There comes a time in the mediator’s relationship with clients – generally very early on at the first short screening/informational telephone call – when the topic of money comes up. I’m not referring our clients’ own money issues, which are often at the basis of their struggles, but rather, the topic of how and when the mediator will get paid.
As professionals, we generally let the prospective clients know on that first phone call what our billable rate is, how time is prorated and whether there is a minimum charge per contact. The timing of the payment for professional services would be next on the administrative agenda as well as whether we would require a retainer payment for future services, and if so, how much would be required.
I know mediators who present a bill after each mediation session, but that brings the monetary transaction between client and mediator front and center after each session. Mediation takes time. It requires exactly the amount of time it needs to make it successful, no more and no less. Having the end of each session focus on the fee puts the emphasis where it should not be. It interferes with the professional relationship between mediator and the mediation clients.
The professional relationship should be pure, and not centered around a monetary transaction. That’s why retainers are important.
For most mediations, having the financial relationship between the mediator and the clients prepaid through a retainer can be a very strong impetus towards making the mediation process stronger and more effective. Here’s why:
1. Retainers foster commitment to the process.
Mediations take time. Things need to settle. Choices, options and brainstorming don’t generally happen all in one session. We know in general terms by past experiences how much of our time a particular mediation case may take, after we hear the basic facts during the screening process.
Factors such as the type of case — divorce, whether there are children, trusts, businesses, and in prenuptial agreement mediation, whether there are children from previous marriages – all of these are factors that can give us a sense of how much of our time and a range of how many sessions the mediation might entail. This means that estimating the retainer required to provide payment to complete the case is possible. My mediation and fee agreement provides that if the mediation costs more than the retainer, I would then request an additional retainer “in a reasonable amount,” and if less, I would refund the unused amount to the clients.
Once that’s done, clients can forget about the monetary relationship between the mediator and themselves, and get to work on solving their problems and getting an agreement.
It’s a very different feel to start a mediation session that is prepaid for one or two hours. People will be thinking more about how much it costs, instead of trying to come to agreement and letting the process unfold. That can serve to short-change the mediation process and make it less effective, and therefore less valuable for the clients.
Mediation requires expansive thinking, which can sometimes take a good deal of time. Having the retainer paid lets clients be more relaxed with the process, and allows the mediation to take the time it needs to be successful. This way, the clients will be committed to the process instead of trying to cut it short.
2. Retainers cultivate professional boundaries.
Asking for (and receiving) a retainer sends the message to the clients that the mediator is a professional. Respect for the mediator’s professionalism is very important to the success of the mediation process. When the mediator is as uninvolved with the money transaction between mediator and clients as possible, the perception of mediator-as-professional is nurtured. I do not get involved with payment by the mediation clients, whether by check or credit card. It is handled by my staff.
A retainer takes the financial issue off the table quickly and efficiently. By briefly attending to the money part of the relationship in the very beginning, the focus is now on the task at hand – the mediation.
Another aspect of requiring a retainer is that it gives the clients the message that the mediator is in control. It is important for a successful mediation that the mediator has control of the mediation, even though in some respects, mediation is “client-driven.”
3. Retainers increase clients’ confidence in the mediator.
Asking for and receiving a retainer is a signal to the clients that you are confident that you will give your mediation clients value for their money. That helps your clients have confidence in you, which is important for the success of the mediation process. Confidence in the mediator’s skills can pave the way to a successful mediation. The flip side of this is that the mediator should be confident of the value they provide to the clients.
In a mediated divorce, one of my areas of mediation practice, the added value can include significant cost savings to the clients, not to mention minimizing the personal suffering that almost always accompanies divorce litigation. It can also include reducing or eliminating harm to the children of the marriage, whether they are youngsters or grown-ups. A couple experiencing a mediated divorce can look forward to participating happily together at future milestone events, such as graduations, weddings, and births of grandchildren.
4. Retainers promote mutual trust between the mediator and the mediation clients.
We mediators have been entrusted by our clients to help them address their sensitive confidential and private matters. Mediators help parties find their way through difficult transitions and problems. This is a great responsibility that we do not take lightly. By making the commitment to pay a retainer to the mediator before any services are provided, the client is taking a leap of faith in trusting the mediator. This trust can carry over into the mediation process itself. Our clients’ trust in us helps us to make the mediation successful for the clients.
5. Some practical advice about retainers.
Be very clear in your written Mediation and Fee Agreement what your rules are for calculating time spent on the work and the requirements of billing and payment.
Clearly state your billable rate and how you prorate time. Do you round up to five minute increments (I do) or do you charge by the minute? (The rationale for rounding up is generally that there is always some non-billable paperwork to do. Rounding down devalues our work.)
You can generally estimate the time a successful mediation might take and the number of sessions (at least a range of sessions likely needed) from your past experience in the type of case you’re handling. I suggest that the retainer amount correlate to your best estimate of time it will take to complete the job. This has the benefit of taking the commercial transaction between the mediator and the clients off the table for the entire mediation. That’s a good thing for the clients.
Give detailed bills for time spent between sessions. As to the mediation sessions themselves, I am accurate in my timing of each the mediation sessions, whether in person, or by phone, Skype or Facetime. But in the bill, I find it adequate just to say “Mediation Session.” I am very detailed and clear about the work I do between mediation sessions. I keep my time carefully for this non-session work, and provide detailed descriptions of what I’ve done in the billing. Being accurate fosters trust, which is important to the process.
Don’t be ashamed or hesitant in asking for (and requiring) a retainer. You work very hard to make a livelihood at this – you are a professional, and you deserve the right to get paid fairly. Remember the value added for the clients in the process as described above, in asking for and receiving a retainer. And, of course, aim to provide value in each mediation, in every session, and in everything you do for the clients, so the clients will be comfortable that their money is being used wisely.
In Fair v. Bakhtiari, 19 Cal.Rptr.3d 591 (Cal. Ct. App. 2004) the appellate course reversed the trial court's refusal to enforce a mediated settlement and compel arbitration pursuant to its...By James Coben