Nina Lee

Efficient billing practices are essential for the success of your law firm. However, the time spent on billing can often become time-consuming, detracting from the productive hours of your day. Furthermore, this time spent on billing is typically not included in your billable hours, resulting in potential revenue loss. 

Fortunately, there are ways to streamline your billing process and optimize your attorney billing statement, enabling you to expedite the invoicing process and ultimately enhance the profitability of your firm.

What Is an Attorney Billing Statement?

An attorney billing statement is a versatile and customizable invoice template that your law firm can utilize to bill your clients in an efficient manner. 

With an attorney billing statement, you have the flexibility to tailor the invoice to meet the specific needs and requirements of each client, ensuring that it accurately reflects the services rendered and the associated costs. 

This enables you to create professional and comprehensive invoices that clearly communicate the details of the legal services provided, the corresponding charges, and any other relevant information in a clear and concise manner.

What Is in an Attorney Billing Statement?

Your billing statement will be tailored to your firm, but in general, all invoice templates should have the following elements:

Details of the Firm and Client

The billing statement should always have the information about your law firm and your client, including:

• Names
• Addresses
• Phone numbers
• Email addresses

The Date

Including the date of issue on an invoice is crucial for proper financial management and communication with clients. It serves as a reference point for payment terms, evidences timely delivery of the invoice, streamlines communication, and supports accurate record-keeping.

Itemized Services and Costs

The most time-consuming part of an invoice is recording the details of the services and their costs. This is important, however, as clients have a better understanding of what they’re paying for and are less likely to raise disputes.

The descriptions of the services should be brief, such as “prepared documents for court” or “researched case law” with the amount of time spent on each. Lawyers traditionally track time in six-minute increments for accuracy. The costs are based on your fees, which may be flat or hourly.

Expenses

If you have expenses associated with the client’s case, such as filing fees, include them on the invoice. You’ll want to include detailed descriptions of each expense so clients understand the value add. Hard costs are often easier to communicate than soft costs that are typically associated with the administrative brunt work needed for a client case. 

Totals and Taxes

After itemizing the services, you should be able to calculate the subtotals and total easily. If you have legal billing software, these calculations may be done automatically.

Once you have the total for all the services, include the appropriate service tax for your state on the billing form. You may wish to include the tax rate and total tax amount. Then, add the subtotal and total with the tax amount for the final balance.

Statement Due Date

Putting a clear due date on your invoice is important for law firm collections and getting paid on time. If you add late fees for overdue payments, include those on the invoice as well.

Depending on the state, you may be able to assess late fees at a percentage of the invoice amount or a flat fee up to a certain amount, but be sure to check with your state bar association.

Payment Methods

Include the options for payment on your invoice. If you accept checks, provide the name and mailing address. If you have an online payment portal, include the details to simplify it for the client.

Your accepted payment methods should be discussed prior to taking on your client’s case, but it’s good to have them listed as a reminder on your invoice.

Sample Attorney Billing Statement

Here is a sample billing statement:

How to Prepare a Billing Statement for Attorneys in 4 Steps

Creating a process for billing statements makes invoicing and billing can make the processes more straightforward in the future. Here’s how:

Step 1: Set Your Fees

Your fees are usually based on competitors and what’s appropriate for your practice area, experience level, and reputation. You’ll want to research and analyze what’s fair in the market along with your firm’s value proposition. 

Step 2: Capture Time

Accurate invoices have every minute tracked accurately. With Bill4Time’s timekeeping software, you can ditch the spreadsheets and capture time in real-time with timers on your phone, desk, or tablet. This not only ensures you get paid, but it helps present more accurate information about the work you do for your clients.  

Step 3: Automate Invoicing

Create, print, or email professional invoices with Bill4Time software, complete with payment terms, late fees, discounts, and more. You can also include custom payment links on your invoices for clients to pay online. 

Step 4: Communicate with Clients

A positive client experience starts with effective communication at intake. Proactively communicate your invoicing and billing details in advance, including fees, schedules, payment terms, and payment methods.

