what are lawyer billable hours

Billable hours are the lawyer hours that clients pay for directly. There are tasks that a lawyer does that is just part of the work needed to work at a law firm but then there are tasks that are directly related to the client’s case. Time spent on tasks directly related to a client’s case can be billed for the most part to the client.

Full Answer

How to maximize billable hours for attorneys?

 · The billable hour system is when a lawyer records how they spend every minute of their working day to calculate how they bill the client. It used to be the most common method of charging a client for the work of a lawyer.

How many hours works per week one lawyer?

 · Billable hours are the lawyer hours that clients pay for directly. There are tasks that a lawyer does that is just part of the work needed to work at a law firm but then there are tasks that are directly related to the client’s case. Time spent on tasks directly related to a client’s case can be billed for the most part to the client.

How to calculate attorney billable time?

Firms “average,” “target” or “minimum” stated billables typically range between 1700 and 2300, although informal networks often quote much higher numbers. The NALP Directory of Legal Employers (www.nalpdirectory.com) contains billable hour information in the “hour and lifestyle” tab, although many firms choose not to share their data.

What are the normal working hours for a lawyer?

 · It’s not uncommon for lawyers (especially Big Law attorneys) to work up to 80 hours each week. On average, according to the 2018 Legal Trends Report, full-time lawyers work 49.6 hours each week. Significantly, 75% of lawyers report often or always working outside of regular business hours, and 39% say this negatively affects their personal life.

How do you calculate billable hours for a lawyer?

Calculating billable hours is straightforward: you take how much you've worked and multiply it by your hourly rate.

What is a normal amount of billable hours?

It's not a complicated equation – the more hours you bill, the more revenue for the firm. Firms “average,” “target” or “minimum” stated billables typically range between 1700 and 2300, although informal networks often quote much higher numbers.

How hard is it to bill 2000 hours?

For example, if you want to reach a goal of 2,000 hours annually, you would need to bill for roughly 40 hours each week, or eight billable hours a day. You may not work exactly eight hours each day, but this breaks down what you should average in a day, week, and month to reach your annual goal.

Is 2400 billable hours a lot?

Assuming the billable hours are “on the up and up”, a 2400 hour/year biller is routinely working on client matters well past the dinner hour. In fact more than routine, as an absolute necessity a 2400 hour biller is working on legal issues every night after he has already worked eight full hours.

Is 3000 billable hours a lot?

Under normal circumstances, considering a 5-day workday week and that there are 52 weeks in a year, 3000 billable hours would mean logging 12 billable hours a day, and that would then entail working 14-16 hours a day, every day of the 5-day workday week, for all 52 weeks of the year. Not a pretty prospect.

How do you bill time in a law firm?

Unless someone told you otherwise, bill all the time you spend on a task, even if you know some of it will be marked down. At most firms, you will still get credit toward your billable hour goal for all the time you enter into the firm's billing software, even if not all of that time is billed to the client.

Do Lawyers work 9 5?

You can certainly work decent hours and earn a decent salary at City firms if you pick your firm and practice area carefully. IP is pretty much as close to 9-5 as you'll get in City practice, although it's probably closer to 9-7 in reality. Finance and M&A are the ones you have to watch out for in terms of hours.

Is 1950 billable hours a lot?

Combined with the non-billable requirements, I am very suspect that anyone really bills very high hours. Right. An honest 1950 is a lot of 60 hr. weeks including weekends.

What does 1800 billable hours look like?

To achieve 1,800 billable hours, an associate would work her “regular” hours plus an extra 20 minutes Monday through Friday, or work one Saturday each month from 10:00 a.m. until 5:00 p.m. The first option would give an attorney 1,832 billable hours, with a total of 2,430 hours spent “at work” (AKA: including ...

Is 2300 billable hours a lot?

Typical associate chargeable hours in mega firms and large firms are 2,000-2,100 per year. However, the typical associate who is “in the hunt” for partnership – an ambitious-prime-time-player – are likely to bill 2,300-2,400 hours per year.

What percentage of hours should be billable?

For most service companies, 30 percent is considered a good efficiency rate, while 50 percent would deliver extremely efficient employee costing. That means out of eight hours, if a technician does approximately 2.4 hours of billable work per day, the billable hour percentage averages 30 percent.

How many hours a month should I bill?

