If you’re a lawyer, you already know what the term “billable hour” means. And if you’ve ever hired a lawyer, you really know what the term means. It’s the economic foundation of the entire legal industry, but its days may be numbered. Here, I’ll explain what a “billable hour” is, why it’s a bad system both for clients and for lawyers, and then I’ll offer an alternative.

A billable hour…. what is it?

Lawyers charge for their services, just like everybody else, and a billable hour is the basic unit of service. Each lawyer has an hourly rate, which clients pay. In big cities like Chicago, rookie lawyers usually charge about $200 per hour. Most lawyers charge their clients in tenths of an hour, or six-minute increments. For example, 1.1 hours (66 minutes) of time from a rookie lawyer costs about $220. For every year that a lawyer has been practicing, her rate goes up. By her fifth year as a lawyer in Chicago, for example, a lawyer will typically charge about $300 per hour. Veteran lawyers (or very prominent ones) can get away with hourly rates as high as $800 per hour.

There are two ways to charge people for your products. The first is a service-based model, like the billable hour, where clients pay for the amount of time it costs to perform the service. The second is a product-based model. Candy bars, for example, are sold as products. A Snickers bar these days costs about eighty cents. That cost covers the whole process: manufacturing the Snickers, shipping it and even advertising for it. A portion of your eighty cents even goes toward stuff like the annual Christmas party at the Mars company headquarters in Virginia.

In today’s legal world, a billable hour is the same thing as a candy bar. It’s the lawyer’s “product”. Lawyers are not alone in charging service-based fees; auto mechanics, home cleaning services and many types of doctors do the same. A billable hour is simply a product, like a candy bar.

How is this bad for clients?

The biggest problem with billable hours is that it puts the incentive for a lawyer in the wrong place. Lawyers charge clients for their time, not for their work, which means that as a lawyer, the longer I spend working on a project, the more money I make.

Think about that for a minute. Let’s say I spend ten hours writing a brief. At a billable rate of $250, the cost of that brief is $2500. Suppose the brief could have been written in five hours instead of ten. But spending five hours on the brief earns the lawyer only $1250. In other words, as a lawyer, the longer it takes you to do something, the more money you earn.

Compare this to mowing your lawn. Suppose I were to pay you $10 to mow your lawn. Nobody really likes to mow the lawn, so you try to do it as quickly as possible. Let’s say it takes you an hour. But, now suppose I were to pay you $10 for every hour it takes you to mow the lawn. That hour would turn into two or three. The incentive would be to take as much time as possible to finish mowing, even if it could be done a lot faster. When you charge for your time, the incentive is to go slow.

There are limits to this, of course. Lawyers won’t charge you more than they think you’ll pay, because they want to keep you as a client. So if a client will pay $2000 for a brief, the lawyer won’t charge more than that. But if they can get away with it, they’ll charge $2000 for the brief even if the cost of writing it was less than that. This is true not because lawyers are bad people, but because the billable hour system provides an incentive for lawyers to take as much time as they can doing a project, even if it could be done more quickly.

For a lawyer, efficiency is measured by the number of hours it takes to do something versus the number of hours that get billed to the client. For example, if it takes me 20 hours to write a brief, but only ten get billed, I’m only 50% efficient. But if it takes me five hours to write the brief, that’s even better, right?

Actually, no. If I spend only five hours writing the brief, then only five get billed. If I could have spent ten, then I’ve just lost five billable hours. At a $250 price tag per hour, five hours is a lot. If a client will pay for ten hours, then spending five hours is 50% efficient.

But wait. I thought 20 hours was 50% efficient. So is five? Yes. And that’s the problem. Efficiency is not speed; it’s how close you are to what you think the client will pay. The incentive for lawyers is therefore not to do things quickly, but to spend as much time as possible working on something without going over the amount of time you think the client will pay for.

Most lawyers will swear up and down that they don’t do this. And for good lawyers (like me), that’s actually more true than not. But in the era of the billable hour, it’s little wonder that the legal profession has such a bad reputation. We’re not paid to work quickly, or even to work hard; we’re paid to spend time.

Ok, but how is this bad for lawyers?

Believe it or not, the billable hour system hurts lawyers too. A law firm is a business. And like any business, the goal is to make money. Lawyers are therefore judged on the amount of billable hours they generate per year. In most big law firms today, lawyers are expected to bill about 2000 hours per year.