3 Attorney Best Practices for Legal Billing

Billing and invoicing software like Bill4Time makes it a breeze to create a customizable billing template to free up your time. Here are some of the best practices for legal billing:

Offer Multiple Payment Options

Clients want to be able to pay using the method they’re most comfortable with, and as a result, your firm gets paid faster. With Bill4Time Payments, your clients can pay using eChecks or major credit and debit cards for the fastest and most convenient payments.

Offer Custom Payment Plans

Payment plans make it easier for clients to afford legal services by reducing large bills. Bill4Time Payments allows you to create custom payment plans with weekly or monthly installments and automated payment reminders.

Show Consistency

It’s important to set up billing expectations with your clients from the start. You should communicate your billing timelines and send your invoices based on this cadence, so clients know when to expect a bill. This also ensures that your cash flow is more predictable.

Streamline Your Billing Statements

Invoicing and billing are often the most time-consuming and cumbersome part of running your law firm, but it doesn’t have to be. With law firm invoicing software, you can create a streamlined billing process that saves you time, creates a better client experience, and gets your firm paid faster.

Think about what makes your firm stand out. Quality of service or a long-standing reputation may come to mind. However, there are thousands of law firms and lawyers that do the same work you do. To increase law firm growth, it’s important to hone in on what sets your practice apart in the competitive legal field. 

With a strong value proposition, you can give your firm the competitive edge that draws clients in and sustains long-term growth. Continue reading to learn how. 

What is a value proposition?

A value proposition is a promise you make to clients about the services you will provide. It’s a persuasive, results-driven argument that gives clients a compelling reason to work exclusively with your firm. Your value proposition should be tied back to your firm’s mission and values. 

A strong value proposition is carefully crafted and very compelling. It’s comprised of four specific ingredients from your client’s perspective: 

• Appeal: What attracts clients to your firm
• Exclusivity: I can’t get this from any other law firm anywhere else
• Credibility: I believe your firm’s claims
• Clarity: I understand your firm’s claims

A strong value proposition is more than “we’re committed to serving you,” but a clear statement of the value your firm can add to your clients’ lives with defined results. 

Double law firm growth with a strong value proposition 

True uniqueness, in the form of a strong value proposition, shapes client perceptions. It helps clients filter and sort through the hundreds or thousands of firms competing for their attention and their dollars. 

Warren Buffett, the legendary investor, coined the term “economic moat.”  He defines an economic moat as the competitive advantage one firm has over its competitors. An economic moat accomplishes two things (1) It enables your firm to dominate the marketplace and (2) It keeps competitors at bay

Let’s dive into the different types of moats: 

• Brand moat. Service clients are willing to pay more because they trust your brand or believe in your reputation. Research consistently shows clients are eager to spend more on brands. Think Coca-Cola, Mercedes-Benz, Skadden, Arps, Slate, Meagher & Flom.
• Secret moat. This typically refers to a process or intellectual property that makes direct competition with your firm difficult. This could be your client lists, a unique approach, a proprietary database, or a unique training methodology. It’s created or developed organically and gives firms a competitive advantage in the marketplace.
• Toll moat. These are firms with exclusive or dominant control of a market or niche. This control means you’re typically the only game in town. Clients must come to you if they want “it.” Google, Comcast, and your internet and utility company are all examples of toll moats. 
• Switching moat. This refers to a firm that’s entangled in its client’s business. There are varying degrees of enmeshment. It can be as simple as being indispensable to your clients or as complex as equity stakes and co-ownership. The idea here is simple. Clients can switch at any time, per their agreement, but doing so is far more hassle than it’s worth.
• Price moat. You’re able to compete via a significant price (low or high) advantage. You’re able to provide clients with a price they’re unlikely to get anywhere else.
• Performance moat. With this moat, you’re able to produce results or outcomes your competitors can’t, and you’re able to do it consistently. You bring your experience, expertise, and knowledge to bear in a way that’s difficult for other competitors to match.

What kind of value proposition do you actually need? To maximize value and increase law firm growth, you need to create impact at two specific levels:

• The firm level: You need to give clients a specific yet compelling reason to work with your law firm. As mentioned previously, your value proposition is a promise. You’ll need to provide clients with a compelling reason to work with your firm.
• The service level: Your firm may be amazing, but what about your associates? Do they produce great work? How do clients know, in quantifiable terms, what they’re getting? A value proposition at the service level answers this question decisively.