A realistic billable hours minimum I think, in a small-firm retail practice involving lots of clients getting billed each month, that you should expect a minimum of 100 hours per month (annualized) in billable work.

What percentage of hours should be billable?

For most service companies, 30 percent is considered a good efficiency rate, while 50 percent would deliver extremely efficient employee costing. That means out of eight hours, if a technician does approximately 2.4 hours of billable work per day, the billable hour percentage averages 30 percent.

How many hours a month should I bill?

A realistic billable hours minimum I think, in a small-firm retail practice involving lots of clients getting billed each month, that you should expect a minimum of 100 hours per month (annualized) in billable work.

How many billable hours are in a month?

168Monthly Working Hours CalendarMonthDates of HolidaysWorking Hours in MonthJanuary17168February21160March25184April16815 more rows

What does 1800 billable hours look like?

To achieve 1,800 billable hours, an associate would work her “regular” hours plus an extra 20 minutes Monday through Friday, or work one Saturday each month from 10:00 a.m. until 5:00 p.m. The first option would give an attorney 1,832 billable hours, with a total of 2,430 hours spent “at work” (AKA: including ...

What is billable hours?

Billable hours are the lawyer hours that clients pay for directly. There are tasks that a lawyer does that is just part of the work needed to work at a law firm but then there are tasks that are directly related to the client’s case. Time spent on tasks directly related to a client’s case can be billed for the most part to the client.

When lawyer work hours are tracked with legal billing and time tracking software, should they use very descriptive language on each entry?

When lawyer work hours are tracked with legal billing and time tracking software, they should use very descriptive language on each entry so that a non-lawyer can understand what work was done. When clients can see the details of the work done on their case there is less confusion and fewer billing disputes.

Why is billable hour important?

It’s important that law firms devise effective strategies for getting the most out of their billable hours while helping lawyers and clients understand just how law firms bill. December 18th, 2018.

Why is it important to have high quality time on a client case?

Increase quality but billable time on client cases. High quality time on a client case improves customer satisfaction and is profitable for the law firm because clients refer others and return when they need lawyer services in the future.

Why use billable hours chart?

Law firms can also use an attorney billable hours chart to see if there are any inefficiencies in the way associates are spending their time but there are limits to how much time any associate can squeeze out of a workday. If a law firm is tracking their time and maximizing their lawyers’ billable hours and they are still unable to turn a profit, they may need to examine other sources of their financial trouble such as a too low fee or too high cost of overhead.

When law firms are making their billable hours targets, do they need to consider their profitability?

When law firms are making their billable hours targets they need to consider their profitability but they also need to consider the practicality of demanding that lawyers work incredibly long hours as a standard instead of an exception.

What happens if you don't track your hours?

What You Don’t Track Gets Wasted. When it comes to billable hours, the failure to properly track lawyer work hours can result in wasted time and lost productivity. For lawyers who are working 70 or even 80 hours a week, it can become easy to forget how that time was spent and how much of that time really is billable hours. ...

How do law firms make money?

One important aspect of law firm life that is nearly impossible to avoid is the “billable hour.” Most law firms make their money by billing their clients by the hour. In order to be profitable to your firm, you must make enough money from your billable hours not only to cover your salary and your overhead, but also to generate revenue for the firm. It’s not a complicated equation – the more hours you bill, the more revenue for the firm.

What time do you work on a half hour commute?

With a half hour commute (to your desk and working) you are “working” from 7:30 am to 6:50 pm With a one hour commute you are “working” from 7:00 am to 7:20 pm, Monday - Friday

What are billable hours?

When law firms have minimum billable hours requirements, attorneys are required to work a minimum number of hours on billable client work. When these billable hours are combined with the hours spent on non-billable (but still essential) tasks like client intake, research, travel, and communication, it becomes difficult to do everything within a standard workday.

How many hours do lawyers work?

Most lawyers work more than 40 hours a week. It’s not uncommon for lawyers (especially Big Law attorneys) to work up to 80 hours each week. On average, according to the 2018 Legal Trends Report, full-time lawyers work 49.6 hours each week. Significantly, 75% of lawyers report often or always working outside of regular business hours, ...

How to help lawyers with mental health?

