Sep

24

Hourly Rates

September 24, 2009 | Leave a Comment

The fact that hourly rates for Partners have in the case of the ‘magic circle’ decreased by one-third is an entirely pragmatic reaction to current and recent market conditions with clients demanding greater value for money and where possible insisting on fixed fees.

In comparison hourly rates for Associates have remained comparatively static with newly-qualified averaging £250 per hour and Associates with 5 years PQE around £375 per hour in the ‘magic circle’ and £250 outside.

Given this dynamic, the continued emergence of alternative billing methods in particular fixed fees and the increasing pressure on bottom line profitability at the firms there will necessarily be an effect on the way in which firms staff their transactions. Furthermore the law firm leverage pyramid is a product of the hourly rate and so if this trend continues it may even possibly effect they way in which they structure themselves in the future. The need to maintain profitability whilst keeping overheads to a minimum is critical to any given firm’s future well-being and has led many of them to investigate staffing alternatives such as ItsMyLaw. 


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