Guides

What a paralegal actually costs: salary, on-costs and the alternatives

17 August 2026 · 6 minute read

General orientation for firms considering outsourced legal support, not legal advice. Rules change and every firm's position differs, so check the current text of anything referred to here and take your own advice before relying on it. Northbound Legal Ltd is not a law firm and is not authorised or regulated by the Solicitors Regulation Authority.

Ask a partner what a paralegal costs and you will usually get the salary. It is the wrong number, and the gap is not small. Salary is roughly two thirds of what the firm actually parts with, which means every build-or-buy comparison made against salary alone is being made against a figure that is out by about a third before anyone argues about quality.

This is not an argument that hiring is wrong. Plenty of firms should hire. It is an argument for comparing like with like.

What actually goes into the number

Take a paralegal on a £30,000 salary in England and Wales. The additional costs a firm carries fall into four groups.

Statutory and contractual on-costs

Employer National Insurance and the employer pension contribution are the unavoidable ones, and together they are the largest single addition to salary. Add whatever the firm offers beyond the statutory minimum, such as private medical cover, life assurance or enhanced leave, and the contractual layer grows further. Firms with a generous benefits package pay for it here.

Getting the person in the door

Agency fees for a paralegal placement commonly run to a meaningful percentage of first-year salary, and even a direct hire consumes partner and practice-manager time in shortlisting and interviewing that would otherwise be billable or spent managing files. Amortise that across an expected tenure and it is a real annual figure, not a one-off to be waved away.

The number people forget is the cost of getting it wrong. A hire who leaves inside a year, or who never reaches the standard, means paying the recruitment cost twice and absorbing months of supervision that produced little.

The desk around the person

Case management seat licences, practice management, document automation, e-signature, research subscriptions, hardware, a share of the office and its insurance. Individually small, collectively not, and almost never counted in a build-or-buy comparison because they arrive on different invoices from different budgets.

Time you pay for and do not get

Statutory holiday, bank holidays, sickness, training and the ramp-up period before a new paralegal is productive on your precedents. A firm pays for a full year and receives materially less than a full year of useful output, particularly in year one. Cover during absence is either bought in or absorbed by fee-earners doing paralegal work, which is the most expensive way a firm can process a bundle.

Where that lands

Add the four groups and a £30,000 salary is realistically closer to £40,000 a year in total cost, before you account for the productivity gap between the hours paid and the hours delivered. Firms that model this properly usually find the true hourly cost of a paralegal is a third higher than the figure they had been quoting internally.

The exact multiplier depends on the firm. A practice with cheap premises, low benefits and strong retention will be at the bottom of the range. One in central London with high turnover will be well above it. The point is to run the calculation with your own inputs rather than to adopt anyone else's.

The comparison firms actually face

Three options, and price is only one axis:

• Hire. Highest total cost and the longest commitment, but the person is yours, embedded in the culture and available for anything. Right when the workload is permanent and predictable.
• Contract or agency. Fast and flexible, usually the highest hourly rate, and continuity is weak. Right for a genuine spike with an end date.
• Outsourced seat. A fixed monthly fee for a named person, with the employment obligations, recruitment, absence cover and equipment sitting with the provider. Right when the work is steady but the firm cannot or does not want to carry a permanent head.

The honest difference is not only cost, it is where the risk sits. A hire converts a variable problem into a fixed obligation that is slow and unpleasant to reverse. A thirty-day arrangement leaves the firm able to change its mind. Firms that have been burned by a bad hire tend to price that optionality highly; firms that have not tend to ignore it entirely.

Our numbers, for comparison

We publish our prices in full rather than quoting on application. A dedicated full-time paralegal seat is £2,600 a month, which is roughly £15 an hour and about £31,000 a year with no employer National Insurance, no pension, no recruitment fee, no software licences and no unpaid absence. Part-time seats and qualified practitioner seats are on the pricing table.

Whether that is good value depends entirely on your charge-out rates and how much fee-earner time is currently going into work that does not need a fee-earner. That calculation is yours to run, and if the answer is that you should hire, you should hire.

Running it for your own firm

Take the salary you would actually offer. Add employer National Insurance and pension. Add benefits. Add recruitment cost divided by expected tenure in years. Add the annual software and equipment cost per head your practice manager can give you in five minutes. Divide by the hours you realistically expect after holiday, sickness and ramp-up rather than by 1,950. Then compare that hourly figure with the alternatives.

Most firms are surprised twice: once by how high the real number is, and again by how much of their fee-earners' time is going into work that sits well below their charge-out rate.