Suppose you’re a great lawyer, and you’re just quick. Suppose you can do in five hours what it takes the average lawyer ten hours to do. Because you’re so fast, you only bill 1500 hours in a year. That’s good, right? You’re faster than the guy in the office next to you and your clients are happy because their bills are lower. Awesome, right?

No, because congratulations, you’re fired. If you fail to meet your annual billing requirement, you get shown the door. This is true even if you’re a great lawyer who can simply do things faster than everyone else. The product of a law firm is billable hours, and the goal is therefore quantity, not quality. In an industry where time is the economic unit of trade, good work done fast is actually bad work.

In any law firm, lawyers are measured by the amount of time they spend working. The more billable hours a lawyer has, the more valuable she is to the business. Whether she’s a good lawyer or not is a secondary consideration. Sure, it matters, but it doesn’t matter that much. Good lawyers — particularly good and fast lawyers — are consistently passed over for promotions and bonuses at the end of the year. This is a bad thing for the legal profession, because the most valuable lawyers end up being the ones who work a lot, not the ones who are the best.

True story: A friend of mine at a big firm was once assigned to review some documents in preparation for a trial. The documents were stored on a CD-ROM, and there were thousands of them. His job was to review the documents in search of a particular name. We’ll call the name “Bob”. He used a computer search program to run through all the documents, and then he read through the hundred or so documents the computer identified as including the name “Bob”. The whole process took about two hours. Another lawyer at the same firm didn’t follow that process. Instead, he printed out the thousands of documents and reviewed all of them by hand. His process took about 18 hours, and he ended up with the same hundred or so. His work took longer, and was therefore more valuable. Not surprisingly, he had billed his 2000 hours at the end of the year, and was rewarded for a job well done.

Time, not skill, is the object of the game. This does not bode well for young lawyers who also want to have a life outside of work. Reaching 2000 billable hours per year is actually quite hard. A recent survey by the American Bar Association found that lawyers on average spend three hours at work for every two hours billed. To bill 2000 hours per year, the average lawyer will therefore need to spend 2667 hours working. That’s seven and a half hours per day, including weekends and holidays.

29% of every year is occupied by weekends. In other words, if you work Monday through Friday every week for one year, you’ll spend 259 days working. To bill 2000 hours as a lawyer, you’ll need to spend 10.3 hours working every day if you want to have a life on the weekends. And that’s assuming that you work on all holidays and never take a vacation.

In 1958, when billable hours were just beginning to come into vogue in the legal profession, the American Bar Association concluded that there were 1300 billable hours in any calendar year. (They were assuming, by the way, that every lawyer will work half a day on Saturdays.) If you tried billing that much as a lawyer today, you would be fired, and quickly. Not only do most big firms today require 2000 hours per year, but the currently popular thing to do is to increase the requirement to 2200. Sure, associates at these firms make gobs of money; the market average in big cities has now reached $135,000 just for the rookies. But having a life? Forget about it. Do the math, and you’ll realize that that massive salary comes at a massive price.

The billable hour system increases the price clients have to pay, passes over good lawyers in favor of slow ones and destroys the lifestyle of lawyers who are caught up in it. Great system, huh?

So how do we fix it?

Easy. We simply switch to the candy bar system. Instead of selling their knowledge and skill in chunks of time, lawyers could sell their knowledge and skill according to some kind of product.

For example, remember that brief that takes about ten hours to write? In a billable hour system, we charge $2000 for it at a $200/hour rate. Under a product-based system, it would still cost $2000, whether it took five hours or twenty. The incentive for the lawyer would be to write the brief quickly, because the price is the same no matter how long it takes. If the client will pay $2000 for the brief, then that’s what it’s worth, no matter how much time was spent making it.

Under the product-based system, the underlying value of the work is the same: the work is worth exactly what the client will pay for it. That’s just economics. (You’ll pay eighty cents for a candy bar, and that’s why a Snickers costs exactly that much; not a penny less or more.) But the incentive involved in the work changes: Lawyers would no longer have the incentive to spend as much time as possible. Work would get done faster.

