Many Lawyers Hike, Vary Rates Depending on Customer

Designed "to foster more effective pricing decisions for law firms, corporate legal departments and claims organizations."

The vast majority of American lawyers — 78% —  bill at different rates for similar types of work, according to a new study.

In tough economic times, the response of 18% of all lawyers was to increase their billing rate by more than $100.

And somewhere in America, a 4^th year government associate bills at $750/hour.   The study discovered two first year litigation assoicates billing at $650/hour.  

Three Year Study of Lawyer Billing

Those are the initial results of the  study called the Real Rate Report, a study produced by CT TyMetrix, Inc., and The Corporate Executive Board Company.

The compilers said the report ”is based on empirical data gathered from $4.1 billion in invoicing generated by over 3,500 law firm and 90,000 individual billers over three years (2007-2009). This comprehensive data encompasses 51 metropolitan areas, companies ranging in size from one to 1,940 and from over twelve industries including energy, entertainment, finance, insurance, healthcare, manufacturing, pharmaceutical, retail and technology. ”

 During the period studied, legal bills increased at rates that exceeded inflation.   No discounts were offered to the majority of in-house lawyers from individual law firms with which the company did business.

Inconsistencies by Individual Lawyers

The American Lawyer was struck by the inconsistencies the report produced, particularly the wide variability of charges by individual lawyers for the same or similar services.

“The location of the biller and the size of the biller’s firm–not the biller’s experience–are the variables that most influence how much a client will pay,” according to American Lawyer.  “And though in-house counsel talk a good game about keeping rates in check, they approve almost three-fourths of all timekeepers’ rate hikes.”

According to the authors, “the Report can foster more effective pricing decisions for law firms, corporate legal departments and claims organizations.”