I may not work at a big firm, but the concept of “hitting your billable hours” is well-known to law students, lawyers, and fans of John Grisham novels. Smaller firms and solo practitioners might not have a threshold number, but they still know how many hours they need to bill to stay in the black.
Admittedly, hourly-billing has advantages, which is part of the reason it is so widely used. But it also has a number of downsides.
Hourly billing creates barriers between lawyers and clients
As this recent article points out, billing clients for cursory emails does not facilitate strong client relationships. In that case, a lawyer emailed a client with some amended documents. The client quickly responded and said she would review the changes later. The lawyer responded with “I hope everything is ok, take your time.”
The client was then billed .2 hours at $300—$60 for that unnecessary email. I understand needing to account for your time, but that seems ridiculous. The client felt the same way, and ultimately confronted the attorneys. The attorneys, however, simply defended their billing, and said that email took them away from a multi-million dollar case, so they had to bill for it.
It is bad enough to charge for that, but defending it is even worse. Flat-fee billing does not eliminate awkward money discussions, but they are far less frequent.
Flat-fee billing helps your focus on the big picture
With hourly billing, you may spend a large portion of your day accounting for what you are doing, rather then actually doing.
You may also lose sight of the bigger picture. With flat fee billing, the goal is to become more efficient, not less efficient. You can spend an extra ten hours on a brief because you know you will use it again. Next time, that same issue will be resolved faster and more efficiently.