Billing rates going up

December 2, 2009
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Clients are going to have to pony up a little more cash next year for their lawyers. According to an Altman Weil survey on 2010 billing rates, only about 10 percent of firms surveyed plan to maintain their current billing rates or decrease rates. The average rate increase is projected to be about 3.2 percent.

Many of the firms said they felt pressure from clients to not raise rates, but felt it was necessary because they froze rates in the past few years. Some also said the move toward alternative fee arrangements makes the hourly rate increases “increasingly irrelevant.” A few firms noted the increases they’ll make aren’t nearly as much as they had in previous years.

Some firms will pass along the higher rates only to new clients or in certain practice areas. Associate billing rates will be the mostly likely to see the increase, and a higher rate increase to boot.

“Many firms feel the need to cover their associate costs with rate increases,” said Altman Weil principal Tom Clay. “And because associate rates are lower, increases there may attract less comment from clients than increases at the partner level.”

The AW survey includes comment from respondents regarding why they are or aren’t raising rates. Some interesting ones:

- “Firms need to push back on the clients' unreasonable demands to hold rates at 2008 levels and give a 15% discount off of those rates.”

- “We froze our rates moving from 2008 into 2009. I hear managing partners speaking of freezing rates moving into 2010. We can't sit out two years without changing, so we are going to do so, hoping that client goodwill from last year will cushion us at this year's hike.”

- “We don't even try to raise rates every year. The greedy SOBs that do have antagonized the entire industry to those of us who only seek to raise rates when economically necessary (and PPP isn't economic necessity).”

What’s your firm’s strategy in terms of billing rates for next year? Is increasing rates a better alternative than cutting attorneys for firms looking to find more cash?

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  1. If a class action suit or other manner of retribution is possible, count me in. I have email and voicemail from the man. He colluded with opposing counsel, I am certain. My case was damaged so severely it nearly lost me everything and I am still paying dearly.

  2. There's probably a lot of blame that can be cast around for Indiana Tech's abysmal bar passage rate this last February. The folks who decided that Indiana, a state with roughly 16,000 to 18,000 attorneys, needs a fifth law school need to question the motives that drove their support of this project. Others, who have been "strong supporters" of the law school, should likewise ask themselves why they believe this institution should be supported. Is it because it fills some real need in the state? Or is it, instead, nothing more than a resume builder for those who teach there part-time? And others who make excuses for the students' poor performance, especially those who offer nothing more than conspiracy theories to back up their claims--who are they helping? What evidence do they have to support their posturing? Ultimately, though, like most everything in life, whether one succeeds or fails is entirely within one's own hands. At least one student from Indiana Tech proved this when he/she took and passed the February bar. A second Indiana Tech student proved this when they took the bar in another state and passed. As for the remaining 9 who took the bar and didn't pass (apparently, one of the students successfully appealed his/her original score), it's now up to them (and nobody else) to ensure that they pass on their second attempt. These folks should feel no shame; many currently successful practicing attorneys failed the bar exam on their first try. These same attorneys picked themselves up, dusted themselves off, and got back to the rigorous study needed to ensure they would pass on their second go 'round. This is what the Indiana Tech students who didn't pass the first time need to do. Of course, none of this answers such questions as whether Indiana Tech should be accredited by the ABA, whether the school should keep its doors open, or, most importantly, whether it should have even opened its doors in the first place. Those who promoted the idea of a fifth law school in Indiana need to do a lot of soul-searching regarding their decisions. These same people should never be allowed, again, to have a say about the future of legal education in this state or anywhere else. Indiana already has four law schools. That's probably one more than it really needs. But it's more than enough.

  3. This man Steve Hubbard goes on any online post or forum he can find and tries to push his company. He said court reporters would be obsolete a few years ago, yet here we are. How does he have time to search out every single post about court reporters and even spy in private court reporting forums if his company is so successful???? Dude, get a life. And back to what this post was about, I agree that some national firms cause a huge problem.

  4. rensselaer imdiana is doing same thing to children from the judge to attorney and dfs staff they need to be investigated as well

  5. Sex offenders are victims twice, once when they are molested as kids, and again when they repeat the behavior, you never see money spent on helping them do you. That's why this circle continues