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What is a Retainer Agreement?

A retainer agreement is a work-for-hire legal document or a service contract between a company or an individual and a client. It falls between a one-off-contract and a permanent employment contract. It allows clients and customers to pay in advance for professional services of a company or individual.

You can read more on retainer agreements here.

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Purpose of Retainer Agreements

The purpose of the retainer agreement is to set out the duties of the parties so that all parties have an agreement on the services that will be provided, how they will be provided, when and at what cost. Retainer agreements are typically used to hire lawyers and freelancers, although they may also be used for consultants, accountants, and other professionals.

The retainer fee ensures that the hired service provider reserves time for the client in the future when there is a need for their services. Unlike a one-time contract, a retainer agreement is a long-term work-for-hire contract and thus can retain ongoing services.

Here more on uses of a retainer agreement.

How Retainer Agreements Work

Retainer agreements do not work on a single formula. However, there is a basic structure followed in all retainer agreements. One party, like a contractor, agrees to provide certain number of hours or certain deliverables each month to the client. In exchange for locking in those hours or deliverables, the client pays a certain amount of fee, called the retainer fee, in advance to the contractor. Once the work is complete, the retainer fee applies to what the contractor is owed, and other hours will be billed at the contractor’s set rate.

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Advantages of Retainer Agreements

Retainer agreements are gaining popularity as service industries need more income stability and try to improve client relationships. Retainer agreements are widely used for legal services, consulting services, accounting services and by freelancers. Here are some benefits of using a retainer agreement:

  • Stability: A one-off contract might not bring stable income to an individual or company that is offering its services. However, a fixed retainer fee associated with a retainer agreement ensures stability.
  • Time Saved on Marketing: Given that freelancers and professionals would need to look for other clients after a one-off contract ends, marketing commitments are high in a one-off contract for the professional. In a stable retainer agreement, they benefit from a stable fee from the client and a long-term relationship with the client. Thus, they do not have to spend more time marketing themselves.
  • Improved relationships: A retainer agreement is a long-term professional relationship. It ensures that the professional is available when needed by the client. This ensures a long-term partnership.
  • Predictable Cash flow: Since retainers use an agreed upon retainer fee over a long period of time, it also makes it easier to estimate and maintain cash flows.
  • Improved Work: With a retainer agreement, a professional Is paid on a continuous basis, allowing them to focus entirely on the clients’ needs and produce high quality work.

Disadvantages of Retainer Agreements

Retainers come with multiple benefits. Most freelancers and companies would agree that its benefits outweigh the drawbacks. However, there are drawbacks to a retainer agreement for both the client and the professional. Some of them are discussed below:

  • Time: A retainer agreement the professional commits to a certain number of hours to the client. This means that they are being locked into a specific schedule.
  • Opportunity: Being locked into a specific schedule means that the professional might have to pass on exciting opportunities that might come their way.
  • Risk: For a client, retainer agreements can pose some risks. The client pays for the services before receiving them. In months where services are not needed, the client still pays for the hours agreed upon, thus losing money.

Here more on risks and benefits of a retainer agreement.

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Who Needs a Retainer Agreement?

A retainer agreement is widely used in the legal field. It is common for people seeking legal services or anticipating needing legal services to pay a retainer fee to a lawyer who will be available when they need them. This retainer can be an advanced payment for a monthly recurring payment to the lawyer.

Retainer agreements are also used by consultants to provide services to a client over a long-period of time. Especially when the client and professional have established a relationship and the client predicts needing the consultant’s expertise, a retainer agreement provides access to the consultant’s time and services. Freelancers also find retainer agreements to be beneficial. Freelancers often struggle to find a stable source of income and a predictable cash flow. A retainer agreement is a great way to ensure that they have a stable income over a long period of time.

Are you planning to sign a retainer agreement? Here are some things you should consider.

