Lack of Billing Guidelines

‘The One Big Mistake organisations make…with Billing Guidelines’

Many organisations still do not have a set of billing guidelines in place with their external law firms before engaging with them on a matter. 

Amazingly, large global clients will engage with a law firm with no terms of engagement/billing guidelines or rates being agreed. When they then get the exorbitant bills from the law firm, we often see the client enter into very lengthy negotiations about what should / should not be chargeable.

Before engaging with a law firm, we would always recommend you have billing guidelines, billing rates and a good scope of work agreed between the parties. This can be done even with the most urgent matter – urgency being the most common reason for companies failing to follow this recommendation.

Without agreed guidelines, law firms should still bill reasonably but why put yourself into a position where you have to enter into lengthy discussions on invoices and on what’s ‘reasonable’?

We have seen firms write off as much as 26% as a result of breaches arising from compliance with billing guidelines – it is imperative organisations agree on billing guidelines and then, more importantly, ensure compliance with these guidelines (requesting write-offs where breaches occur). 

For more advice, please see our webinar and blog post on the key items to watch out for when reviewing legal invoices. Including these items in your billing guidelines will ensure robust management of your legal spend.

At Coote O’Grady, we have put billing guidelines in place with hundreds of law firms in over 48 countries, if you need advice please get in touch at info@cooteogrady.com as we would be delighted to help!