How does Kate get paid?
Ever notice how characters on TV have no day jobs but undending wealth?
I think about money when that character is creating expectations for how the public will someday pay people like, well, like me.
I want to check my understanding of what an actual California mediator would charge.
I would love your feedback!
Judging from the first show, she has three types of cases which I assume all have different fee structures:
- 1) Court-mandated,
- 2) Self-Referred, and
- 3) Firm Affiliated.
1) Court-Mandated Mediation: Court-mandated cases typically work like this: You do a training or practicum or basic 40-hour training with a mediation program and pay them about $500 and they give you a certificate. Then you do about 25 cases for a community mediation center or Small Claims Court. Then, once you feel you are ready, you apply to do limited and general jurisdiction cases with the court (in other words, cases with more moola and attorneys involved. $7,500 and up for limited cases, and $25,000 and up for general, last time I checked.). After you have done 25 pro bono cases with the court, then you get on a pay panel list.
(In my head, I always picture a list with 5 other names on it and we all get our turn. I think the reality is that this list has 10,000 names on it. I also think that as soon as your name comes up to be paid, people would rather turn to someone else who is doing their first 25 pro bono cases.)
Once you are on the pay panel and you are selected for a mediation, you enter the mediation with the parties and attorneys present. This mediation often takes place at the courthouse, but it can take place at a local dispute resolution center. Then you still mediate for FREE for the first 3 hours. After 3 hours, if everyone is willing, then you can begin charging $150 per hour (typically equally split amongst the parties, but I have occasionally made this point negotiable within the mediation). Occasionally a court-mandated mediation will go through a dispute resolution center or community mediation center. These often operate on a sliding fee scale and most of the money brought in goes into the overhead for running the center. I have worked at a few of these, and I think the most I received was $25 an hour. Most of my time at these was pro bono. Invaluable experience, but tough on my checkbook.
In other words, if this is your Get Rich Quick plan, don’t quit your day job.
2) Self-Referred: Self-referred cases are someone who calls the mediator directly without going through the court or a firm to hire the mediator. This means the mediator sets her own rates. She is often a private practitioner who does most of the scheduling and paperwork herself or with one part-time assistant. This mediator might charge anywhere from $100/hour in Country Bumpkintown to $10,000 per day in Beverly Hills. So a mediator’s fees per hour might initially be similar to a lawyer’s. But they begin to differ quickly because a) mediators typically resolve disputes in a lot less hours and b) mediators do not consider everything from opening an email to sending you a Christmas Card a billable hour. Instead (and again, I would love to get your feedback on this) most of the mediators that I have met with charge for time spent in actual mediation, occasional document prep work, and travel time if it is extensive. Most mediators also usually give a free initial consultation, and do not charge for sending a quick email or answering a quick phone call. So you can see that while a mediator and a lawyer might both charge $200/hr, at the end of a mediation you might pay a mediator $600 because you met with her 3 times for an hour each time. You might pay a lawyer $10,000 because, well, you sent too many emails in-between each mediation session.
3) Firm Affiliated: Kate Reed is still employed by Reed v. Reed. Many lawyers today are in that some boat where they have been employed at a law firm, and still partially work as a lawyer, but they are trying to make the transition to mediate more cases. These mediators are often still able to enjoy the benefits of working at a law firm:
- use of the conference room,
- having an assistant conduct client intake and oversee invoicing, and
- having cases brought to you by the firm.
Mediators working at a firm also have some drawbacks of working at a firm:
- their fees are determined by the firm;
- the money brought in from the mediation goes to the firm;
- they do not have as much flexibility in terms of time spent on a case, scheduling, meeting location, and creativity in agreements; and
- most lawyers connected with a firm are asked to report on the bottom line and the dollar amount involved instead of looking at the deeper, emotional issues.
For mediations connected with her firm, I would guess that Kate is charging about $400 per hour. I would also guess that the firm is still asking her to report on her billable hours, meaning that she needs to charge for every business lunch and every email sent out in connection with the case. Finally, I would guess that a lot of that money goes back into the firm (60% or so), but she still receives a pretty nice paycheck. After all, have you seen those shoes?!