But it would it get done well? Sure. If you write a bad brief for the client, you’ll lose the case and the client won’t come back. The incentive in a product-based system would be to work fast, but it would also be to work well. In that system, “good” and “slow” would no longer be synonymous. Instead, “good” would simply mean “good”. Under this system, mowing the lawn would take an hour, because that’s how long it takes. Clients would get their work product faster, lawyers would be home to spend more time with their families and no one would lose a single penny in the process.

Skeptical lawyers will now ask, “Ok, but how do you value the work product before you begin working on it?” In other words, how do you know the brief will cost $2000 before you begin writing it?

For one thing, most lawyers end up doing the same kind of work over and over again. A lawyer who specializes in real estate, for example, is going to attend a lot of house closings. Over time, she’ll simply develop a knack for knowing how much a house closing is going to cost. After just a few years, she’ll be able to estimate with incredible accuracy exactly how much any given closing will cost. I also think that lawyers — the good ones, anyway — have an innate ability to guage whether a legal project is “easy” or “difficult”. The easy stuff costs less, and the hard stuff costs more. The question, “how do you value work before you start it?” is therefore relatively easy to answer. Most lawyers already know the answer; it’s called an estimate.

Lots of industries already do this. When a builder gives you an estimate for remodeling your home, for example, the estimate is based on years of experience as a builder. He just sorta knows how much it’s going to cost to remodel your kitchen. Lawyers are no different; we just kinda know how hard it’s going to be to write that brief. The only difference is that in a product-based system, lawyers would know value without equating value with time.

And that will make all the difference. Imagine a work day of only seven or eight hours instead of ten or eleven, where the quality of your work at the end of the day was measured by how good it is, instead of how long it took. That’s the product-based system.

Depending on who you ask, the word “blog” is either the holy grail of new-age rhetoric, or it’s a four-letter word rife with danger and risk. Maybe both are true. Some people have made millions from blogging. Others have been fired, or even sued. Unless your blog is about knitting or flowers, you’re likely to offend someone at some point. That’s why when people talk about blogs, they almost always talk about what you “can” or “cannot” say on a blog.

I got curious about this recently, and decided to look into it. Can you be fired for writing about work on a blog? Can you be sued for making fun of your boss? Can you be sued for writing a post that isn’t true? What if you post anonymously; can you be sued for that? Luckily, I’m a lawyer. So I decided to look it up.

Unfortunately, it takes the law a long time to catch up to new trends in society. Ever watch molasses crawl? Well, the law is slower than that. A lot slower. Some of the “law of blogging” is still being ironed out, and the big cases are just now reaching the highest state courts. Nonetheless, there are some laws out there you should know about if you write a blog or post to one. On this page, I’ve done my best to cover the general rules.

Two quick notes before we get started. First, remember that laws can vary from state to state. I’ve done my best to generalize here, but the law in your state might be a little different. If you have a question about your state in particular, shoot me an email and I’ll try to figure it out. Second, remember that the “law of blogging”, like all law, is changing constantly. Consider this a status report; it’s good for today, but maybe not tomorrow. That said, let’s get going.

Can I get fired for blogging?

Basically, yes. Most of us are “at will” employees, which means we can get fired at any time, for just about any reason. However, there are some things you can’t be fired for saying or writing. If the purpose of your blog is to organize a union, or to talk about workplace conditions (such as health and safety), the National Labor Relations Act protects you from being fired. But that’s a pretty narrow category, and the general rule is that if your employer doesn’t like your blog (or your haircut, for that matter), you can definitely be fired for it.

If you work for the government, or you’re a contract employee, things are a little different. In those situations, you have a bit more freedom. It’s complicated, but basically you have a limited right to free speech while you’re at work if you work for the government. In any event, if you’ve been fired for writing a blog about unionizing, or health and safety conditions at work, you should see a lawyer about filing a suit for wrongful termination.

What if I wrote my blog at home and it had nothing to do with work?

This question is a bit trickier, because the answer varies from state to state. Some states (California, New York and Colorado, for example) have laws which prohibit an employer from firing you for political activity (like writing a blog) done outside the workplace. Even in states that don’t have a similar law, some cities have enacted a local ordinance that has the same effect. Basically, whether you’re protected for blogging outside of work depends on where you live. But even in states where you’re protected for blogging outside of work, you can still be fired for blogging about work, even if all your posts are written from home. Remember: If you’re an at-will employee, blogging about work is a bad idea, even if you always blog at home.