Types of Professional Services Retainer Agreements

There are two types of retainer agreements that a company or individual can use:

  1. Pay-for-work retainers: Pay-for-work retainers are often used by companies and professionals that intend to receive ongoing payment on a monthly basis from their clients. This type of a retainer agreement is used when relationships with clients is slightly underway. Companies or professionals get paid for the hours of the work they provide. Pay-for-work retainers are not much different from a contract. However, unlike a one-off contract, professions under pay-for-work retainers are in a loop to deliver services to the client over a long period of time.
  2. Pay-for-access retainers: When companies and professionals prefer to get paid for making their expertise and knowledge available to clients, they use pay-for-access retainers. Under this, the client retains the profession on an ongoing basis when services are needed. This is generally used when the client has formed a relationship with the professional and trusts them to deliver high-quality services whenever required.

Here more on types of a retainer agreement.

Getting Help with a Retainer Agreement

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ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.


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Libby Jamison founded E. Grace Law Firm after nearly two decades practicing law across federal agencies, private firms, and nonprofit organizations. She has advised at the highest levels of government and built a career defined by tackling complex, high-stakes legal and policy challenges. Her practice focuses on business, employment, veteran, and family law matters, drawing on her wide scope of experience including nearly seven years as counsel at the Department of Veterans Affairs. Her legal experience spans federal agency counsel, firm ownership, and nonprofit work. She is licensed to practice in California and Washington and was admitted to the U.S. Supreme Court. Beyond legal practice, she has led as a nonprofit president, chaired a U.S. Chamber of Commerce economic empowerment zone, and served on an American Bar Association Standing Committee on Legal Assistance for Military Personnel. Her work has been recognized by: Mighty 25 Awardee (2023) Changemaker of the Year, Military.com (2019) Bush Institute Stand-To Veteran Leadership Scholar (2019)

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Allen L.

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Clear, strategic legal guidance when you need it most—whether you're planning ahead or defending a position. Legal challenges shouldn't feel confusing or overwhelming. Whether you're building an estate plan, structuring a business, or navigating a dispute, my practice is built on clarity, care, and practical strategy. I work with clients who want real solutions—not just paperwork—through planning and advice that truly fits their goals, families, and businesses. Planning & Structure I focus on estate planning, asset protection, and business succession, helping individuals and entrepreneurs organize their assets, reduce risk, and prepare for every stage of life. Whether you're setting up your first living trust, shielding your business from liability, or updating an existing estate plan, you'll receive clear guidance, fixed-fee pricing, and responsive support from start to finish. Each plan I design is tailored to your real-world priorities: preserving wealth, avoiding unnecessary taxes and probate, and ensuring the people you love are protected when it matters most. Disputes & Defense When legal conflicts arise—disputed contracts, demand letters, settlement negotiations, or litigation decisions—I provide realistic risk assessment and strategic guidance. I help clients understand their actual exposure (not just best-case scenarios), identify leverage points, and navigate toward efficient resolution. If you're facing a legal claim or need to evaluate your position before responding, I can walk you through the realistic options and their costs. Services: Estate Planning & Asset Protection --Simple wills and powers of attorney --Living trusts for small estates --Buy-sell agreements for family businesses Business Formation & Agreements --LLC or S-Corp formation filings --Operating Agreements / Shareholder Agreements --Founder or Investor Agreements --Bylaws and Minutes templates --Registered agent setup guidance Contracts & Commercial Matters --Service Agreements (consulting, marketing, software, design, etc.) --Independent Contractor Agreements --Employment contracts and offer letters --Non-compete, non-solicitation, or confidentiality agreements --Employee handbooks or HR policy updates --Termination or severance agreements --NDAs (Non-Disclosure Agreements) --Partnership or Joint Venture Agreements --Sales or Vendor Contracts --Licensing or IP Agreements Terms and conditions SaaS Platforms --Terms of Service --Privacy Policy --Independent Contractor Agreements --Customer/User Agreements --Liability Waivers --Cancellation & Refund Policy --Non-Solicitation Clauses --Marketplace compliance documents Real Estate --Commercial lease drafting or review --Residential lease review --Purchase & sale agreements --Short-term rental (Airbnb) contracts --Property management agreements Professional Approach: I leverage modern legal research and writing technologies—including AI-assisted tools—to enhance the quality, speed, and clarity of my analysis. Like many legal professionals today, I use these tools to organize research, improve communication, and catch errors. Every analysis I provide is thoroughly reviewed and reflects my independent professional judgment as a licensed attorney. AI is a tool that supports my work; it does not replace it.

