Legal billing guidelines, also known as outside counsel billing guidelines, are a great way for legal departments to communicate their expectations of their law firms and vendors. However, without dedicating the time to carefully craft your billing guidelines, they likely won’t be followed or adhered to. Not only can this result in subpar work from your law firms, your team will waste valuable time and resources combing through invoices to identify and rectify over billing issues.
Whether you’re creating new legal billing guidelines or evaluating them for areas of improvement, we’re sharing four quick tips that can enhance your guidelines and promote collaboration with your law firms for superior outcomes.
For even more detail around creating and evaluating your legal billing guidelines, as well as strategies for communicating and enforcing them with your law firms, download Legal Billing Guidelines Best Practices – our latest guide with sample outside counsel guidelines included!
1. Clearly Define Your Expectations
Your legal department expects good work from its law firms, and law firms want to deliver and meet this expectation. However, your law firms can only meet this goal with your help! Define your expectations and provide criteria for what “good work” means.
A good starting point is to ask yourself the following questions. The answers, which will be unique to each legal department and company, can then be communicated within your outside counsel guidelines for complete transparency.
- Is it important for law firms to understand the company’s overall business objectives?
- What level of domain or subject area knowledge is expected?
- Is achieving the desired outcome for a matter used to determine whether or not a firm will be used again?
- Is efficiency or the outcome the more important factor of determining law firm performance?
- Is responsiveness measured?
Keep in mind that law firm measurement is a large project; it’s more than text in a document. If you are measuring your law firms based on performance metrics, sharing your process with each law firm you work with is a must, and will go a long way in ensuring that you’re both on the same page when it comes to expected outcomes and quality of work.
2. Provide Examples & Definitions
Law firms work with a wide range of clients, all who have their own billing guidelines and billing expectations. Don’t fall into the trap of assuming that your law firms define terms the same way your legal department does. When applicable, provide examples and definitions within your billing guidelines.
The following table is an example of how to provide your law firms with clear directions so they understand exactly how to bill:
3. Avoid Extra Text
Billing guidelines have a reputation for being lengthy and difficult to digest. The longer your billing guidelines get, the less they are read and adhered to – no surprise there! Best practice is to avoid any extra text that does not provide your law firms with clear direction or impact how the firm staffs, bills, or completes work on a matter.
This doesn’t mean that you can’t revise your guidelines if you already have them in place. In fact, billing guidelines should be viewed as a living, breathing document that is reviewed on an annual basis. Updates can then be made when changes take place within the department or company. For instance, if your legal department implements an e-Billing and spend management solution for electronic invoicing, your billing guidelines must be updated to reflect the new invoicing process and expectations around how law firms should interface with the solution.
4. Breakout Important Points in Bulleted Lists
All too often, lists of important requirements are buried inline, making them difficult to parse out from heavy blocks of text. Because these requirements are vital to successful billing, make sure they’re easy to read. One of the best ways to achieve this is by splitting out important requirements as a bulleted list.
Bulleted lists help ensure that the individuals and teams who are actually responsible for following your guidelines won’t miss information vital to the billing process. Of course, a contract lawyer would likely read through your billing guideline document in its entirety, but other teams such as finance or billing might miss items that aren’t specifically called out.
How would you rate your legal billing guidelines?
If you want to see how your billing guidelines stack up, or are in the process of creating them from scratch, download our latest guide, Legal Billing Guideline Best Practices. It provides corporate legal departments and legal operations teams with information on creating and evaluating guidelines, communicating them with law firms, and strategies for enforcing them.