Billing by the Hour

18Jan07

I HATE the billable hour.

The problems with the billable hour are manifold:

1) It rewards slow work and penalizes the efficient. If I can write a contract in two hours, and the guy across the hall takes four hours, HE gets a bonus at the end of the year. I get reprimanded for not billing enough hours.

In my experience, this tends to penalize better lawyers, who tend to read faster and work more efficiently, with fewer false starts.

2) It encourages lying. Your entire performance evaluation, unless you spectacularly fuck up, as an associate is based on billable hours. I see when people come and go from their offices (and not just here, but at other firms). I see them at social events. I KNOW they didn’t bill 80 hours last week. But that’s what they “bill.”

3) It’s bad for clients, because it lets lawyers charge basically whatever they want. Okay, fine, in a litigation. But a lot of legal work could easily be set-fee — that standard contract is worth $500 whether we have a brand-new attorney take six hours to draft it or an experienced one take half an hour. Why is the exact same work worth different amounts?

4) Did I mention it penalizes efficiency?

I liked working in an environment that was product-oriented a lot better. When you finished the day’s tasks, you got to go home. When I was working as a document monkey on this particularly enormous litigation, it was not unusual at all for me to read THREE TIMES as many pages as the guy across the hall who had the same job in eight hours. He often actually stayed late just to read 1/3 as many pages as I did. So let’s say I read 1,000 pages in 8 hours, and he read 300 pages in 10. (Just for nice round, ridiculous numbers.) *I* would get reprimanded at the end of the week for only billling 40 hours versus his 50 hours, while I had produced THREE TIMES the amount of product for the firm. (And he was always missing deadlines. I was always ahead of them.)

It’s a system of really fucking perverse incentives that rewards someone who works slowly and misses deadlines and penalizes someone who works quickly and makes them. But the only thing that mattered is how many hours we billed.

The IT guy outright told me to lie. “Everybody else is dicking around on the internet playing games for 15 minutes of every hour they bill.” (Billing was via a program the IT guy was responsible for creating reports from weekly — he would check it against internet use logs for his own amusement.) “And most of them are IMing all day long no matter what they’re billing on. You should just write down how many hours you NEED. They don’t care how much work you get done as long as you get the hours, and they’ll never know since you’re getting more done than anyone else at your level anyway.”

You hear that, clients? Joe Attorney is billing you $300/hour for playing poker online. Everybody knows. And nobody cares.

Filed under: billable hours, hours, office, workplace   |  4 Comments