For example:

• Developing a unique service process (e.g., hiring all-star associates, litigating, drafting documents, etc.)
• Making a compelling promise, one you’re legally able to make
• Creating a strong, trustworthy brand via consistent advertising, a powerful review profile, and branding
• Creating helpful software, and sharing it with clients free of charge
• Offering add-on services, tools, and resources to create the “golden handcuffs”
• Creating innovative-yet-legal alternative fee arrangements (e.g., fixed fee, subscription, or insurance models)

However, seeing is not the same thing as doing. How do you go about creating a compelling value proposition for your law firm?

Acting on your firm’s value proposition

A strong value proposition doesn’t come from our past, it comes from our future.

Choose the one thing you’d like your law firm to be known for. Whatever you stand for, make sure it’s one thing. Adding in too many services or promises can be difficult to manage and negatively impact quality.

Once you’ve come up with a strong value proposition, test it. A large component of sharing your value proposition is through marketing. There are a variety of simple and low-cost methods you can use to test the strength of your value proposition, including:

• Creating blog content to showcase your thought leadership and expertise
• Posting on social media to connect with your audience and network
• Using targeted advertisements to promote and attract your audience

Once you’ve deployed these methods, you’ll want to have a process in place to track and report on their performance. Based on the results or return on investment, you can determine how clients are responding to your value proposition and pivot accordingly.

While it’s important to define your value proposition and effectively promote it, having the resources to perform your services is essential. Client demands have shifted and the need for digital services is paramount. Bill4Time modernizes law firms by automating core business functions and administrative tasks that traditionally consume their days. With automated legal billing, built-in online payments, invoice templates, and more — firms can streamline repetitive processes so they can focus on areas of their business. 

Outlook on value propositions

A strong value proposition is rooted in your firm’s mission, values, and expertise. Above all, it’s about delivering on your value proposition. It’s easy to say what your firm can do, but clients want tangible results. With a strong value proposition and the right resources — your firm will be well-positioned in the legal market.

It can be an ongoing effort to get clients to pay their invoices faster or even just on time. Clients run on a different timeline than your firm, so they may not understand the moving parts involved in your invoice and billing department.

Before you start placing blame, you need to step back and analyze what obstacles your clients may be facing that are preventing them from paying their invoices on time. The issue could very well lie within your firm’s billing practices or lack thereof.

Continue reading to learn 3 simple law firm invoice practices that support clients to pay their invoices faster.

Get Your Law Firm’s Invoices Paid Faster

If your law firm’s billing isn’t in order, how can you expect your clients to be? Having a uniform, automated law firm invoice and billing process are key to setting your clients up for success.

Step 1: Communicate Your Firms Billing and Invoicing Policy

Create a clear communication plan that outlines your firm’s billing expectations. This should be discussed at the beginning of the client relationship, preferably during the client intake process. The plan should include a scope of work, billing timeline, payment options, fee arrangements, and billing point of contact. Think of common questions you get from clients that can easily be satisfied in your communication plan and build from that. This plan should also be available electronically for the client to reference.

Tip: Upload your legal billing policy document to Bill4Time so it’s accessible across your firm and can easily be sent to clients.

Step 2: Standardize Your Law Firm Invoice Process

Just like you, your clients are busy and can occasionally lose track of deadlines. Understanding that this is human nature, your firm can set up invoice payment reminders leading up to the date. For example, you could send invoice payment reminders 14 days, 7 days, and the day before the due date. Your firm should also send reminders if the invoice is late and any associated consequences or fees.

With a solution like Bill4Time, you can use features such as custom invoice templates and automatic reminders to streamline this process. Not only does standardizing your invoice process keep your clients accountable, but your firm can report on average invoice payment windows and keep a pulse on payment status.

Step 3: Offer Online Payments

Clients don’t want to waste time running to their bank or filling out physical checks. If your firm is still relying on a paper check process, it may be creating more hoops for your client to jump through. For instance, if a client is accustomed to paying online, they may not have checks easily accessible to them.