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Litigation

Retainer Agreement

Maryland

Asked on Jul 5, 2022

either in a flat fee or with a retainer, do attorneys charge for wait time in court/travel time to and from?

Have a protective order hearing coming up. I have the option of using a lawyer with no retainer agreement, but a deposit and an hourly rate or one with a retainer deposit and an agreement. In either case, is wait time in court charged at the hourly rate?how about travel time?

Michael T.

Answered Jul 19, 2022

Generally speaking, we charge for all time spent on a file. If I'm away from my desk for your case, then I can't work on other cases. So, yes, a five-minute hearing in court might result in a two-hour bill, because that was two hours dedicated to your case. That's why lawyers like to schedule multiple cases for the same hearing: we can pro-rate the travel and waiting time over multiple cases. Flat fees do not normally get a charge for travel or waiting time, because that time is included in the flat fee. A lot of judges start their hearings by "calling the docket" (bringing up each case one by one) and getting time estimates; then calling the cases beginning with the shortest time estimates. Some judges leave all the cases without lawyers to the end. This results in (A) the people involved in cases without lawyers see how it's done; and (B) the lawyers spend less time sitting around waiting and go back to being productive.

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Business Contracts

Retainer Agreement

Washington

Asked on Nov 4, 2024

What are the key elements that should be included in a retainer agreement?

I am in the process of hiring a lawyer to handle a complex legal matter and they have asked me to sign a retainer agreement. I am not familiar with the specifics of a retainer agreement and want to ensure that I understand the key elements that should be included in such an agreement. I want to make sure that my rights and interests are protected, that the scope of work is clearly defined, and that the fees and billing terms are fair and transparent.

Merry K.

Answered Nov 22, 2024

That is an excellent question, and I wish more people asked. Every attorney writes these differently, but, like all contracts, retainer agreements are usually written to benefit the author, and it's often difficult to negotiate changes. For a very large and costly project, please consider paying either a contracts attorney or an ethics attorney for an hour or two of his or her time to review the proposed retainer before you sign, and perhaps help you negotiate it. One of the things to look for is (are) hidden costs - for example, will the law firm charge you $36 every time they write a one sentence response to an email question you may have? Will you or they be paying for experts - if so, who will be used, and will you have any say in their selection? How much will the experts charge? (EG - a doctor in a personal injury case could charge $1500/hour). Does the retainer include language regarding how disputes between you and the law firm will be resolved? Does the retainer fully comply with the Washington State Rules for Professional Responsibility? https://www.courts.wa.gov/court_rules/?fa=court_rules.list&group=ga&set=RPC (Please note - the court website system has been having technical problems - in addition to the rules, there are also innumerable opinions interpreting the rules - only a true ethics attorney will be on top of all of these).

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Business Contracts

Retainer Agreement

Washington

Asked on Dec 18, 2024

Can a lawyer increase the retainer fee outlined in the retainer agreement after the agreement has been signed?

I recently hired a lawyer to represent me in a legal matter, and we entered into a retainer agreement that outlined the scope of the representation and the retainer fee required. However, after a few weeks, the lawyer informed me that they would be increasing the retainer fee due to unexpected complexities in my case. I am wondering if this is permissible under the retainer agreement, or if I have any rights to challenge this increase and continue with the original agreed-upon fee.

Merry K.

Answered Dec 27, 2024

Thank you for your question. The answer is going to sound a bit vague, but a retainer agreement is a type of contract - like any contract, the answer depends on the terms of the agreement itself. Please read the agreement very carefully, and see whether or not an increase in the retainer is allowed or not under the terms of the agreement as written. Also, please note that most often, a retainer is simply a down payment on hourly fees that will be charged - if that's the case, the attorney will have more flexibility in asking you to pay in advance. If, on the other hand, you are being charged a flat fee for a service, the attorney may have less flexibility in changing the terms. I suggest that you carefully read through this page of information from the Washington State Bar Association for additional information: https://www.wsba.org/for-the-public/concerns-about-a-lawyer

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Recent Project:
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Bid Range: $1,000 - $3,400

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Bid Range: $200 - $999

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