It remains, however, an inescapable reality that many commonly billed legal tasks are both essential and labor intensive. The proper use of technology cuts down on the labor required. Since labor equals cost, I take an interest in how well my law firms deploy labor-saving technology. But I don't choose between law firms on this basis; that is, unless performance on the audit is the only item that separates two firms vying for a project.
My firm does not bill clients for busywork. We give that to the staff.
Possibly true, but unlikely. I will visit your firm's office to conduct the audit. You are welcome to demonstrate how your firm is different. A few observations:
- It is important to reflect on the implications of the statement, which translates, to my, admittedly, cynical ears as: We may be wildly inefficient, but we don't charge clients for it.
- The audited tasks are designed to test general skills. Few lawyers can avoid using Microsoft Excel, Word, and Outlook as well as a PDF program.
- "Staff" often includes paralegals, who bill for their time. The audit is concerned with the work my company pays for, not the title of the person whose time is billed.
- Reliance on unbilled staff has been shrinking for decades. For example, anecdotal data suggests that the ratio of lawyers to secretaries has grown from approximately 2:1 to 5:1 since 1980.
- The less training, the more busywork the lawyers will generate. Likewise, the less training, the less assistance the staff can provide. Thus, the firm's training program is a good indicator of both the volume of busywork and its division between the lawyers and staff.
- Staff are not usually available during the marathon night and weekend sessions during which so many billable hours accrue.
My firm does not bill clients for busywork. We cut that time.
Again, possibly true, but unlikely. I will visit your firm's office to conduct the audit. You are welcome to demonstrate how your firm is different.
In general, I don't believe lawyers are intentionally inefficient. The audit presumes pure motives. The audit, however, also presumes ignorance. The lawyers billing the time don't know they are being inefficient; nor do the lawyers reviewing the bills recognize the inefficiencies. The willingness to cut wasted time is implicated only after waste is identified.
Further, parsing bills is hard. Regardless of the guidelines or task-code requirements, lawyers bill time in large clusters and undifferentiated chunks. It is genuinely difficult to say how long a particular assignment should have taken.
Timekeeper: I worked on X from 10 a.m. to 4 p.m. with a few breaks for coffee, internet, etc. So 5.2 [hours]. Billing partner: She did a good job, but 5.2 seems a little long. So 4.9 [hours]. Client: I have no idea whether that particular task should taken .9, 4.9, or 9 hours. But the overall bill seems in line with the matter. So I'll approve it.
Isn't an alternative fee structure the better mechanism to align incentives and place the onus on law firms to address these systemic inefficiencies?
Probably. But the perfect should not be the enemy of the good. And, for the moment, the billable hour remains dominant. Personally, I have encountered difficulties, internally and externally, in moving toward alternative fees.