Bill4Time makes accepting online payment seamless with the built-in payment processor, Bill4Time Payments. Easily send custom payment links on emails or invoices, create payment plans, and even allow clients to pay their invoices from their client portal.

Online payments are not only a form of great customer service, but they will prompt your client to pay faster. Faster payments mean a cleaner billing cycle and increased revenue for your firm.

Streamline Your Law Firm’s Invoice Process

If your law firm is still hesitant to adopt practice management software, you may be limiting your firm’s profitability and creating obstacles for clients. Particularly when it comes to billing, closing unnecessary gaps in the paper check billing process and offering modern ways for clients to pay will ultimately lead to a higher yield of on-time invoices for your firm.

Is your staff dragged down by tedious tasks? Despite your firm’s efficiency and hard work, you and your staff have only so much time in the day to complete everything on your plate. If you’re spending too much time on administrative tasks, you’re not devoting enough time to the important stuff, like helping clients, practicing law, or growing your firm.

Many law firms face this predicament, so they turn to outsourcing legal services.

When you outsource, other businesses take on tedious tasks, such as document and task management or billing and invoicing. Some firms turn to technology like Bill4Time to “outsource” their firm’s most time-consuming tasks like case management or billing.

Law firm outsourcing saves you time and money so you can boost your firm’s productivity and direct more of your resources and energy toward clients, cases, and growth. 

What Is Legal Service Outsourcing?

Legal service outsourcing is when law firms hire other professionals and companies to take on some of the attorneys’ duties. This way, they can save time and money, allowing them to focus more on their client’s needs and improve their services and reputation.

Some tasks law firms outsource include:

• Administrative tasks, like scheduling, issuing invoices, and recording time entries
• Document management, like organizing client files and uploading important information
• Marketing, like responding to client comments and reviews or creating email marketing and social media posts

What you want to outsource is up to you. Your firm can analyze where you commonly see bottlenecks, missed opportunities to get cases, and more to determine what you need help with most. Additionally, the businesses that handle these tasks can customize how they serve you.

How Often Do Law Firms Outsource Legal Services?

Law firms are outsourcing legal services, and that trend is only on the rise. In 2021, a Reuters survey of small law firms found that 26% of respondents had implemented technology to address pressures and improve their services’ efficiency. Additionally, 19% want to use technology more to outsource and improve some of their firm’s operations. 

More law firms are looking into optimizing their services as they realize they need more support with payroll, case research, and billing. In a short time, the practice of outsourcing legal services will likely expand significantly.

Is Legal Outsourcing the Same as Offshoring?

The short answer: No.

However, they do relate to each other. Legal outsourcing occurs when you contract a specific task or tasks to a third party that works in that field. For example, if you need help with setting up your billing and invoicing templates, you would hire a company that offers specific aid in that area.

On the other hand, when you participate in offshoring, you’re sending your in-house jobs overseas to complete your work remotely—at times, for a lesser cost. For instance, if you’re in the United States and want assistance with producing high-tech devices, you may offshore this work to reduce labor costs. 

Benefits of Legal Service Outsourcing

Hiring a team for legal service outsourcing comes with plenty of benefits, including:

• It’s cost-effective: Generally speaking, it’s cheaper to have someone who works outside the law firm complete certain services for you. That is, it can help keep your overhead and staffing costs on the lower end.

• Supplement your systems when your resources are limited: Sometimes, law firms don’t have the necessary technology to complete certain tasks. For example, you may not have a system for timekeeping. Outsourcing your services to another company that has a program designed for timekeeping can save you time and money, as you won’t have to dedicate extra hours to handle it on your own.

• The ability to support more clients: When you’re preoccupied with menial tasks for much of your day, it can take time away from your clients. As a result, your brand and reputation may take a hit, especially if your clients are overcharged, or you lose their information.

Types of Legal Service Outsourcing Processes

Legal services outsourcing isn’t limited to one type of process. Depending on what your firm needs, the company may tailor its services to how your firm operates. Typically, law firms may seek assistance with:

Billing

Inform the company about the payment structure you use. Flat fees? Hourly? Contingency? 

Whatever the case, the company to whom you outsource can create and customize an invoice template and set up the terms for online payments and late fees.

