of their own,” he says. “It allows you to branch off on your own, to do the sort of work that you want to do, to work with the clients that you want to work with. And do so in a way that removes the need for you to set up on your own.

“The disadvantage is that, although you get this sort of ultimate level of freedom and opportunity, you don’t have the security of a guaranteed monthly income. So naturally it puts you in a position where you are more vulnerable.”

The flip side, he explains, is that you also have the opportunity to earn more than you would have done before. “In a traditional employment relationship, if you are doing very well then it's the firm that takes the benefits of that, rather than you as the individual, whereas fee-sharing puts all of the focus on the on the individual. So if you succeed, then you can do very well.”

Mr Huggett believes Chartered Legal Executives have shown themselves likely to have the resilience and self-motivation necessary to succeed in the fee-sharing model: “Because of the way the majority of legal executives are qualified – through having to hold down a full-time job whilst undertaking all of the exams and qualifying in that way – they have shown a consistent amount of resilience and determination.

“Legal executives will already have demonstrated this to themselves. Whilst they might naturally have an element of caution towards fee-sharing, if they look at what they've achieved already and the drive and determination that they've exhibited and the circumstances in which they've achieved it, actually they are well placed to succeed in a fee-sharing model.”

Entrepreneurial spirit

A CILEX Lawyer who has shown exactly the entrepreneurial spirit and self-motivation needed to succeed in a different type of fee-sharing is Alec Hancock, a CILEX Advocate who has gone on to set up his own personal injury practice regulated by the Bar Standards Board, AJH Advocacy Limited in Truro, Cornwall. He specialises in personal injury cases worth £1,000-£25,000 where fixed costs mean advocacy fees are for the most part unattractive to qualified barristers.

He has undertaken litigation on a fee-sharing basis for the past five years. He does advocacy for law firms and says they are more open nowadays to fee-sharing instructions. It means they can do so while taking on little risk of incurring costs themselves. From his point of view, working on a ‘no win, no fee’ basis, he sacrifices income security for a better percentage when cases are successful.

A key consideration when becoming a consultant on a fee-sharing basis in 2018, within a year of qualifying as a Chartered Legal Executive, says Mr Hancock, was that he could devote time to giving a better service to clients: “I left employee work and became a consultant because I was working in an employed position in a personal injury law firm where I was required to run over 120 litigated files. I couldn't do justice to the clients by working at the level you need to, to ensure that you're progressing files correctly without being overwhelmed.”

Equal respect

Another entrepreneurial Chartered Legal Executive, Samuel Ogden, works as a property lawyer at several different fee-sharing firms. He used to do most of his work at Setfords, but now mainly practices out of Nexa Law and sometimes Taylor Rose MW and Keystone, as an associate in a pod. He became a CILEX Lawyer after passing the Bar Professional Training Course but, after marrying overseas, found that becoming a barrister was “impractical”. He spends half of the year in Mauritius, where he can work remotely and leads a pod of six people – two assistant conveyancers, two paralegals, a business development executive and a head of partnership.

He built up his practice at Setfords, which gave him a lot of work. “I nurtured my own relationships and built my own business. That’s one of the things I love about the [fee-sharing] consultancy model – that you’re not just being a lawyer, you’re being a businessperson as well. If you want to hire people in your pod, you’ve got to effectively become an employer as well as a lawyer.”

He describes Nexa Law as “the best example of a fee-sharing firm that supports entrepreneurial lawyers who want to build their own businesses within a regulated environment”, adding: “What I love is that as a CILEX Lawyer I am equally respected when compared to solicitor counterparts. The biggest difference with the consultancy model is that it actually allows you to feel like you are being appreciated and treated equally to solicitors. There is no distinction between CILEX consultants and the solicitor consultants.”

He would never return to traditional practice, he says. One of things he likes about Nexa is that its chief executive and other senior officers are accessible and supportive. “They deal with the bits that don’t make money for a firm; the compliance, the HR, the admin. It’s the closest thing to running your own practice in terms of what you do, but without the headache of niggly little things.”

“They don’t just offer you the day-to-day support to practice but they also give you marketing support and business development support”

Unlike traditional law firms where he has worked, he has access to a large team of support people at the end of a phone. Financially, Mr Ogden says, the fee-sharing model pays him “three, four, five times the salary of an employed lawyer at a high street firm”. He continues: “The earning potential is endless. You can earn as much as you want if you can bring the work in… the percentage split is the same regardless of whether you are two years qualified or 20 years qualified.”

Mr Ogden extols the benefits of joining a fee-share firm. “They don’t just offer you the day-to-day support to practice but they also give you marketing support and business development support. For example, the other day there was a course where Nexa paid for a speaker to come in and talk about how you market yourself on LinkedIn.”

Some lawyers may be hesitant but he urges them to give it a go: “I was a junior lawyer and I’d just qualified. I’d never run a practice before or been a manager before. I threw myself in at the deep end. It has paid off; I can’t even describe how great the last three years have been. I would absolutely advise CILEX Lawyers to just get stuck in.”

If you accept the uncertainty of needing to acquire a consistent source of work to achieve an income, Ms Cook concludes: “The lifestyle is brilliant because if you are self-employed, you do whatever you like. You can choose to do whatever hours you want to, saving the day off for when you want to. You can work in the evenings or on the weekends… You earn so much more money because you’re getting a share of the total fee, not just a small salary.”