Practice mindfulness. As attorney and author Jeena Cho explains on the Daily Matters podcast, mindfulness and meditation can be powerful tools for supporting mental wellness for lawyers. If you need help tapping into mindfulness, you can also use technology to help, with many apps available to help you manage stress and prevent burnout.

How to manage lawyer anxiety?

Stay physically active. Moving your body with physical activity is an important factor when it comes to lawyer wellness and helping to manage anxiety. Prioritize downtime and time off. Rest is critical to keeping burnout at bay and sleep deprivation negatively impacts our health.

What are the mental health issues of lawyers?

Mental health issues. Lawyer anxiety, depression, and mental health problems are prevalent in the legal industry. The Hazelden Betty Ford Foundation study found that 28% of licensed, employed attorneys suffer from depression, and 19% deal with symptoms of anxiety.

Why is working so many hours not sustainable?

Also, the pressures and exhaustion that accompany long-term overwork can impact lawyers’ career paths and health. Some of the most common health issues fuelled by grueling lawyer hours include: Lawyer burnout.

How many lawyers work beyond business hours?

The majority of lawyers—77%, according to the 2018 Legal Trends Report—work beyond regular business hours to catch up on work that didn’t get completed during the day. Client service. Clients come first and that can impact lawyer working hours.

What is billable hours?

Billable hours are any hours worked that must be compensated. If you spend four hours balancing a client’s books, and you’re paid by the hour, you have four billable hours. However, you have to have a record of your time worked to bill that time to the client. And that’s just one step to recording and being paid for billable hours.

How many hours do you have to work to get 1,832 billable hours?

To achieve 1,832 billable hours, the associate would have to work 10 hours and 20 minutes a day, every day, for 47 weeks. To meet today’s industry average of 1,892 billable hours, an associate would have to add 60 more hours in the year. That’s around 15 more minutes of billable time a day, which culminates in an average workday ...

How to multiply billable hours?

Multiply your billable hours by your hourly rate.

What is a client meeting?

Attending meetings with the client or related to the client’s project.

Is work for yourself billable?

If a client is paying you per hour, any work you do on their behalf is considered billable. Any work you do for yourself, your business, or your team—unrelated to the client—is non-billable. Depending on your industry, here are a few tasks that may count as billable hours.

How long is a casework team meeting?

Attend a 30-minute team meeting about casework.

What time does a resume work?

Resume work on your client’s case, and work from 1 PM to 3:45 PM.

How many hours do lawyers bill?

In large firms, most lawyers are required to bill well over 2000-2200 hours per year , or about 167-183 per month. Keep in mind, this is just what they are expected to bill.

What happens if a lawyer charges more than one hour?

A lawyer who knowingly “pads” his hourly bill, charging for work not done, or work which was not relevant to the client’s case, or charging the full value of a certain piece of work that benefited two or more clients to BOTH of those clients (double dipping), or who charges more hours for a given project than he actually put into it, is very likely to be disbarred (removed from the roll of licensed attorneys), and may even be criminally prosecuted for fraud or theft, for doing so.

How do lawyers bill?

Most lawyers these days use one or another brand of computerized time-and-billing software which lets the lawyer easily enter the starting and stopping time of any particular activity — interrupted as often as necessary — and then automatically process it at the end of the billing period into a day-by-day itemization of what he did for that client, which day he did it, and how much time he spent on each item. This is a draft bill, of course, and a duly diligent attorney will check it over for mistakes, or for work which did not really turn out to be for the client’s benefit (there is often a lot of that) which in good conscience AND business goodwill ought to be cut out of the final bill, and so on. Also keep in mind that most of these programs allow for billing to be broken down into units no smaller than a tenth of an hour (six-minute increments) so if a job only took 3 minutes, the lawyer’s choice is either to bill for a full tenth of an hour (the minimum charge), or not to bill for it at all. Some lawyers make a point of telling the client this is how their system works, up front, regarding the minimum billing unit; that is perfectly acceptable even if it results in slightly more time being billed than strictly speaking was actually spent if one were counting it by the second.

What would happen if lawyers refused to pay their fees?

If people refused to pay lawyers’ fees as they are now (ie, reduced demand), sooner or later, some lawyers would lower their fees to attract new clients. If the number of available lawyers dried up (ie, reduced supply), sooner or later, some lawyers would raise their fees to be paid more for their work.

How many hours do you need to be a partner?

