Header graphic for print
In Search of Perfect Client Service Why lawyers don't seem to get it

Further Data Critical Of The Hourly Rate System

Posted in Hourly Rates and Alternatives

The May 2007 issue of Inside Counsel contains some interesting "Facts and Figures" (p. 24) on the views of Europe’s in-house counsel. 

General Counsel who believe their outside counsel have padded their bills …73%
In-house counsel who believe that billable-hour targets encourage padding …95%
Law Firm partners who believe that billable-hour targets encourage padding …50%
In-house counsel who believe project-based billing is the best alternative to the hourly rate …68%

I love the discrepancy between inside and outside counsel on the issue of whether billable hour targets encourage padding.  For only half of outside counsel to acknowledge the obvious suggests supreme disingenuity or that many outside lawyers in Europe live in Fantasy Land.

The other interesting point is the percentage of General Counsel who believe their lawyers have padded their invoices.  While the statistic is for European General Counsel, it is fairly consistent with surveys of US General Counsel.  Law Firms who take a critical view of their situation cannot feel comfortable with this state of affairs.  But the other 98% or so who are blind to the situation no doubt will blithely persist with a system that, at its core, puts lawyers and their clients at economic odds.