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Billing probe reveals in-house resentment

Rewarding Inefficiency In-house counsel are right to question the billable hour. Although it can be useful where there isn't a great deal of transactional certainty (meaning a fixed fee wouldn't be appropriate), there should be an open and ongoing dialogue with clients as to where fees stand. Lawyers should not shy away from the "difficult discussions" (if they feel they are truly adding value (which is recognised by clients), what is there to shy away from?), nor should clients turn a blind eye to fees, only to question fees once the deal is done. That said, the concept of the billable hour rewards inefficiency in so many ways. From many associates perspectives, inefficient working (by which I do not mean grossly inefficient or obviously inefficient) makes the drive to hit bonus related billable targets easie (particularly if they practice in an area where work flow has slowed). Similarly, why would a firm want to bill 9 hours when they could have billed 10? It's only when the inefficiency becomes glaring or obvious that questions are asked about inefficiency. In an enviroment where in-house legal departments are coming under increasing pressure to reduce their legal spend, they need to be billed on a basis that truly reflects the value of the work done - perhaps a combination of billable hours with a cap (presumably set on the basis of previous work/instructions), with amounts over the cap being billed at a reduced rate?

26-Sep-2007

10:57 am