Most large, highly profitable firms—assuming they set billable targets—will require 2,000–2,100 billable hours as the minimum to stay in good standing, i.e., to receive a full year-end bonus and remain on track for partnership. The firms that don’t set targets generally aren’t doing so because they’re cool with associates billing 1,500 hours; rather, the hours at such shops are often so high that setting a floor would discourage people from doing more work. For example, if the stated minimum was 2,100 hours and you and several of your fellow associates were already at 2,600 in October, everyone might start looking at travel brochures, and there’s nothing that makes a partner sadder than idle associates (I’m tearing up just thinking about it). It’s therefore better to say that there is no minimum and hope that a few people try to hit 3,000.

Why is a quarter of an hour considered a minimum billing unit?

Often the minimum billing unit back then was a quarter of an hour (15 minutes) mainly because the transactional cost (time and effort) of breaking the time spent down into smaller units would not be economically worth it to the firm. Even then, though, lawyers would typically trim the bill to eliminate excess cost.

Is 2,000 hours a lie?

Yeah, except that 2,000 hour number is very often a lie. In busy firms, there’s much more work to do. And if you, a junior associate, tell a partner that you can’t do his project because you have a prior social engagement, your career at the firm will be… limited.

Why is it important to know how many hours you work?

After all, it often forms the basis for the calculation of their salaries.

What is chargeable activity?

Generally, any activity that is done in direct relation to a client’s project is considered chargeable. This includes the research carried out for their benefit, the meetings undertaken with them or associated parties, translation services, etc.

What is desk time?

Although a time-tracker by essence, DeskTime allows you to keep an eye on more than just the time taken on each activity by every lawyer on the team. It helps you plan a schedule for the professionals while taking into account their productivity and strengths and managing their future absences.

Do paralegals have to have billable hours?

There can be a daily requirement of billable hours for each employee, from senior partners to junior paralegals, that can help justify their salaries.

Is every hour after signing a contract billable?

Although, as a general rule, it is considered that every hour after the client signs the contract should be regarded as billable, and all hours before the same are to be noted as non-billable. [ [ [

Is commute time included in hours?

For instance, the time taken to commute to the client’s offices for a meeting can also be included in the hours since the activity is in direct relation to the project.

Do you need to mention all the activities that will be billed for?

However, if you work on an hourly-rate-based invoice system, you need to specifically mention to the client all the activities that will be billed for.

How many hours does an attorney spend?

How many hours do 1,892 hours take up a young attorney’s life? Yale Law developed a chart that gave reasonable amounts of actual time spent for 1,800 billable hours and 2,200 billable hours. The chart accounts for vacations, coffee breaks, conference times and even chit-chat – all those activities that take up an attorney’s time but are not billable.

How many hours can an associate work?

To achieve 1,800 billable hours, an associate would work her “regular” hours plus an extra 20 minutes Monday through Friday, or work one Saturday each month from 10:00 a.m. until 5:00 p.m. The first option would give an attorney 1,832 billable hours, with a total of 2,430 hours spent “at work” (AKA: including performing non-billable activities.).

Does a junior associate have to maintain a schedule?

So the answer to that question of longevity – in terms of keeping up with a big law schedule – is that the junior associate must maintain the schedule throughout her career.

What is the first order of business when deciding to work for big law?

Adam Pascarella, in an article offering advice to junior associates, listed determining your goals as the first order of business when deciding to work for big law. There are a couple of scenarios. If she plans to stay and make partner, then she must go above and beyond the required billable hours in addition to out-performing in other law firm areas. Furthermore, the hours only get longer as she moves up the ladder to partnership status.

How long do you have to wait to let an associate go?

If within three to six months the associate is not on track, they may be let go.

How many hours do first year associates need?

But the average number of billable hours required for first-year associates at firms with more than 700 attorneys is 1,930 hours. The lesson is that if a first-year associate is going to play, (s)he’s going to have to really knock it out of the park as far as meeting the required hours.

Do first year associates count billable hours?

First-year associates will probably count billable time instead of sheep while trying to fall asleep. It’s just not something that will go away and quite possibly haunts the minds of several newly minted attorneys while trying to get a good night’s rest. But the hoops of billable hours are manageable. A first-year associate just has to decide in the beginning how much the chase for the golden ring is worth, and go from there.