From interpreting contract language to settling disputes and claims, contractors often rely heavily on legal services, which can be expensive. How can CFMs obtain these essential services and stay within a budget?

Rethink Attorney Compensation 
Law firms traditionally charge by the hour. While high fees may not be an issue for some companies, it can cause hardships on others ­– to the point where they may avoid consulting with an attorney or forfeit asserting their legal rights altogether. Alternative compensation strategies can help lower legal costs by more closely aligning the company’s interests with those of its legal counsel. 

By aligning the interests of each party, alternative compensation strategies can satisfy both attorney and client: Clients typically save money upfront, and the attorney will assume some risk in exchange for potential upside. Let’s take a look at common alternative compensation arrangements.

Flat/Fixed Fee 
Under this approach, the attorney receives a one-time or periodic sum that covers all or part of a legal matter. CFMs favor this approach because it allows for some certainty with regard to costs. While attorneys assume the risk that the matter will involve more time and cost than budgeted, experienced attorneys will know how to set a reasonable fixed fee and efficiently reduce their costs.