Boo to the Billable Hour: A Book Review

I finished lawyer John Derrick’s engaging and well written book, Boo to the Billable Hour several weeks ago (and in one sitting), but I’m just getting around to posting my review now.  As I’ll describe in more detail below, Boo to the Billable Hour offers a great primer for lawyers who haven’t even thought about getting rid of the billable hour as well as those who recognize some of the drawbacks but can’t come up with a viable alternative.

Boo to the Billable Hour is structured into three main parts.  The first section – and to my mind, the heart of the book – systematically dismembers the billable hour by showing its many drawbacks: its inability to capture the value (rather than price) of time spent, problems with the accuracy of record keeping, difficulties in fairly allocating time to avoid double billing, and (in the law firm context), the billable hour’s incentive to associates to overbill or bill pad to meet a firm’s billable hour targets.  However, I think that Derrick also overlooked another problem with the billable hour that is unique to solos.    Because solos can’t leverage billable hours, they’re salary is limited by the number of hours they bill.  If a solo bills 40 hours a week at $200/hr, they’ll earn $400k a year (assuming 2 vacation weeks) – but they’re also working not much less than large law firm hours.  Unless solos can find a way to get more “bang for the buck” out of their day, they remain slaves to the billable hour.

The second part of the book offers ways to eliminate some of the waste and unethical practices associated with the billable hour.   And the third part of the book explores alternatives to the billable hour, such as flat fees, budget based fees, value billing, staged fees and result oriented fees.  What I liked about this section was its even-handedness.  Derrick doesn’t blindly drink the alternative billable hour Kool-aid; he acknowleges that even some of the alternative methods have problems but that on balance, they’re superior to the billable hour.

Overall, I felt that the part of the book that discussed billing alternatives was not quite as strong as the part of the book that deconstructed the billable hour.  Derrick’s discussion of the alternatives is thorough, and he does offer a few examples of how law firms are using billing alternatives.  However, I’d be interested in a more tangible examples of how to apply billing alternatives in practice – or examples of more law firms using billing alternatives.  And because at the end of the day, our billing practices should be designed to serve clients,  I’d also be interested in learning about whether clients are receptive to billing alternatives.

I’d highly recommend Boo to the Billable Hour to a couple of audiences.  If you’re a lawyer who’s suspicious of billable alternatives,  Boo to the Billable Hour will open your mind to billing alternatives far more effectively than any of the other resource.  And if you’re a lawyer who’s already decided to abandon the billable hour, this book will give you options to consider – as well as arguments to present to skeptical clients.

Foremost,  Boo to the Billable Hour should be required reading in law school business and ethics classes.   I think that most students would enjoy reading about the business of law as well as the discussion that the book would engender.  Unfortunately, the billable hour has become so entrenched for so many lawyers that many won’t spend the time to learn about alternatives.  And that’s why it’s critical to plant the seeds of doubt about the billable hour in law school – so that future generations of lawyers will realize that there’s another, better way of doing business.