A common refrain I often hear from lawyers who ordered a Chinese translation for legal documents is that while the translation was incredibly expensive, the quality was immensely poor. In most cases, these lawyers had turned to so-called “full service” translation companies who provided great Spanish or French translations, yet failed spectacularly with Chinese. Despite the poor quality, clients typically end up paying around $800 an hour for the actual translation work, hidden in opaque fixed fee arrangements—a billing rate higher than what most American lawyers charge.
You may be wondering how I reached that astounding $800/hour figure. After all, these translators have zero overhead, mostly working from home on laptops and usually living in cities with cheap rent in developing countries. This is especially shocking since a typical law firm can hire an on-site translator with similar qualifications for just $50/hour. When tracing this figure, I start at the law firm placing the order with the translation company. Instead of seeking the advice of a Chinese translation expert, the lawyers typically contact the translation outsourcer directly—usually without providing any guidance or instructions for the temps carrying out the translation.
The firm hired by the lawyer is not even a staffing firm, but an outsourcer charging a rate of $.30/word to resell the project to a staffing firm. The outsourcing company simply searches its Vendor Database for Chinese-to-English legal translation and gets in touch with a staffing firm located in Wuhan, China. The file is then sent from the outsourcing company in New York to the staffing firm in Wuhan, who charges the outsourcer $.10USD/word. Next, the staffing firm digs through its database of temps, focusing on four priorities:
(1) Avoid customer complaints;
(2) Complete the translation within 24-48 hours;
(3) Maximize profit margins; and
(4) Maximize the volume of words translated per project manager.
The staffing firm uses an internal software system that looks for the cheapest translator who is “good enough” (no customer complaints) and completes the work “just in time” for it to be delivered. Notably missing from the system will be any objective measure of the accuracy of the translation. Chinese agencies only pay lip service to whether the translation is accurate. All they care about is whether you are auditing the translations yourself; if a customer does audit their translations, then they track complaints coming from this customer. The rates at which individual clients complain and which translators are the subjects of such complaints are the key performance indicators used when determining profitability. The staffing company’s goal, therefore, will be to determine your level of mistake tolerance and assign you the cheapest translator at that level of tolerance. Mistake tolerance is why I recommend lawyers use auditors even when working with outsourcers; this ensures that they are forced to provide you with better quality translations.
American law firms can generally tolerate mistranslations of 40% of the communicated meanings at a price of $.30 per word, with just $.013 /word going to the translator. The end result, as we will see, is that the company pays $800 for an hour of the translator’s time.
Reality Check
If you reflect on what you know to be reasonable and true from your own experience in any developed English-speaking country, whether it be America, Britain, Australia, or any other advanced English-speaking economy, you know that well-educated people with a good command of English do not come cheap. Moreover, Chinese translators typically fall into the category of skilled professionals with a mastery of the English language. If you browse Chinese translator profiles online, you will find that they themselves target the $30/hour rate and that the same staffing firms offer such rates for hourly projects.
The people who work in fast-food restaurants for minimum wage are not the type of professionals you would turn to for expertise on a high-stakes project. Yet, that is precisely the kind of fantasy that many translation companies sell for Chinese legal translation. Honest, hardworking Chinese translators can consistently achieve approximately just 250 words per hour of translation, which may seem very slow, yet is perfectly normal considering the difficulty of translating Chinese to English. At the $0.013/word rate, they would be making around $3.25 per hour if they did the work honestly—a fraction of what even unskilled laborers are earning in China these days.
The reality is that just like in many other professions in China, some Chinese translators have chosen to work dishonestly to make up for the low rates. In practice, these translators target $30/hour, and, since they are working on a fixed rate, use machine translation tools to speed up their work by a factor of about 10 times. Rather than translating 250 words per hour as they would for any discerning and well-paying client, they instead aim for closer to 2700 words per hour. They simply paste in translations from a machine translator and look for anything egregiously wrong, plugging any obvious holes that would expose what they have done. The translator then pockets $35 for the hour of work it took them to translate 2,700 words. A lawyer should be on notice that anyone working at one to two cents per word on such a difficult task is relying almost entirely on platforms like Google Translate, however many lawyers still fail to perform such due diligence on their Chinese translation providers for the sole reason that it does not constitute billable work.
The translator in China sends out the file at about .01USD per word, while still making $30/hour. The staffing agency in Wuhan, China, then sends the completed file, without reading it, to the New York translation outsourcer with an invoice for $270 at their $0.10/word translation rate, along with dozens of other files from other translators doing the exact same thing. The sales and marketing team that landed the project takes a 25% commission, and the rest goes to overhead and project manager salaries, leaving a 22% overall profit margin for the project.
