4th Quarter Legal Bills Should be Closely Scrutinized

It’s been said with good justification that “a lawyer’s pen gets heavier during the fourth quarter.”

Invariably, as the year nears an end, lawyers (and paralegals) scramble to find things to do in their files in order to make their firm’s hourly billing “targets” (i.e., goals) for the year.  I also invariably see more “drop-in” or “transient billers” show up in files during the last two months of the year than at any other time in the year as lawyers and paralegals beg their colleagues for work to do.

You see a lot depends upon meeting law firm billing targets including firm bonuses and partners’ shares of the profits.  It sometimes may also mean whether or not you will have a job for the next year.  Thus, it is no wonder that I have found that more make work projects and task padding also occur during the final two months of a year that at any other time in the year.

But apart from concerns about the task padding that goes on in the fourth quarter, there is another concern: time padding.  Time padding can also occur when lawyers and paralegals add time to legitimate tasks to try to make yearly billing goals.

Apart from the deliberate instances of time padding, time padding can also occur in other ways.  Inadvertent time padding can occur when lawyers go back through all their files toward the end of the year looking to see if they recorded their time for tasks that might have been completed months ago.  In fact, I reviewed a bill last month for an insurer in which the lawyer had included time from over a year ago.

When lawyers and paralegals do this, it is called “reconstructing” their time. And as many courts and experienced legal bill auditors alike know, when lawyers and paralegals do try to reconstruct their time, they invariably rely upon a faulty memory.  This, in turn, invariably causes them to record more time rather than less time.

To limit the billing errors invariably caused by reconstructing time, billing guidelines should specify a maximum time limit for which the lawyer may bill for services.

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