Can my employer monitor my blogging?

Sadly, yes. The legal trend today is that employees have very little right to privacy when they’re at work. Your employer can monitor your blogging, even if you’re writing about something harmless like knitting or flowers. The same goes for personal emails. Exercise great caution when writing personal emails at work, because your employer probably has the right to read them.

I have more questions about being fired for blogging at work. Who should I talk to?

The Electronic Frontier Foundation has an awesome website on this topic, which you can read here. Or, post your question on this website, and I’ll try to point you in the right direction.

I’m kinda freaked out by all this. Should I continue to blog?

Yes, definitely. If you want to write a blog, but you think it might get you fired, you can always try to do it anonymously. Of course, be careful to cover your tracks. Don’t include information that could identify you, don’t publish your name, and use an IP address anonymizer like this one to make it hard for people to track your location. My view is that blogging about anything, including work, should be protected speech. Unfortunately, the law isn’t quite there yet. In the meantime, use the tips above, but remember that the general answer to “should I blog about work” is basically no.

Can I be sued for blogging?

Again, the answer here is yes. There are really two kinds of lawsuits you need to be concerned about: defamation and copyright infringement. We’ll take these one at a time.

Defamation is a (1) negligently made (2) false statement (3) about a third party. Translated into English: When you say something about someone that isn’t true, you might be liable for defamation. The key is whether it’s reasonable to believe that what you’re about to say is true. Stop and ask yourself: Is it reasonable to believe that Bob has blue eyes? Probably. Is it reasonable to believe that Bob has a tail? Probably not. Of course, if what you’re saying is actually true, then it’s not defamation at all. The basic point is this: When you blog, write things that are true.

One quick sidenote here about defamation. When you’re writing about an ordinary person, the standard described above is the one that applies. But when you’re writing about a public figure, like the president, it’s a totally different standard. The question there isn’t whether you reasonably believe the speech to be true, but whether you recklessly disregard its truth. The legal point here is kinda subtle, but the gist is this: When you’re blogging about your neighbors or co-workers, try to say things that are true. When you’re blogging about the president, you have a lot more room to express your opinion, even if it’s not very well informed.

The second kind of lawsuit you should know about it is copyright infringement. Basically, if you copy someone else’s creation — writing, images, sound files, etc. — without their permission, you might be liable for copyright infringement. If you want to reprint something, or you want to put a cute little picture on your website, always get permission first. And of course, good luck to you if you offer pirated MP3s on your website. Essentially, the stuff on your blog needs to be either your own creation, or borrowed from someone else with permission.

There’s a huge exception to infringement called “fair use”, and it basically immunizes your copying of someone else’s work if the purpose of your copying is for education or satire. For example, let’s say you want to copy the South Park theme song to your blog. That’s not a good idea, because it’s copyright infringement unless you have permission. But, let’s say you want to copy it to your website to educate people about it, or to satirize it. That’s probably protected by fair use.

What should I do if someone tells me to take my blog down, or they’ll sue me?

If you’ve been threatened with a lawsuit, by your employer or anyone else, you should talk to a lawyer immediately. If you don’t know a lawyer, email me and I’ll help you find one. Don’t jump into things and take your blog down (or remove a bothersome posting) just because you’ve been threatened. Later on, the fact that you complied with the demand could be used against you. Instead, talk to a lawyer and figure out what to do before taking any action.

Also, threatening someone with a lawsuit is a big deal. In many states, a baseless threat of a lawsuit can constitute harassment. Tread lightly here, but the basic point is that you should stand your ground until you’ve talked to a lawyer and figured out what to do.

Can I go to jail for blogging?

Very unlikely. If you leak classified military plans, or jeopardize national security, obviously, the answer is yes. Also, if you provide instructions on how to do something illegal, like make a bomb, you’re probably not being very safe with your freedom of speech. If your blog teaches people how to do something illegal, you could be looking at a criminal charge.

How do I find out more?Well, the short answer is that you should go find a lawyer and ask a bunch of questions. You can also post a comment or question here, and I’ll do my best to answer it. Or, sit tight and I’ll keep this website updated on the law of blogging as it develops. In the meantime, know your rights, and blog away!