Even though billable hours seem permanently ingrained in the culture of American law firms, there are many attorneys who prefer flat fee is to billable hours. The flat fee method requires a client to pay a single, one-time fee for completion of a designated project. For example, an attorney might charge $800 to prepare a will. Billable hours, on the other hand require complicated attorney billing in which each six-minutes increment spent on a project is accounted for. The stereotypical Kelowna injury lawyer firm bill contains line after line of billable hour entries. Here is a quick explanation of why some attorneys prefer flat fee arrangements:
Reason one: certainty regarding fees. Law firm bills that are based on billable hours often very in amounts from both the client and attorney expectations. Such variation is inevitable because legal work rarely takes precisely the amount of time expected. While it is true that clients can just use a flat fee method bill or sue for malpractice, it is nevertheless the case that flat fee you arrangements provide greater certainty are both attorneys and clients. Attorney billing projections are easier to make when work is done on a flat fee basis, because less of the attorney’s income is left to chance.
Reason two: reward for efficiency. Attorney billing under the billable hours method incentivizes attorneys to spend longer than is necessary on a project. In my experience, attorneys billing time still try to be efficient for their clients, but they actually lose money if they work too fast. With flat fees, an attorney’s efficient work frees up his or her time without costing money in the form of lost revenue. Law firm bills are also made more efficient with the flat fee method because there is less need for extensive explanation or scrutiny.
Reason three: reduced administrative load. Clients who pay a flat fee generally require less accounting for the attorney’s time. The flat fee method that’s removes a horrible burden for attorneys — the burden of having to record all time spent in six-minute increments. Simple attorney billing and simple law firm bills add up to a huge time savings for attorneys, not to mention improvements in lifestyle.
These are the reasons why some attorneys prefer flat fees to billable hours. The flat fee method of attorney billing is simply easier for attorneys. It also often saves clients time and money. At a minimum, clients appreciate the simplified law firm bills.