How to Set Up a Paralegal Practice

Paralegals are trained in the same way as solicitors are. They study the same areas of law and procedure and have the same level of experience. They cannot call themselves ‘solicitors’ or hold themselves out, such as infer that they are solicitors if they have not fulfilled the criteria laid down by the regulatory body, the SRA (Solicitors Regulation Authority), however, paralegals can set up their own practice. 

If you are planning to set up your own paralegal practice, delivering paralegal services direct to businesses and consumers, there are several issues to consider. 

Competency

Although you may feel you have the knowledge to perform certain legal tasks and offer advice and assistance, it is important you are able to provide evidence to back this up. Clients want to be sure that the person handling their (often delicate) legal issue is in fact competent to do so. 

Being able to show your qualifications and/or work experience to date will help give clients that comfort. Although it is not necessary to have a recognised qualification, it will certainly help. It will ensure you are fully informed, and it will give clients confidence too. Gaining an Ofqual recognised paralegal qualification will help to cement that experience and prove that you are competent to perform the work you are being asked to do.

There are various levels of qualifications and which one you choose will depend on how much experience you have. These qualifications start with an entry-level qualification which is the Level 3 Award in Paralegal Practice (2 units of study) to the Level 3 Certificate (4 units of study) and finally the Level 3 Diploma (6 units of study). There is also the Level 4 Diploma in Paralegal Studies (10 units of study) and the Level 7 Diploma in Paralegal Practice for those who already have gained a Law Degree (6 units of study).

Even if you do have a recognised qualification, it’s always best to keep your knowledge up to date (which you have to do if you have a NALP Licence to Practise) by completing CPD courses each year.

Demand

Before thinking about setting up on your own, you have to be sure that there is sufficient demand out there for your particular type of work. Failure to do so means that you will not succeed in having a sustainable business. This means that you must know your market. It is important to have experienced the area in which you wish to work and to understand the services clients may want from you: Who are your potential clients? Where will you find them? What services will they want? Can you fulfil that need? How much competition is there? How will you set yourself apart?

Ensuring you understand the market and the demand is key to building a profitable business.

Setting up the business 

With your professional membership and your Licence to Practise, should you incorporate your business straight away? I would say, no. The best way to test whether a business works is to commence as a sole trader. If it is successful enough after the first few years, then you could consider converting it to a limited company. However, it’s always best to get some independent financial advice from an accountant first in respect of the pros and cons of each type of business. 

For example, an issue to consider if you were to incorporate your business is the cost, as it involves the requirement to have accounts drafted each year by a chartered accountant. On the other hand, one of the advantages is that you will have limited liability if something goes wrong, so make sure you get the proper advice before starting up.

Marketing and PR

In order to ensure your business is sustainable there should be consistent, and ongoing marketing. This can range from Search Engine Optimisation (SEO) to ensure your website (and you really should have one) is found easily on any search engine, to PR activity involving the publication of articles written by you in relevant magazines and websites, which will really help to get your name and expertise known. 

What type of marketing you choose may well be determined by the kind of business you have (and want to have in the future) and what you like to do. Some people love posting on social media, others like to create webinars or newsletters, and some prefer to write articles. Networking is also a good option to get your name and business known; remember that while this can be very effective, it is a slow burner. 

You also need to decide whether to outsource to an expert, which in the first instance, is probably the best option as you can control the costs and it frees you up to do the work you will have grown to love – being a paralegal. 

Protection

Being a member of a professional body, such as the National Association for Licensed Paralegals (NALP) is another way to give you extra kudos and credibility, and your client’s confidence. It also offers both you, and them, protection.

Gaining a Licence to Practise from NALP, for example, shows that a level of due diligence has been performed to ascertain an individual’s experience and/or qualifications which have been thoroughly checked and scrutinised. In addition, the eligibility to gain a Licence to Practise requires the applicant to have PII (Professional Indemnity Insurance) and this gives any potential client confidence that you have the backup should there be an issue.

Should there be a grievance, NALP can act as an independent arbiter ensuring you are not the victim of vexatious complaints, while also helping to ensure that the reputation of the paralegal sector is properly protected.

Being a NALP member also offers you the opportunity to get support and advice from highly experienced individuals within the organisation about your practice and career. 

Amanda Hamilton is a patron of the National Association of Licensed Paralegals.