Guideline Hourly Rates 2024- An Update

 

 

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It was announced by Master of the Rolls, Sir Geoffrey Vos in December 2023 that the 2021 guideline hourly rates would be uplifted from 1st January 2024. This came following the recommendations of the Civil Justice Council Costs Review, published in May 2023. The new rates are now uplifted for inflation annually based on the Services Producer Price Index. The rates vary depending on the solicitor’s experience and the geographical area of practice.

Master of the Rolls, Sir Geoffrey Vos, chair of the Civil Justice Council and Head of Civil Justice stated the following:

“I want to thank the Deputy Head of Civil Justice, Lord Justice Birss, and his working group on what is a ground-breaking report. I am announcing today that I endorse all the recommendations and will be proceeding immediately to the implementation phase.

As is recommended, the 2021 Guideline Hourly Rates will be uplifted for inflation from 1 January 2024 in accordance with the Services Producer Price Index. I will establish, as the report suggests, a further working group to examine the methodology underpinning Guideline Hourly Rates.

As regards costs budgeting, I accept – “one size does not necessarily fit all”. I am today asking the Civil Procedure Rules Committee to take forward the suggestions contained in the Costs review to pilot what the Costs review suggests.”

The New Guideline Hourly Rates 2024

 

  • Grade A (Solicitors and legal executives with over 8 years’ experience): Rates range from £272 in National Band 2 to £546 in London 1.
  • Grade B (Solicitors and legal executives with over 4 years’ experience): Rates range from £233 in National Bands 1 and 2 to £371 in London 1.
  • Grade C (Other solicitors or legal executives and fee earners of equivalent experience): Rates range from £189 in National Band 2 to £288 in London 1.
  • Grade D (Trainee solicitors, paralegals, and other fee earners): Rates range from £134 in National Bands 1 and 2 to £198 in London 1.

These rates reflect a uniform percentage increase across all grades, with the average increase being approximately 6.62%. The highest rate is for high-level practitioners in central London (Grade A in London 1), which are not reserve for specific locations in London, but rather for “heavy commercial and corporate work” in the London area.  Given this specific definition given, and following the decision in Samsung Electronics Co Ltd & Ors v LG Display Co Ltd & Anor (Costs) [2022] EWCA Civ 466, justifying enhancement upon hourly rates will be more of an uphill struggle for Receiving Parties.

Rates are naturally lower for less experienced practitioners and those outside central London areas, but the margin of difference between National 1 and National 2 has lessened (and we predict they will be merged in the future, much like National 3 was removed from guidelines prior to 2007), likely to reflect the fact that location is becoming less and less of a factor when it comes to instructing a legal representative.

Deviation from guideline hourly rates

It is possible to deviate from the Guideline Hourly Rates in certain circumstances. The rates provide a framework or starting point for assessing costs in litigation. However, they are not absolute caps and can be adjusted based on the specifics of the case.

Several factors might justify departing from these rates, such as the complexity of the case, the specialisation required, the urgency of the matter, or the importance of the issues at stake.

Inflation is also an important factor, and certainly came into play in seeking enhancement on the 2010 guideline rates, before they were updated in 2021.  However, in relation to the guideline hourly rates 2024, inflation will be a limited factor to argue until such time as sufficient time has passed to have inflation data in support of any such submission, which at the earliest will be 2025.

Judges do however, have discretion to award higher or lower rates than those specified in the guidelines if justified by the circumstances of the case.

For instance, if a case requires specialised expertise not readily available at the suggested GHR, or if the matter is particularly complex or expedited, higher rates may be warranted. Conversely, for more straightforward tasks or cases that do not demand specialised skills, lower rates might be appropriate.

In practice, both parties in a legal matter can also negotiate rates that differ from the GHR, especially in commercial contexts where clients may agree to pay premium rates for services perceived as offering higher value. However, such agreements might not always influence the rates that can be recovered in costs assessments by the court, unless they fall within reasonable bounds of what is considered necessary for the case.

How Can ARC Costs Assist?

 

ARC Costs, as well as preparing documents, such as Bills of Costs and Costs Budgets, often handle negotiations during detailed assessment proceedings, and deal with disputes between parties in relation to the hourly rates being charged as part of any costs recovery.

Please note that the revised Guideline Hourly Rates 2024 remain guidelines only. A number of factors can be taken into account to allow for a higher rate to be claimed in costs, such the expertise of a Solicitor and the complexity of the case.

The issues of the hourly rates claimed in costs can be dealt with through Points of Dispute and Replies, with oral submissions sometimes being required at summary assessment and detailed assessment where a decision on the reasonableness of the rates claimed will be made by the costs judge.

As independent costs experts, we regularly act for paying and receiving parties, concerning the recoverability of costs. To discuss your costs query further, please contact us on 01204 397302 or email on of the team at info@arccosts.co.uk. Alternatively, you may complete our online enquiry form and we will contact you to discuss your query further.

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