Diminishing Returns: How Many Billable Hours Is Too Many?

Posted September 14th, 2021.

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By Dylan Jackson

What You Need to Know

  • There is a point where working a lot of billable hours leads to poor outcomes, but it varies depending on the person.
  • Burnout isn’t new, but the pandemic has created additional stressors, making this seem like a tipping point for many.
  • Firm leaders are looking for ways to ease that stress, including unplug time and lower hours requirements.

By now, it is well known that this year has been defined, at least in part, by the furious pace at which lawyers have been working. At what point do high billable hours mean diminishing returns for both the lawyer and the firm?

As with most things—it depends.

“So how many hours is too many hours? Nobody can decide that for an individual,” legal consultant Sharon Meit Abrahams said.

Even David Sanford, chair of Sanford Heisler Sharp, whose firm recently reduced its billable hour minimum by about 20 hours per month, didn’t draw a line in the sand. “I don’t have a number in mind as to what’s too high,” Sanford said.

Of course, New York attorneys billing up to 3,000 hours in a given year isn’t unheard of. The specific threshold for considering oneself “overworked” depends on the person, Abrahams said, and what other responsibilities they have, such as raising children.

“But it also comes down to the fact that some people thrive at this kind of pace and some people don’t,” Abrahams added.

While it is perhaps difficult to pinpoint when one is overworked and billing too much, the effects are more clear. First and foremost is the damage overworking can have on an attorney’s mental health, including a feeling of falling behind at home and not being able to be present, physical effects and, in acute cases, substance abuse.

“Burnout is an absolutely real thing, and lawyers have been burning out since the beginning of time. That’s why every bar has a lawyer assistance program,” Abrahams said.

Then there are the effects on firms. Altman Weil consultant Jim Cotterman said that working at an unmanageable clip has a whole host of downsides: productivity declines, problem solving lags and the risk of malpractice increases. For the firm, pushing attorneys too hard can lead to high attrition.

Overworked attorneys may leave their firm for another, go in-house or even leave the industry all together.

And it is apparent that many attorneys are suffering under a crushing workload, as evidenced by the flurry of raises and special bonuses in part aimed at retaining overworked attorneys, as well as responses to the American Lawyer’s 2021 Midlevel Associate Survey.

“The combination of very strong market activity and client demand, the ‘always on’ feeling of remote working, and family care, social issues and the many other significant stresses of the past 18 months have definitely led us to what is feeling for many like a tipping point,” said Siobhan Handley, Orrick, Herrington & Sutcliffe’s chief talent officer, in an email.

While salary increases can be effective, it doesn’t directly address the issue many attorneys face—lack of time—and can create even more incentives to bill, to justify the increasingly high salary, observers say.

“A lot of our practice groups are working well above normal billable hours requirements,” one Dechert associate recently told Law.com, speaking on the condition of anonymity. “Compensation increases “seem to be mostly a tactic for firms to keep their best talent from lateraling in some cases just to get a week or two off of work and to get out from under above-average work loads.”

At Sanford Heisler, attorneys have been working well over the firm’s billable hour requirement. Last year, the firm saw its attorneys bill 2,400 on average. Sanford, and the firm’s, philosophy is that their lawyers will have years where they approach 3,000 hours due to a trial.

“I do know that some years simply require extraordinary effort because people are preparing for trial or in trial. We’ve had trials that last for months on end,” Sanford said.

But afterward, Sanford said, he expects hours to drop either in the months or year following, even below the minimum.

“You might bill 3,000 hours in a year just working on a trial. But the next year, the expectations should be that you get a break and you work under the minimum,” he said. “If you send that message, people are going to better weather the storm of a trial and the sacrifices one has to make.”

To act in a more concrete way, Sanford Heisler lowered its billable hour requirement from 2,160 hours to 1,920.

Orrick has instituted a required 40 “unplugging” vacation that counts toward bonuses and has designated “unplug buddies” to cover client needs in their absence. The firm also hands out “wellness dollars” to associates, to be used for self-care after intensive months of billing more than 250 hours.

In November, Orrick launched a caregiver relief program for parents who cannot rely on outside child care, where parents can work at 80% of their schedule while still getting full compensation. Twelve associates participated—three men and nine women.

“This is always a challenge in a service profession and global environment—and we’re experimenting together how we manage it today and for the new workplace. We recognize that sustaining top performance requires making time for recovery and self-care,” Handley said.

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