Forget foreign countries. Don't expect the way things are done in U.S. has to be like that of foreign countries. Regarding real estate agents, they aren't actively publishing fee tables. They still may individually prefer to charge that because that has been what has been customarily charged all along for the past 100 years. The reason real estate agents charge the same fee for the most part is that when they work for a real estate business before going out on their own, that is what is charged and no one really thinks about lowering the fees because no one wants to deliberately earn less money for the same amount of work. This cycle has been going on by tradition.
They aren't competing to race to the bottom because R.E. agents are happy to earn what they can. They may charge a higher percentage if they can get their clients willing to pay it.
It isn't like they all are contractually bound by membership in a real estate to do so. What got AIA in trouble in the first place wasn't having a recommended fee table because I can list my price as anyone can and then everyone can decide for themselves what they want to charge. The problem isn't a fee table. It is REQUIRING members to charge such a fee. Whenever you see a competitor publish the price of services or goods, you have the choice either to charge more, less, or equal to. When AIA had price fee tables, the issue that got them sued by the U.S. DOJ after reports by disgruntled members of AIA for requiring AIA members to charge according to those fee tables. The issue is AIA is a professional organization (a group of members of the profession) and when acting as an organization, it is a conspiracy to price fix when the organization mandates its members to price fees. Sure, AIA membership is voluntary but AIA at the time also had other disciplinary actions including issuance of fines, de facto control of licensing boards as they still do have a much of that through its AIA members and when they have that and possible fear of retaliation of members leaving by AIA members singling out those members for even the slightest of mistakes and through the licensing boards using its power and influence to cause steep disciplinary fines,suspension or revocation of license, etc. It is will all this concern that raised the issue.
AIA's size and influence on a national scale of the architectural profession is another key factor arising to a nexus (legal term) sufficient to bring US DOJ into the matters as it rises to a national level with national level concern. If you and a group of fellow architects had conspire to price fix in a neighborhood, you likely won't see U.S. DOJ but your State DOJ may have issues with it.
As you may know, there is nothing STOPPING you from personally choosing to use fee tables from Canada as a reference or even old fee tables of AIA's that you may find through a little bit of google searching. There is nothing stopping 80% of the profession's member to independently for themselves choosing to follow any of these sources as a reference. Fee tables alone is not price fixing or necessarily conspiracy to price fix. As it is nothing more than choosing a price and publishing the price of goods or services. Anyone can do that and you see it all the time. What is important is that each of us have freedom to choose what we charge as we feel without feeling that I can face disciplinary action for choosing a different price.
AIA will not publish fee tables but their fee tables are still available to those who wishes to look at them. You can find the information if you look. Then it comes down to you independently deciding what you feel and value the worth of your services. Do you agree with 6% or do you feel it is too little or too much for the scope of work. (Rhetorical question and not a suggestion of price) You decide for yourself.
Remember, when you are sued, you are essentially losing rights because you have court orders to follow and in some cases, they restrain what you are allowed to do and you have to perpetually follow the court orders for eternity. AIA was by court order mandated that they are NEVER to publish fee tables ever again because of the abuse. While other organizations may publish them but because they didn't abuse or require its members to follow them and that they always made it clear that they are simply recommended prices or statistical average prices of leading firms and that prices listed may not reflect projects scope of work and therefore each member is free to deviate as they see fit.When it is clear with its membership that they are free to choose how much to charge a client, it is a non-issue. It maybe a technical violation of law but merely so does not necessarily raise it to a level that the state or U.S. DOJ will take you to court.
Many organizations have changed or responded by either removing fee tables or instead of fee table they do something similar to RS Means but for fees by statistical data on statistical means and averages of fees in different locations and performed independent of the profession members by statisticians collecting information from a number of firms and independent architects and designers. In which case, the data itself reflects the trend. So collecting such information every 5 years, and publishing a new edition can be enlightening. If we do it annually, all the better. The key is, this can not be AIA because they already been marked by the specter of U.S. DOJ. So an independent body of statisticians would be great to collect and publish data. It then is up to us to decide what to do with that information with our business. Then you are deciding for yourself if your fees are either too high, too low or otherwise and whether to change the fees or not, improve your marketability, etc.
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Richard Balkins, Assoc. AIA
Building Designer / owner
Richard W.C. Balkins, Building Designer
Astoria, OR
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Original Message:
Sent: 07-21-2015 14:35
From: Cary Westerbeck
Subject: No Discussion of Fees
Completely agree, Greg. I continue to wonder about this topic of setting fees and fee schedules. Why do real estate agents get away with set, expected percentages and we can't? In Canada, their organization has a schedule of typical fees for each project type, with many variables to consider. It's always surprising to me that U.S. architects are forbidden from producing such a helpful tool for architects. The schedule would simply be a guide, not a hard and fast schedule that must be followed; just a place to get some perspective and research for what fee is appropriate. I think the AIA is weak on this, and it does U.S. architects a huge disservice. This is one of the reasons I'm not an AIA member.
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Cary Westerbeck
Owner
westerbeck|architecture
Bothell, WA
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Original Message:
Sent: 07-18-2015 21:02
From: Gregory La Vardera
Subject: No Discussion of Fees
It seems that other organizations have found ways to communicate with their members about these important issues:
https://www.freelancersunion.org/blog/2014/08/18/everything-you-need-know-about-freelance-rates-pricing-and-fees/
Don't you think its time that the AIA question the total black out on discussion of fees, and fight for the right to have useful discussions.
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Gregory La Vardera
Gregory La Vardera Architect
Merchantville NJ
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Original Message:
Sent: 07-15-2015 11:13
From: Susan Parrish
Subject: No Discussion of Fees
This is a friendly reminder that any and all discussion surrounding fees violate the AIA Code of Conduct. Please refrain from posting such topics on AIA discussion forums.
Discussion Forum Etiquette
Avoid discussing specific fees. Do not encourage or direct users to arrive at any agreement that either expressly or impliedly leads to price fixing, a boycott of another's business, or other conduct intended to illegally restrict free trade. Posts that encourage or facilitate an agreement about the following subjects are prohibited: prices, discounts, or terms or conditions of sale; salaries; profits, profit margins, or cost data; market shares, sales territories, or markets; allocation of customers or territories; or selection, rejection, or termination of customers or suppliers.
Visit http://network.aia.org/codeofconduct for a bulleted list of the Code of Conduct.
Thank you.
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Susan Parrish
Director
The American Institute of Architects
Washington DC
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