Question of the Week: What Should I Know About Billing Types and Time Tracking?


Many attorneys who bill their client on a flat fee or contingency basis often wonder if they need to track their time if the invoice amount isn’t dependent on hours worked. While recording time takes some effort, the business value it provides is well worth it. From maximizing profitability to avoiding malpractice claims, the benefits associated with tracking time regardless of billing type makes it a must.

Benefits of Time Keeping

Working on a contingency basis means you don’t paid if you don’t win the case, whereas with flat/fixed fee cases, you know from the start what you’re going to collect on a matter. Even if you’re not sending out monthly invoices to clients, tracking time will help you make sure you’re making a profit on these cases and your rates are sufficient. For example, if you’re charging $2,000 for a specific matter type but see you’re putting in 20 hours, you’ll know you need to either raise your rates or address inefficiencies.

Another key reason to track time is the possibility of recovering attorney’s fees. If the case is eligible to seek attorney’s fees from the opposing party, you’ll need to prove those fees are reasonable. The costs should be submitted with invoices for time and cost records, otherwise the court will have a hard time substantiating the amount requested.

You also want to protect your firm in the event a client switches firms in the middle of the case, using tracked time to ensure you still collect attorney’s fees. The firm will also be better protected against malpractice cases for inadequate representation and provides a way to keep clients updated on the work being done to avoid being in that situation. These time logs will also help if you need to go back and review a case by providing a quick overview to scan.

To learn more about why time tracking is so important for each of these case types, check out Time Tracking For Contingency Fee Cases and Time Tracking for Fixed Fee Cases.

Tracking Time Effectively

The biggest hurdles to time-tracking are how much effort it takes to create entries and when they can be created. To be done effectively the process needs to make it easy to enter time as it happens. Waiting to get back to the office to put in time entries often results in missed time and inaccuracies.

Rather than having to wait to get back to the office, today’s cloud-based technology makes it possible to create entries from anywhere. The rise of legal-specific programs has resulted in apps that can be used on any phone to allow for quick entries on the go. Many legal-practice management programs also tie these apps directly in their software, making it simple to see how much time has been spent on each case without needing to take any extra steps.

No matter how you choose to do it, it’s critical to your firm’s profitability and overall protection that you track time regardless of billing type.


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