The translation outsourcing company in New York then receives the file in its automated system and marks the 2700 word project up to $810 at their $0.30/word rate. At this level, the same 25% sales commission applies to the project. Factoring in New York’s expensive office rent and overhead, that still leaves a 20% overall profit margin for this very successful translation company. For that one hour of work, the end client is charged $810—which is indeed what great lawyers, consultants, and accountants in New York can charge per hour. However, unlike those professionals, the translator is hardly taking a moment to glance at their own work—they must complete the translation incredibly quickly. For those professionals, any mistakes the translators make cost billable time, meaning the true cost of the translation is far higher than the invoiced cost.
The sorry state of outsourcing motivated me to put together an animation of a Chinese contract translation being typed into a bilingual document on the CBLtranslations.com homepage; it tells you that we do the work ourselves, know how it was performed and that you can depend on us. A comparable demonstration of what outsourcers do would be typing up an e-mail to someone in India or China saying, “please handle, thanks.” Lawyers relying on a translation error rate of 40% wind up committing serious malpractice. Consider the following serious cases that have made the news, which I have also verified with industry and official sources:
-A dairy company’s failed due diligence led it to poison Chinese children with melamine-laced milk;
– A pharmaceutical company’s failed legal compliance process landed dozens of Chinese employees and a British chief executive in jail, along with several billion Yuan in fines;
– The US DOJ accused an American General Counsel of fraud and obstruction of justice over a “misleading” internal investigation report written in reliance on Chinese translation.
In each of these failures, the $800/hour translator providing 40% error rates caused a legal catastrophe for lawyers, executives, and corporate boards. Who takes the blame in these cases? The above executives and lawyers were negligent, and the reason is negligent hiring: they hired temps to do a professional’s work. They were taken for a ride by salespeople who told a story too good to be true: that untrained temporary employees could and would give them the same level of professional service as an expert. In many of these cases, these were professionals in fields like engineering, finance, and law who absolutely knew that the temporary employees provided by staffing firms didn’t provide the professional services they needed, but they engaged them anyway. They chose them because it was the easy way out and they had better things to do.
Suppose for a minute that you really did want to go and hold this translator accountable. You’d be laughed out of court. In reality, you are playing a game of telephone with someone you are requesting professional services from. You relayed your needs to a vendor manager in New York who then paraphrased your needs to a vendor manager in Wuhan who then translated those needs into Chinese before throwing it at a freelance translator in Shenyang. There is no way you can be sure that those translators know what you need. In fact, the translators don’t even know what company placed the order and nor does the staffing firm. They rarely see anything other than the document to be translated. As far as they know, the translators are just helping Microsoft program its machine translation engine. Nobody mentioned that another person will ever read or use the documents. Therefore, they could reasonably assume that the translation is a purely academic exercise, that will never be used by anyone ever. Hiding the client’s identity as a lawyer gives translators a license to be negligent.
While translation errors have caused countless disasters in China and landed scores of business people in jail, no foreign company has ever succeeded in holding a translator in China legally accountable for what is frankly systemic negligence and fraud. At the end of the day, you are the sole person responsible for choosing qualified professionals to provide you with the advice and service upon which you rely.
How to Avoid the Problem?
Falsified translations are common. The best way to protect yourself is to educate yourself to be a professional that is well-prepared to engage with China. I have written at length in my e-book about how to identify the different types of translation providers. Here, I want to emphasize that you need to find a person—a real person—who possesses the following three attributes:
(1) A reputation to maintain;
(2) Credentialed by the American Translators Association or Chartered Institute of Linguists;
(3) Commitment to the organization’s ethics requirements.
These three attributes are essential. A translator who invests in their personal brand has proven skills and must follow ethics rules under threat of sanction by the translators’ association is not someone who is going to cheat you. They will always be honest with you about their skills and translation work product.
Finally, estimate how much an honest translator could expect to earn. Multiply the amount the provider pays its translators by 200-250 words per hour to determine how much can be earned without fraud. For example, if translators are being paid 10 cents per word, that’s less than what a legal secretary makes in New York or California, yet they are expected to render a specialized, professional service.
Conclusion
The Chinese translation industry is relatively unique due to the massive difference between what translation outsourcers charge and what is ultimately paid to the translators—creating a 3,000% markup. While very little is spent on the translation itself, the true cost of the translation, in terms of errors damaging the client, can be enormous.
Learn More: How do I identify my Chinese translation provider’s business model?
