If an individual doesn’t have the financial resources to pursue a legal case, they may not get the best possible outcome. For instance, it may be necessary to settle a case for less than what the plaintiff may deserve. It may also be necessary to forego a lawsuit altogether if an attorney cannot be convinced to take a case that may take months or years to resolve.
However, a representative for Burford Capital says that litigation financing could make it easier for a worker to pursue a civil case against an employer. Litigation financing companies provide the money needed to take action in a case and are repaid with a portion of the winnings. If the plaintiff loses the case, they are not required to repay the loan. Therefore, those who receive litigation financing are those who have a good chance of winning their cases.
Workers who have a small suit may benefit from litigation financing because the financing company would merge it with several similar suits. Therefore, each plaintiff may receive the resources that they need and may not otherwise have access to. Interest rates for litigation loans are similar to those charged by credit card companies, and they range from 12 percent to 19 percent on average.
Employees who have concerns about unpaid overtime or other wage claims may wish to speak to an attorney. The lawyer may be able to review the case to determine whether or not any laws have been violated. This may be done by looking at employee pay stubs, talking to witnesses or obtaining digital records that could confirm an employee’s story. If successful, a worker may be entitled to back pay and other compensation from the employer.