No, the billable hour regime is not unethical…

How many times have we heard this?: Socialism and communism aren’t bad theories, they just haven’t been tried by the right people yet.

Well, the same is said about the billable hour. Oh, no, it’s not inherently unethical, doesn’t misalign the interests of professional and customer, and with the right person it’s a fine system. Anyway, you can’t condemn hourly billing just because a few people cheat the system.

Really, just a few? Check this article out.

This is precisely why economists aren’t concerned with compliance. They are concerned with incentives. There’s no good way to implement the wrong theory.

There’s no way any of this type of billing chicanery could happen with fixed prices quoted up-front.

When will the legal profession learn?


  1. Matthew Tol says:


    Interesting article – just shows how the “smoke and mirrors” perception gets out there.

    No doubt the time was spent, but what value was added as part of that process.

    The more that this sort of information gets out there, the more people will begin to question things.

  2. This is spot on, Ron. It reminds of this passage that I’ve often quoted from David Maister’s True Professionalism: “Any firm that emphasizes and rewards its professionals for large amounts of personal billable hours (or ?utilization?) creates an incentive for people to find ways to maximize the bill on every engagement (perhaps subconsciously) in order to get credit for as many billable hours as possible. Not surprisingly, clients are increasingly suspicious that this system encourages inefficiency, since the more time it takes the professional to do the work, the more the professional gets paid. ? Clearly, the ethical and professional thing to do, as the client?s agent, is to work hard in order to achieve the client?s goals at the minimum possible cost to the client on each transaction.”

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