A law firm in Birmingham recently claimed that hundreds of jobs could be lost in the West Midlands if the no win no fee reform plans go ahead.
DBS Law personal injury solicitors say that income for the industry could be reduced by as much as 25% and job losses would doubtless ensue.
Davy Bal, a director of the firm, has now written to local MPs asking them to pressure the coalition to reverse its decision.
In his letter, he explained that many Birmingham voters rely on the no win no fee system to obtain justice. He also pointed out that the region employs around 4,000 solicitors, plus many more administrative staff, and a lot of them could be made redundant if the reforms go ahead.
Richard O’Brien, a spokesman for DBS Law, said the no win no fee system has gone a long way to ensuring safety in the workplace and on our roads. If access to justice is reduced, local authorities could cut corners and more accidents will occur.
The government intends to change the law so that personal injury lawyers acting in no win no fee cases receive their “win” fee from the personal injury compensation awarded to the claimant. Currently, they receive a success fee, which is charged to the defendant, but the government feels this system does not encourage claimants or solicitors to keep their costs down because the client has a guarantee that he will not be liable for the costs.
A report from Lord Justice Jackson last year warned that fees were spiralling out of control and in some cases lawyers were receiving fees ten time higher than the compensation awarded to their clients.
Legal fees cost the NHS nearly half a billion pounds every year. In 2008-09, it paid £312 million in compensation and an additional £456 million for legal costs.