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Clifford Chance mulls scrapping billable hour as performance metric

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Pilot applies to trainee solicitors and up

Clifford Chance is considering scrapping the billable hour as a means of lawyer appraisal and has rolled out a year-long trial to test the new initiative.

The pilot takes place across the global outfit’s Abu Dhabi and Dubai offices and extends to all trainees and associates but excludes partners.

Bonuses paid to reward lawyers’ performance will instead be based on a number of value-add activities including but not limited to professional development, contributions made to the magic circle firm’s knowledge and thought leadership, and time spent progressing its diversity and inclusion, wellbeing and community programmes.

Those participating in the scheme will continue to record their billable hours to ensure the post-pilot data collected is comparable.

Commenting on the new approach, Matthew Layton, global managing partner at Clifford Chance, said:

“To achieve our vision of becoming the global law firm of choice, we need to be prepared to do things differently and to challenge the status quo… With this pilot, we are trying to break the dominance of [the] single metric and allow our teams to think more broadly about where their time is best spent. This may mean investing in time spent developing and applying process improvements to matters, rather than straightforward matter delivery.”

Mo Al-Shukairy, regional managing partner for Clifford Chance in the Middle East, added: “The world we are working in is changing fast. Our people and our clients have different expectations than they had of us in the past. This pilot is an acknowledgement of that change, and an explicit attempt to try to find a new model that is fit for the future.”

The billable hour is widely used as a core metric across the legal profession. It has come under scrutiny in recent years for a number of broadly acknowledged limitations, namely that it does not directly incentivise efficiency nor account for time spent undertaking non-billable work that may be imperative to a firm’s strategy or client service.

Today’s news follows other law firms becoming more creative in their approach to policing solicitors’ hours. Following a successful pilot, Reed Smith rolled out a new scheme last May in which lawyers can allocate up to 50 ‘Innovation Hours’ of their annual billable target to time spent working on innovative projects or products, while some associates in Mishcon de Reya’s London office have had their billable hours slashed by 20% to encourage them to be more innovative.

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8 Comments

Anonymous

DICKSON POON

Anonymous

Pretty token effort when you read the small print.

Anonymous

It may be. But at least they’re trying..to be honest, billing hours are one of the worst features of the profession.
I hope this does not fire back (eg bonus are now purely based on being best buddies with seniors), but the idea is good. Especially now that clients never end up paying by the hour anyway

Baroness Hale of Richmond

Do you reckon Legal Cheek get paid for reminding us Clifford Chance are a Magic Circle firm. Every link says “magic circle form debates/ scrapping billable hours/ supergluing trainees to keyboards/ giving partners free labradors to increase friendly image.” We know who the magic circle are, no need to keep reminding us… sounds like CC are insecure about their place and need to pay LC to remind us just how big and clever they are.

Anonymous

I only see one reference to ‘magic circle’ in the entire article…

Anonymous

I think the person is referring to the link to the article on social media… I guess it’s click bait so you read the article to find out which firm.

Anonymous

Trainees don’t get a bonus at CC, so billable hours targets never play into their remuneration. They also have much lower “targets” in any event, to factor in the need for training, and they aren’t referred to in appraisals anyway.

Jobbie Travers

Or how about hire more employees so that everyone can have fewer billable hours?

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