Why Law Firms Should Rethink the Engagement Agreement

Why Law Firms Should Rethink the Engagement Agreement

According to an Attorney at Work article by Jared D. Correia, CEO of Red Cave Law Firm Consulting, many attorneys treat engagement agreements as a formality, relying on outdated templates or boilerplate language. However, these documents are far more than administrative niceties; they represent an underutilized opportunity to define the attorney-client relationship, set clear expectations, and prevent misunderstandings down the line.

Too often, Correia says, lawyers avoid drafting robust engagement agreements because it takes effort, requires difficult conversations, or seems unnecessary when nothing has gone wrong. But that logic runs counter to the legal profession’s very DNA, which is built around anticipating worst-case scenarios. Taking a proactive approach to engagement agreements aligns with how lawyers advise their clients and can lead to more stable and productive relationships.

The article highlights some key upgrades that can make these documents more meaningful. 

• A technology use provision helps both parties understand the tools involved in a case, including data security and the use (or non-use) of artificial intelligence (AI).
• An evergreen retainer clause ensures firms don’t end up chasing invoices, establishing a predictable revenue stream. 
• File disposition terms address what happens to client documents after representation, reducing storage headaches and clarifying expectations from the outset.
• A clearly defined scope of representation avoids confusion, especially in limited-scope engagements. 
• And communication guidelines can help manage client expectations, reducing the strain of constant, ad hoc contact.

In short, a modern engagement agreement is a cornerstone of effective practice management. For managing partners, encouraging your lawyers to invest time in crafting thoughtful, comprehensive agreements will pay dividends in reduced risk, smoother operations, and stronger client relationships. Engagement agreements are more than paperwork—they’re a blueprint for successful representation.