This feature allows the client to pay you with one click. That way, it’s convenient for the client, and you receive your payment right away.

Filing and Document Management

Uploading documents into a cloud-based system allows you and your staff to easily access data and other controls at any time. That way, you don’t spend hours remaking documents and searching for client folders.

If you need to move things around, rename, or customize documents, you can. These features should be flexible and mesh with your firm’s current needs.

E-Discovery

Thanks to e-discovery technology, law firms can easily identify and collect important data for cases. Not to mention, e-discovery can help you with your document management, such as scanning your uploads.

It makes these documents more accessible to their clients and saves their memory and time.

Administrative Tasks

Legal services outsourcing can also take care of your administrative tasks. The contracting company can manage aspects of your client relationships, bookkeeping, timekeeping, and even phone calls.

You don’t need a full-time employee to be responsible for these tasks when someone else outside your firm can perform them for a fraction of the cost.

How to Hire for Legal Service Outsourcing

If you’re looking for legal consultants or freelance workers to assist you with your legal services, check out these websites:

• Lawyerist
• Fiverr
• Guru

While you’re searching for the right fit, think about the qualities that will add to your firm’s success, like:

• Experience: How long have they been in the business? What was their training like? Who have they worked for?
• Skill: What are they capable of? How much of a workload can they handle? What do they prioritize at work? Do they have any specializations or certificates in certain areas?
• Familiarity with legal technology: Many contractors continue their education to keep up with the latest technology. Have they listed what they have expertise in? For instance, see if they know how to manage legal billing and invoicing, timekeeping, and task management using legal software.

Narrow down your top two or three favorite candidates. Don’t just consider their past but also their potential.

When Should I Consider Outsourcing the Legal Services at My Firm?

If you’re not sure if you should look into legal process outsourcing services, reflect on the well-being of your firm.

You may want to consider the extra help if you’re experiencing:

• Overwhelming caseload: If you’re taking on more than you can handle on your own
• Decreased client experience: If you’ve received client complaints, especially about errors in their invoices or lost documents
• Tasks falling through the cracks: If you find yourself putting off sending invoices, uploading client documents, or reminding your clients to pay you

Simplify Outsourcing With Legal Technology

You don’t have to take care of all your practice’s tasks on your own. Help is available, and it doesn’t have to be complicated. Don’t be intimidated about having someone work remotely for you. You can easily manage their tasks, especially when your firm’s most crucial documents, billing records, and customer information is housed in a central location.

When you have Bill4Time on your side, you can outsource many time-consuming legal services—like billing, invoicing, timekeeping, and other tasks—using a single software system. It’s easy to use, efficient, and affordable. That way, you spend less time dealing with tedious tasks and focus more on your clients. Request a demo with us today.

Managing billing can be a cumbersome process and take up a large portion of a law firm’s productivity on tasks that don’t directly bring in money — like invoicing. 

Most lawyers get into the legal profession to practice law, not to be overloaded with billing, invoicing, and other administrative tasks. One way to streamline this process is with legal billing software to automate tasks such as invoicing, payments, or retainers.

Both retainers and standard invoices have their purposes in a law firm. Regardless of which you choose, both can be standardized to make your day easier and get your firm paid faster.

What Is a Retainer?

A retainer is a payment agreement between the law firm and the client. In this contract, the client agrees to pay the law firm a predetermined amount for a certain number of hours or specific tasks.

Retainers can be various lengths, but the retainer itself is usually open-ended. Retainer invoices are usually paid on a monthly basis with the agreement that the law firm will complete the agreed-upon work within that period.

What Is on a Retainer Invoice?

A retainer invoice is a bill that’s drawn up for the services rendered by the law firm. It’s sent from the law firm to the client and contains all the details about the work, fees, and transactions. The client knows exactly what they’re paying for and has all the information to settle the bill, including;

• Contact information for the payee (law firm) and payer (client), including the name, address, email, and phone numbers.
• Contact information for the payee as well as the name, address, and contact numbers of the business, person, or department that will be handling the invoice.
• Invoice number for documentation.
• Relevant dates, including the date of the invoice and the due date for the payment.
• Details about the specific services to be provided.
• The amount owed, including past-due balanced or any applicable taxes.
• Accepted forms of payment, including online payment methods.

