Paralegals may not share directly in the fees a lawyer collects from a client. All lawyers are prohibited from sharing professional fees with nonlawyers. This prohibition extends to agreements between a lawyer and a nonlawyer to distribute the fee after it is earned.

This ethical rule is grounded in the preservation of the professional independence of the lawyer. When a nonlawyer has an interest in the outcome of a legal representation, the lawyer is no longer able to exercise completely independent judgment on behalf of the client. The limitation on the professional independence of the lawyer is the same whether the nonlawyer is an independent contractor, such as a private investigator, or an employee, such as a paralegal.

Because the rule against fee splitting is related to the representation of the client, it does not apply to a lawyer who wishes to share general law firm profits with a nonlawyer. Year-end bonuses are common in law firms and there is no ethical prohibition against allowing paralegals to share in the overall financial good fortune of the firm. The fee-splitting prohibition only bars the sharing of fees related to specific, identifiable client matters.