February 24, 2026
Seven years ago, I wrote what turned out to be one of the most popular posts over the course of this blog: Top 10 Reasons the Billable Hour Needs to Go.
News flash: The billable hour is still here, and it is still one of the biggest barriers to access to legal help for everyday people in our community.
The case for leaving the billable hour in the rear-view mirror has long been a strong one, yet it has proven to be remarkably persistent. What is different now with the advent of AI, however, is that it is becoming a business imperative to move to alternate means of pricing that better reflect the enduring value good lawyers provide. And whatever you think of AI (and let’s face it, there is a lot that is scary!), ditching the billable hour is a good thing for all concerned and a good thing for access to justice.
If you never billed by the hour in the first place or have since seen the light, good on you; that puts you way ahead of the curve in adapting to the widespread changes and many opportunities that AI is creating for our profession.
For the rest of us, I have revisited and updated my top 10 list from 2018 for the AI era, and here goes…
10. It’s Opaque
People who might be able to afford the legal help they need often don’t even try to get a lawyer because they have no idea what it might cost or whether it is a good value for the money.
For areas of legal practice where fixed fee pricing is the norm, like bankruptcy, real estate closings, or DUI cases, the market works much better for consumers looking for legal help.
Transparency matters!
9. It Lacks Certainty
Closely related to #10, the billable hour is unpredictable for the client as to what they may be on the hook to pay from month to month, and it leaves the client with little sense of control. Legal matters, of course, often are unpredictable too, and quoting a fixed price for an entire matter may not always be realistic. But the billable hour adds far more unpredictability for clients than necessary, effectively putting all the risk on the side of the client if things are more complicated or take longer than expected through no fault of their own.
8. It Rewards Inefficiency
For most consumer markets, when something is done inefficiently and/or takes longer than necessary or expected, the one holding the bag is the seller of the goods or services. Not so for legal services where the billable hour is the norm. Taking longer than necessary to do something or doing it inefficiently leads to more revenue for the lawyer.
7. It Can Unnecessarily Turn the Client Against the Lawyer
Clients who are paying by the hour (or tiny increments thereof) often become afraid of calling their lawyer when they have questions because they know the clock will be running. And many become skeptical of whether the lawyer had to take that deposition or file that motion, putting unnecessary strain on a relationship that should be one of true partnership between lawyer and client.
6. It Focuses on the Wrong Things
The billable hour focuses on the inputs for a particular legal matter (i.e., the lawyer’s time) rather than the outputs (i.e., how well the client’s goals are achieved). Tracking and evaluation thus tend to focus on the inputs of how much time went into the case rather than evaluating the value that has been provided and the progress towards the client’s goals from the representation.
5. The Value of Time to the Client Is Mismatched with the Price
Unless a client is seeking to nuke the other side or drag out litigation, in which case you should think about whether that is a client you want in the first place, a typical client values getting something done as quickly as possible. But the billable hour rewards delay and additional work.
To take just one example, a lawyer representing a client in a consumer debt matter may be able to get a case dismissed or settled on very favorable terms by simply writing a letter or filing an appearance in court. The lawyer becoming involved immediately changes the power dynamics at play and gives the client significant new leverage. But in the billable hour construct, the lawyer gets less money in that instance (potentially significantly less) than they would if the case drags out, even though the client got high value from the lawyer’s services by successfully resolving the matter as quickly as possible.
4. It Acts as a Perverse Disincentive to Efficiency and Innovation
While I believe the great majority of lawyers operate ethically within the billable hour structure and strive to achieve the best results for their clients as efficiently as possible, there is a not-so-subtle disincentive to spending time and money on technology or other practice management tools to make their legal services more efficient. Doing that just leads to more costs and less revenue for the lawyer, and it is hard to imagine there is not a subconscious effect on lawyers (or anyone charging for their services) in the billable hour scenario.
3. Robots Don’t Bill by the Hour
Even before AI became more prevalent, technology was getting better and better at providing resources and services to us humans that not long ago seemed unimaginable. It also already was creating better tools all the time to make us more efficient and accessible in virtually all parts of our lives, and AI has put that on overdrive.
Whether they are actually a good thing for clients or not, self-help AI tools are increasingly available to people for free or very low fixed prices. For simpler or lower-stakes legal matters where lawyers are already rarely involved, these tools have the potential to be great solutions—more on that in my last post of this series. But clients are going to have access to these tools for more complex and higher-stakes issues too, and lawyers are going to have to sell our unique value and price our services on that basis in this market of increasingly empowered consumers.
2. The Case for Change is Now a Business Imperative
As AI increasingly makes it possible for lawyers to provide their services faster and more efficiently, the billable hour makes less sense as a business model every day.
Time has always been a poor proxy for the value that lawyers deliver, and with the huge leaps in efficiency that AI is going to make possible, that is only going to become more true.
It won’t be right away that the billable hour becomes untenable (and possibly much longer for top lawyers serving the corporate market), but the writing is on the wall, and now is the time to start making the transition. And it is the widespread fear of making that transition that leads me to what remains #1 on my Top 10 list…
1. The Excuses Still Suck
While the business imperative could easily land here, I am still keeping this as my number one.
Most lawyers at least recognize that the billable hour has its faults, but the most common response is that so-called alternative fee arrangements aren’t feasible unless there is almost complete certainty in how much time a matter is going to take (e.g., drafting a will) or the client has a viable matter with money at stake where a contingent fee model can work well. And that is just bunk.
The concept of factoring risk and uncertainty into pricing is a part of just about every other business, but has proven a difficult proposition for much of our profession. Many lawyers and other business entities are in fact figuring out how to offer fixed pricing options (whether a fixed fee for a whole case, fixed fees for phases of a case, subscription fees that are fixed per month or quarter, and/or limited scope representation), including a number of lawyers building successful practices through the CBF Justice Entrepreneurs Project (JEP). It definitely can be done, but not without accepting some risk and being willing to do things differently.
Most lawyers act as though the billable hour always has been the dominant model. The truth is, the billable hour is of very recent vintage in our profession. This video lays out the twisted history behind how we got to the billable hour system as our predominant means of pricing, and it really only became prevalent in the 1970’s. Somehow, the profession survived and thrived for centuries using other pricing models. Aside from the awkward matter of antitrust issues that developed near the end of that era, fixed pricing options seemed to work just fine for everyone, and we can make them work again.
The Way Forward
This post was near the top of the Action Plan for this year’s Resolution for Our Legal Profession for a reason, as we need to free our minds of the billable hour to best use AI and related technology to more efficiently help more people in need who too often struggle to find affordable legal help when they need it today.
To do that, we need to focus on the unique value we provide as lawyers and price our services accordingly, which will be the subject of next month’s post. A clear understanding and focus on that value will be the key to developing better pricing approaches that improve access to justice and are a win-win for lawyers and the clients who need our help.