What Is a Standard Legal Invoice?

A standard legal invoice is a document that law firms issue to customers to request payment for legal services. The billing processes may look different depending on the client and practice areas, but all standard legal invoices should have the following information:

• Law firm details: Identifying details, including the firm name, phone number, email address, and physical address.
• Client details: This may vary according to the client, but the invoice is usually addressed to the point of contact. Some clients may provide a billing contact, however.
• Date of issue: The date you’re sending the invoice.
• Itemized list of services: A breakdown of the services the law firm provided to the client.
• Billing rate for each service: The rate for each service line item the law firm provided.
• Total due for each service: The total amount owed based on the itemized list and billing rate for the services provided.
• Subtotal for all services with taxes: The total amount the client owes for each service, including the percentage of services tax.
• Payment due date: The deadline for payment.
• Late payment consequences: The penalties if the client pays late.

What Is the Difference Between a Retainer Invoice and a Standard Invoice?

Retainer invoices can be used by the law firm to ask for payment before the services are rendered. Essentially, it’s a form of deposit or prepayment.

This is a method for the client to secure legal services as needed and for the law firm to get paid in advance for services. Law firms can also choose to bill based on billable hours or a fixed fee for a retainer, depending on the nature of the case.

Retainers also set up clear expectations for the ongoing arrangement, including the retainer amount, excess hour charges, and more. There’s a sense of security and predictable recurring revenue for the firm as well.

A standard legal invoice is broader and may include any invoice for legal services rendered, including billable hours, subscription services, sliding scale fees, unbundled services, payment plans, flat fees, and contingency fees.

The key difference between a standard and retainer invoice is that the client is paying for services in advance instead of in arrears. There are benefits and drawbacks to both, depending on your law firm, client, and practice area.

How to Manage Law Firm Invoices

Billing and invoicing take up a lot of time in your law firm. Depending on the type of law you practice and the cases you take on, it can waste a lot of non-billable time.

It’s necessary for a law firm to stay profitable. A defined billing process determines how efficiently your firm gets paid which includes implementing a streamlined invoice process.

Traditional invoicing is a manual process that’s vulnerable to human error and hinders productivity. When a lot of time is spent on invoicing, it can advertently also cost you money.

Law practice management software, such as Bill4Time, is a simple way to standardize your billing and invoicing process. Features like time tracking, built-in payment processing, and custom invoice templates reduce the time spent on these administrative tasks and get your firm paid faster.

With Bill4Time’s legal billing software, you can create, print, or email custom invoices in a matter of minutes, complete with detailed services, payment terms, and late fees. These invoices seamlessly link to the online payment options to make paying quick and convenient for the client.

There are also tools to maximize efficiency. You can batch invoices, apply LEDES format, allocate payments to current invoices, create summaries, and track expenses to keep your firm moving toward long-term growth.

Simplify Law Firm Billing and Invoicing with Law Practice Management Software

Whether you bill on retainer or with standard invoices, manual billing and invoicing processes foster human error, decrease client satisfaction, and cost valuable time and money. By standardizing your billing, you can offer more transparency into your billing and improve bottlenecks within your billing cycle.

For attorneys, time is money. Most attorneys rely on billable hours for their income, and many firms expect attorneys to achieve a minimum billable hour requirement of 1,700 to 2,300 per year.

To meet this requirement – and get paid – attorneys must track their billable hours efficiently and accurately. “Padding” errors hurt the attorney and the firm’s reputation but missing out on valuable time in the time tracking process leaves money on the table.

Plenty of resources are available to help attorneys easily and efficiently calculate and log billable hours, including an attorney billing increment chart and time tracking software for attorneys.

What Is an Attorney Billing Increments Chart?

A billing increment chart is a standardized chart or template that helps you calculate how many increments of an hour to charge based on the time you spent working. With a billing increment chart, most attorneys stick to a 1/10^th of an hour rule, or 6-minute increments.

This means if an attorney works for 15 minutes at a rate of $100 per hour, the chart will show that the time increment is 0.3. This is multiplied by the hourly rate ($100/hour) for a sum of $30.

