In the previous In-House Connect webinar “Stop Wasting Time Reviewing Outside Counsel Bills: Simple Strategies to Save on Legal Spend for In-House Legal Teams,” experts Shai Mehani, CEO and co-founder of In House Connect, and Brian Arbetter, GC and VP of Compliance at legalbillreview.com, delivered actionable insights on managing and reducing legal expenses.
Here are the five key takeaways from the webinar:
- The Pitfalls of Block Billing
Block billing, a practice where multiple tasks are combined into a single time entry, is widely discouraged due to its potential for overbilling—often by as much as 20%. To combat this, it’s recommended to include formal guidelines that require adjusting block billed entries by a set percentage if violated. This ensures transparency and fairness in billing practices.
- Establishing Robust Billing Guidelines
The importance of well-documented billing guidelines cannot be overstated. These guidelines should cover the timeliness of invoicing, reasonable research time limits, and expectations for billing descriptions. Sharing these guidelines with your outside law firms and updating them annually empowers you to manage billing excesses effectively and push back against unreasonable charges.
- Rejecting Vague or Duplicate Entries
One frequent issue with law firm invoices is inadequate descriptions and duplicate charges. It is essential to establish clear narrative standards for billing entries to evaluate the value of services accurately. Encourage outside counsel to provide detailed, specific descriptions and collaborate with them to address duplicate entries, which may arise from technical glitches or recording delays.
- Negotiating and Reducing Excessive Costs
Engage in productive dialogues with your law firms about fee arrangements. Consider negotiating fixed rates, seeking discounts for excessive research time, and stipulating reasonable rates for tasks based on the seniority of the staff involved. For instance, avoid high-cost attorneys performing basic or administrative tasks. Pushing back diplomatically but firmly can lead to significant cost savings.
- Utilizing Performance-Based Review Services
Companies like legalbillreview.com offer services where they review law firm bills line by line, handling conversations about overbilling and negotiating lower amounts without jeopardizing relationships. Their pricing model includes a performance guarantee, ensuring that any significant savings found go back to the client, making them a valuable resource for managing legal expenditure.
The webinar illuminated key strategies for spotting, addressing, and managing excesses in outside law firm billing, providing essential tools for in-house legal teams. By focusing on transparent billing practices, setting comprehensive guidelines, negotiating fees, and utilizing specialized review services, in-house counsel can significantly reduce legal spending and enhance their legal partnerships’ value.
Missed it? You can watch it now via IHC On-Demand!
