Law firms that grant paralegals performance-based bonuses tied to the amount of money the firm wins for its client could be in violation of Wisconsin’s ethical rules for attorneys.
The Office of Lawyer Regulation has alleged that veteran Milwaukee personal injury lawyer Joseph Weigel, of Weigel, Carlson, Blau & Clemons SC, violated Supreme Court rules by compensating a firm paralegal through a system that uses clients’ gross recoveries as a factor in calculating the bonus.
Weigel, 77, faces a possible 60-day suspension of his law license. He appealed the case, which included two other unrelated charges, Friday before the Supreme Court.
At the hearing, OLR attorney Paul Schwarzenbart argued the practice could put clients at risk of not getting the attention deserved on a case.
“There is potential incentivization of settlements,” he said, “to maximize bonuses.”
But in an interview, Weigel said the method of payment isn’t unethical and is simply a way to promote efficiency in the competitive field of personal injury law.
“Everybody has got an incentive program of some sort to get the work done and get it done right,” he said.
The OLR complaint alleges that Weigel’s paralegal Eleonor Voloshin receives two forms of improper bonus compensation beyond her base salary, which is approximately $7.50 per hour. Voloshin earns 30 cents per $1,000, or three-tenths of one percent, on the gross recoveries from personal injury cases she works on with the firm, according to the complaint. She also receives a quarterly bonus of $1,500, plus $250 per $1,000, or 25 percent, of the difference between the average quarterly gross recoveries from personal injury cases she works on and a weekly goal of $127,500 per week.
While the rule permits performance bonuses for paralegals, Schwarzenbart said the system Weigel used too closely resembles fee sharing, which is illegal.
“The problem is that it’s based on gross recovery,” he said. “The paralegal is getting a piece of the action that is part of the contingent fee.”
Veteran Milwaukee personal injury lawyer Angela Dentice, of Pitman, Kyle, Sicula & Dentice SC, said she has never heard of contingent-fee firms attaching employee bonuses to client recovery.
In her experience working with four different personal injury firms during her 22-year career, she said, performance bonuses to paralegals and other firm staff are given at the discretion of the partners.
“I don’t know of any incentive-based bonus programs,” Dentice said. “In my experience, bonuses given to paralegals are based on how the firm did in a particular year.”
Dentice declined to comment on Weigel’s case or whether she thought his system was unethical, but said it’s not a method she would use to award bonuses.
“This practice of trying to work through cases quickly and get them to a lawyer,” she said, “personally, I would never want to espouse, because I think it’s important for paralegals to do a thorough and complete job. Sometimes it’s done quickly, but other times it can take months or years.”
Weigel said no clients have complained about the compensation system and it doesn’t decrease attention paid to cases.
“I don’t see where there is any need to change,” he said. “I haven’t seen this problem arise or anyone be prosecuted for it.”
Incentive to take photos at an accident site, obtain medical records and request police reports in a timely manner are paralegal jobs that should be rewarded if done well, Weigel said.
“It isn’t a matter of getting cases resolved,” he said. “It’s a matter of preparing the cases properly.”
A decision from the court is expected later this term.