Here’s a sample billing increment chart:

Why Do Attorneys Bill in Increments?

Billing in increments is standard practice for practical reasons. Billing by the minute or just a few minutes is difficult to track and time-consuming, not to mention calculating it by hand. This can lead to a lot of wasted time in the tracking process and plenty of errors, which create doubt in the clients.

Similarly, billing in large increments, such as by the half-hour increment, pad the bills. Attorneys either mention one task in that time or combine multiple, unrelated tasks, casting doubt on how much time they actually spent on casework.

Billing in 6-minute increments is easy to calculate and allows for reasonable increments without too much padding or lost time.

Do Attorneys Have to Bill in Increments?

Law firms can structure their billing as they choose. The standard increments used by most firms are 1/10 of an hour (6 min), 1/6 of an hour (10 min), and 1/4 of an hour (15 min). This is a matter of convenience rather than necessity. Attorneys choose the increments they intend to bill in and then round up to the nearest billing increment of their choice.

Billing increments can present problems for the firm and the client, no matter what they are. Smaller increments look better to the client, but billing in 6-minute increments is inefficient and puts attorneys in a position to “beat the clock.”

Larger increments aren’t much better, as they can look unsavory to the client. Larger increments suggest – even if untrue – that the attorneys are billing for more time than they’re actually putting in. This can have a detrimental effect on the firm’s reputation, especially if the other firms in the area rely on small increments.

What Is Time Tracking Software?

Legal time tracking software is a cloud-based resource to log, categorize, and record the time spent on billable and non-billable tasks. This software tracks work in real time to reduce errors or missed time, ensuring efficiency in the tracking process and accurate billing for both the firm and the client.

Benefits of Time Tracking Software

Attorney increment charts are helpful for doing the quick calculations necessary to convert hour increments to billing rates, but that’s still not as efficient as it could be. Time tracking software takes it a step further with efficient, convenient, and accurate timekeeping.

• Automatic increment calculation: Rather than manually calculating time increments and billing rates with a chart, time tracking software uses pre-set rates to automatically round time entries to the nearest increment.
• Simplified time tracking processes: Time tracking software helps you log your billable hours when they happen, instead of trying to remember them later. You can add time entries to meetings, events, tasks, emails, and more.
• Real-time tracking: Time tracking software has automatic timers to record the time you spend on a task, so you don’t have to guess or risk forgetting your hours. 
• Multiple devices: Using a cloud-based format, time tracking software can track time entries on the mobile app to record your time while working remotely or taking client meetings in the field.

Best Practices for Managing Billable Hours

Law firms can bill efficiently and transparently when there are standards in place for billable hours.

Create Guidelines

There should be rules in place for billing increments. Use policies to explain your rates and billing practices to both clients and staff. These policies should include the rate, billing increments, billing intervals, and billing method. This helps manage client expectations for billing and ensures that attorneys understand the processes.

Itemize Your Billing

It may be faster to multitask and include several tasks in a block of time, but that doesn’t inspire faith in the client. Take the time to itemize tasks separately for better accuracy, transparency, and clarity. This can be made easier with custom invoice templates that can be pre-filled and stored for future, continuous use. 

Use Detailed Descriptions

Detailed but concise descriptions are essential for transparent billing. These descriptions should include enough information for the clients to understand how you spent your time. If a dispute comes up, this can serve to jog your memory to help you account for the time you spent as well.

Track Time Accurately

Whether you choose a manual billing increment chart or efficient time tracking software, make sure your billable time is real-time and accurate. With the use of multiple timers, you won’t forget about the time spent on a case or estimate time either in the firm’s favor or the client’s.

Don’t Pad Your Bill

It may be tempting to round up to the nearest increment or hour when billing, but is not best practice. Padding your hours – intentionally or otherwise – is unethical, inaccurate, and potentially damaging to your firm’s reputation.

Replace Attorney Billing Increments with Legal Time Billing Software

An attorney billing increments chart was a useful resource when manual timekeeping was best practice. With the introduction of legal technology, law firms no longer need to spend hours counting their hours and doing the math for billing clients. By implementing legal time billing software, your law firm has access to an automated process that ensures accurate, convenient, and efficient time tracking and billing every time.