A recent report released by a legal industry consulting service warned clients of law firms of several practices it found to be “red-flag” billing practices, including so-called “upbilling” and block billing, as well as billing for a six-minute increment in connection with a momentary task. The report was put together by CEB Inc. and Wolters Kluwer NV’s ELM Solutions, two companies that consult with clients of law firms in the ever-expanding industry of helping those clients dispute the invoices they receive from law firms and thereby reduce their bills. While some lawyers and law firms may debate whether some of the practices targeted by the report are legitimate business practices are not, it is important for law firms to understand that their clients are being made aware of these practices as red flags to be potentially disputed.
Upbilling Raised Top-Billing Lawyer Bills by $29,000 a Year
Perhaps the most striking finding in the report was that 21% of attorneys engaged in the practice of “upbilling,” meaning they rounded up their billable time for tasks to the next half-hour or hour. This finding was based on a review of invoices for legal bills at around 100 companies. The report estimates that, for a partner billing 2,000 hours a year, this meant an additional $29,000 billed for just that attorney.
Another issue addressed in the report was the prevalence of attorneys who billed for a single, six-minute increment of time on a bill, with the report suggesting such tasks would not be appropriately billed in this manner as the tasks would take a fraction of that time. The report found that 51% of attorneys engaged in this practice.
The Problem With Block Billing
The report also addressed the problem of block billing, which is where an attorney puts a number of separate tasks in a single time entry for a bill. This is a common complaint of legal clients, as it makes it difficult for them to budget accordingly for the various tasks included within the block of tasks, and also leads to suspicions of poor or inaccurate timekeeping.
According to the report, around 2 out of 5 attorneys continue to engage in this outdated practice, although automated billing solutions such as TimeSolv make it easy for attorneys to continuously input single billing entries from any location at any time.
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