2025 Billing Rate Increases: Why Detailed Bill Review is Essential
In-house legal teams face numerous challenges as we approach 2025. Amid budget cuts, hiring freezes, and potential law firm rate increases, it can feel impossible to continue doing more with less.
Detailed, human-led bill review paired with dynamic reporting and analysis of spend creates a unique opportunity to manage these challenges while conserving and improving budget, personnel resources, and law firm relations.
Forecasting Attorney Rate Increases in 2025
According to a recent report from Valeo Partners, cited by the ABA Journal, billing rates at leading law firms have been rising, a trend expected to continue into next year. The report indicates that hourly billing rates for senior partners at top firms are projected to climb to nearly $3,000 per hour or more. The report notes that nine major firms currently set standard hourly rates for senior partners between $2,400 and $2,875, with at least 17 more firms expected to reach this range by next year.
Valeo Partners estimates that standard billing rates for the Am Law 50 highest-grossing law firms will range from $1,900 for partners to $2,100 per hour for senior partners. As evidentiary proof of the coming increases, Law.com cited bankruptcy filings that marked the trend. This publicly available data shows rates ranging from $1,560 to as much as $2,720. The report also indicates that third-year associates could have rates as high as $1,000.
While not all corporate teams leverage BigLaw for their matters, the trends point to a larger issue in billing increases overall. The cause and effect mean bigger invoices that corporate in-house legal teams must budget for each year, and it’s not just rates that impact the final bill.
Billing Discrepancies Keep Adding Up
In addition to broader rate increases, billing discrepancies are common and come in various forms. These contribute to overbilling and can prevent teams from achieving goals, gaining organizational buy-in, and maintaining the quality of the work product when opting for more economical solutions. There are dozens of discrepancies to look out for in a bill, these include, but are not limited to:
Common Billing Issues
In addition to broader rate increases, billing discrepancies are common and come in various forms.
Excessive Time
Inadequate Description
Factual Inconsistencies
Duplicative Work
Junior-Lawyer Training
Higher-Rate Staff Used Inappropriately
Block Billing
Overstaffing a task
Intra-office Communication
LegalBillReview.com (LBR) Insight
Real-life Examples from LBR Clients
Client 1: In June, a law firm billed their client 80 hours for a motion to dismiss and 30 for a motion to stay. The previous month, over 100 hours were billed for the same documents.
Results: LBR adjusted two bills from the same law firm by 22% and 24%, respectively.
Client 2: In July, a law firm billed their client 1,088 hours over 115 entries for "preparation" without detailing the tasks involved. Thirty-six entries exceeded 8 hours per day, with 12 from one timekeeper. 12% of the bill was for administrative tasks.
Results: LBR adjusted the bill by a total of $700,000
How to Manage Legal Bill Increases with Minimal Time & Budget
As rates and, ultimately, legal bills increase in the coming months, corporate in-house legal teams can take back some control while maintaining these valuable relationships with their outside law firms. This can be done efficiently and without needing additional budget to make an impact.
The first tool for more control is establishing or updating Outside Counsel Guidelines. If this document is not established or maintained, it is an excellent place to begin.
LBR Insight
Maintaining Outside Counsel Guidelines is like doing a tune-up on your car. Things evolve, including rates, timekeepers, industry benchmarks, etc., and when they do, the guidelines must be refreshed to address these changes. Regular maintenance and communication of guidelines and updates with law firms promote transparency and open dialogue so both parties know what to expect. LegalBillReview.com provides this service as part of the service at no additional cost.
The next step is the enforcement of Outside Counsel Guidelines with a detailed bill review. At LegalBillReview.com, we tailor our approach to review based on each client and their requested approach for each law firm. For example, “Law Firm A” can be reviewed strictly, enforcing the guidelines to the letter; whereas “Law Firm B” can be given grace as they provide free advice to your stakeholders. We operate as a seamless extension of your team providing the flexibility to cater to your team’s specific needs.
Each bill at LBR undergoes a two-part review process: an initial detailed analysis followed by a quality control check. This process is led by highly experienced, US-based attorneys who specialize in relevant areas of law. For every bill, our analysts document billing discrepancies according to the client’s requested approach, using the guidelines as the standard. The quality control reviewer then ensures that each line item has received the thorough analysis necessary to support any adjustments.
LBR Insight
Our analysts undergo rigorous training before they begin reviewing client invoices, ensuring the highest level of expertise and accuracy. Using a two-part review process led by US-based attorneys with deep experience across 20+ areas of law, combined with specialized training, we deliver maximum savings and efficiency for our clients. Unlike other options that often rely on offshore reviewers with limited familiarity with US law, our approach prioritizes quality and legal precision.
Line Item Adjustments - Sample Analysis
Below is a preview of LBR’s sample analysis to show the level of detail provided to law firms. Each line item includes the charges, requested adjustment, and a detailed explanation of why the adjustment was made, referencing the billing guidelines for each discrepancy. This allows the law firm to either accept the adjustment or make appropriate adjustments to the narrative to account for the charge. Our analysts are versed in the matters and benchmarks for the work, including expected timing, staffing, and other nuances.
Single line adjustment from LBR’s Sample Analysis
Positive Law Firm Relations in Bill Review
Once an invoice is adjusted, it is shared with the law firm. If questions arise, LegalBillReview.com’s Law Firm Relations team handles discussions about the findings directly with the firm. These conversations are constructive and positive, led by a former Am Law 200 partner and team.
LBR Insight
“With our intentional and thoughtful approach to our clients’ law firms, we’re able to resolve concerns quickly. Last week, I saw a resolution as quickly as 17 minutes from the moment the appeal was first received!”
Sarah Wagner, Director of Law Firm Relations
“If a law firm pushes back on adjustments, we often start the conversation by asking, ‘Where did we go wrong, and how can we work together to resolve this?’ Our focus is on the guidelines and resolution—not causing friction or frustration.”
Brian Arbetter, General Counsel, VP of Compliance/Law Firm Relations
Spend Analysis & Reporting
Like many departments, legal teams face reporting challenges. Effective reporting can help pinpoint problem areas to address. With spend analysis, in-house legal teams can identify the frequency of billing discrepancies by law firm or matter, as well as many other metrics. This visibility can prepare teams for constructive conversations that minimize future accidental or unethical overbilling practices.
As part of our service, we offer a real-time legal spend reporting dashboard that includes a variety of customizable reports. Additionally, we send quarterly savings reports to stakeholders for review and tracking purposes. This benefit is included at no additional cost.
Conclusion
In-house legal teams using LegalBillReview.com save an average of 12% on legal bills through our detailed, two-part analysis. Now is the time to plan for 2025 and start conversations with your law firms. Open dialogue, supported by Outside Counsel Guidelines, safeguards these relationships by focusing on the practical process of managing bill review, not just the expense. LegalBillReview.com can assist as a seamless extension of your team, allowing your valuable personnel to focus on legal matters. While rate increases in the forecast may be daunting, you can have control and visibility without needing to expand your budget.
Learn about our Zero Risk, Zero CapEx, and Zero Implementation pricing. We guarantee that you will never pay more than the original bill amount for our support and services.
Schedule a call for a free assessment and receive a copy of our Outside Counsel Guidelines to jumpstart your legal spend prep.
