QWERTY Keyboard Lawyers - Inefficient and Less Value to Clients
A recent court appearance provides an example of what any company concerned about reducing unnecessary costs should be aware of when it comes to managing outside legal counsel.
Specifically, I was in court last month in relation to a hearing on a motion in a sexual harassment / wrongful termination claim I'm defending. A fairly prominent attorney from a major Metro Detroit law firm was also sitting in the bleacher seats waiting for his case to be called.
When his case was called, he approached the podium with another attorney who he introduced as his partner. The attorney proceeded to explain that his motion was unopposed and that opposing counsel had actually agreed to the relief requested.
Bluntly speaking, it made no sense for two attorneys - partners no less - to attend a hearing on a motion that a judge routinely grants. In fact, these types of motions are what newbie attorneys cut their teeth on when first practicing law, which makes sense: It gives a new lawyer the opportunity to get court room experience, at a lower cost to the client.
This incident reminded me that being an attorney often has more in common with the QWERTY keyboard than creating meaningful value for clients.
The QWERTY Keyboard and Intended Inefficiency
The modern keyboard, called QWERTY because of the placement of first six letters on the top row of the keyboard, was developed in the 1870s by Chistopher Sholes. An explanation for the nonsensical placement of the keys was to reduce the efficiency of typists who would otherwise cause the keys of early typewriters to jam.
In other words, the QWERTY keyboard was designed with the intention to be inefficient. One blogger,Darryl Rehr, has bluntly described the design as making "no sense. It is awkward, inefficient and confusing ..." It also makes no sense in light of the advancement in computers and word processors that are intended to improve efficiency not reduce it.
The Inefficiency that is the Attorney's Billable Hour
Similar to the QWERTY keyboard, the "billable hour" is the dominant fixture for delivering legal services. Time, generally measured in increments of tenths of an hour, is often the measuring stick used to deliver legal services. So however long a particular task takes - researching a legal issue, a phone call, traveling to court, etc. - that is how much time a client will be charged for legal services.
Going back to the above example, what value did the client receive in having two experienced lawyers, both partners at a major metro Detroit law firm, attend an unopposed motion that the opposing lawyer actually agreed to the relief requested? Like the QWERTY keyboard, this decision made no sense and was an inefficient use of the client's resources.
Steps Companies can take to avoid QWERTY Keyboard Legal Services
The purpose of this post is not to embarrass or call out any of the attorneys referenced above. In fact, I've gotten to know the prominent attorney referenced above having had several cases on opposite sides of him and his law firm; He is a nice guy, sharp and professional.
But similar to early word processing that depended upon built in inefficiencies for success, this attorney's law firm, like many law firms, depend upon generating billable hours for their financial success. But that metric essentially defines a lawyer and the law firm by quantity of the work, not quality, which is no strategy for a law firm's long-term financial success. See John Grimley over at the International Business Development Blog who recently reported about law firms looking to survive need to recalibrate their focus on becoming lean and efficient providers of legal solutions.
So for companies defending any lawsuit - not just an employment related lawsuit - it is important to carefully scrutinize your law firm's billing practices and specifically address the misalignment created by hourly billing in order to reduce excessive lawyer fees. In this regard, here are a few points of consideration:
- How will a case be staffed?
There are a number of legitimate reasons for staffing the defense of a lawsuit with more than one person. For instance, paralegals and associate attorneys will have a lower billable rate than a more senior-experienced attorney. And it is not necessary for a senior attorney to perform tasks requiring less or no analysis. So ask this question and make sure the staffing is reasonable in relation to the issues presented - not your company's bank account.
And as invoices are provided, be sure to review them to confirm staffing makes sense. If it is not immediately apparent if this is true, follow up with the law firm. There may be a good explanation for it. Or, like the example above, you may be reminded of the saying that pigs get fat, hogs get slaughtered.
- What are your available billing options?
Billable hours are not inherently evil, but it does create an incentive that is contrary to the client's best interests. It is, therefore, important to have a certain level of trust in your attorney that work performed is necessary or has a likelihood of returning a measurable return on investment. My own measuring stick for this requirement is to make legal decisions as if I was spending my own money.
Also, billing on an hourly basis should not be the only option, so consider discussing other billing alternatives that align your interest with the attorney.
- What is the billable hour requirement at the law firm and how are bonuses determined?
The answers to these questions will probably give you the best insight as to what you can expect from a law firm and its attorneys. By way of reference, a common yearly billable hour requirement for Metro Detroit law firms is 2000, but I've had friends at law firms where that number shot up to 2,300 or dropped to 1800 with bonus incentives built around the minimal requirement.
In this regard, the billable hour is both the "carrot" and "stick" for the attorneys working on your matter: The carrot in that bonuses are doled out based on time billed in excess of a certain number and the stick that if a certain number of billable hours is not reached, then the attorney has not met the law firm's minimal billing requirements (never a good thing for job security and financial success).
In either event, you have attorneys - partners and associates alike - motivated to "survive" by hitting their hourly marks and to thrive by exceeding those marks. The hours needed to hit those marks must come from somewhere and the question is, how many hours will come from your matter? But lost in this equation, however, is an assessment of how many of those hours provide meaningful value to the client - as opposed to "garbage hours. Sending two attorneys for an unopposed motion is a prime example of garbage.
For more information about billing arrangements that are more in line with business objectives and corresponding values, please see our commitments we promise to deliver to clients.