The Hours Follow-Up: If you’re looking at less than 1600 in 2009, you’re not alone.
Many of our Biglaw friends have been biting their nails over hours this year. Lawyers are not worried about making bonuses at the end of the year. They’re worried about keeping their jobs. Last week, we invited you to share your hours’ outlook for 2009 and to see how you compare with fellow anonymous ATL readers.
One astute commenter pointed out:
Has it dawned on anyone that people billing solid hours aren’t taking the time to take ATL surveys?This survey will be less reliable than my balls.
We’re not sure how reliable that reader’s balls are, but the poll results might shrivel them. The percentage of those looking at less than 1600 hours for the year is staggering. Check out the results after the jump.
In the first few hours of the poll being up, a good chunk of voters — over 21% — said their hours were going to be fewer than 1600 for the year. Not surprisingly, those billing less that 1600 are our quickest voters (and likely, our most frequent ATL visitors). Over the next week, over 5,000 people voted. The percentage billing less than 1600 hours fell but not by much:
| 2009 Hours Prediction | Percentage or Survey Respondents |
| Less than 1600 | 19.4% |
| 1600 to 1699 | 7.9% |
| 1700 to 1799 | 8% |
| 1800 to 1899 | 11.4% |
| 1900 to 1999 | 12.6% |
| 2000 or 2099 | 13.8% |
| 2100 to 2199 | 9.6% |
| 2200 to 2299 | 5.2% |
| 2300 to 2399 | 4.1% |
| More than 2400 | 8% |
See the results with pretty colors here.
The biggest percentage of billers are those coming in under 1600. Those billing between 2000 and 2100 hours came in second with over 13% of voters. The over-2400-hour heavy hitters made up 8% of those surveyed, or 420 people.
How does that compare to last year? Here are Justin Bernold’s results from 2007 and 2008 surveys. We’re including what respondents predicted midway through 2008 to give you a sense of how reliable 2009 predictions might be:
Results: How many hours did you bill in 2007 and 2008?
| Billable Hours | 2007 | 2008 (predicted) | 2008 (actual) | 2008 (actual client billable) |
| Less than 1600 | 3.29% | 7.93% | 14.32% | 16.65% |
| 1600 - 1699 | 2.58% | 6% | 5.75% | 5.55% |
| 1700 - 1799 | 3.99% | 5.61% | 7.36% | 8.87% |
| 1800 - 1899 | 8.45% | 7.54% | 9.37% | 11.39% |
| 1900 - 1999 | 11.5% | 16.44% | 13.6% | 15.21% |
| 2000 - 2100 | 22.54% | 21.08% | 18.11% | 15.79% |
| 2100 - 2199 | 12.68% | 14.31% | 11.11% | 9.52% |
| 2200 - 2299 | 11.03% | 6.77% | 7.98% | 5.77% |
| 2300 - 2399 | 12.44% | 5.42% | 4.64% | 4.33% |
| 2400+ | 11.5% | 8.9% | 7.76% | 6.92% |
Looks like 1600 minus billers are trending up and 2400 plus billers are trending down. We think our next survey might need 1400 and 1500 hour categories.
Earlier: The Hours: How are yours looking for 2009?
Associate Life Survey: What Did You Really Bill?
(39) 
Comments
The State of Texas Lathamed an innocent man!
What a great survey to help justify further layoffs!
-Anonymous Firing Partner
Kash talked about some guys balls.
Lucky guy.
Fust!
How many of the participants were unemployed lawyers who clicked on under 1600? I'll admit to being one of them.
Does anyone know if Latham NY laid off any first-years? How did that affect the personal and professional lives of the affected associates? I've been searching high and low for this information, but it's nowhere to be found.
I don't think that this is accurate. Even the corporate people in my office will easily be clearing 1600.
Sweet! I'm not alone. It's Chrometa time now since time is due tomorrow night. I hope I can find some extra hours I forgot about. Be back in 20.
My balls are extremely reliable. Everytime I look, they are still there. Completely the opposite of the biglaw job situation.
3--I thought the same thing!
6 - Latham NY only laid off one first year, a guy who failed the bar. I think he was the cousin of one of the partners, though, so it was a bit of a scandal.
6, the Latham layoff rumors resurface every year at OCI time. These lies are disseminated by Cleary and Skadden to steal recruits away from a superior firm.
Highly scientific survey....
Everyone remaining at Cadwalader will easily clear 2000 hours.
The funny thing is that 1600 hours at $250/hr = $400k. Even at a pay rate of $200k per year law firms are still doing quite well. And $250/hr is a low estimate.
15 -- you are truly an idiot
I wish I could bill hours again. I spent much of this morning in a station platform on the 5 Line billing minutes from passersby with future predictios and free legal advice. For 55 cents, I sold my theory of how the Third Amendment makes municipalities liable for SWAT raids on the homes of African-Americans, to one curious Biglaw attorney who I could tell is a reader of ATL (when he pased, he said, "Elie Mystal??"). He laughed as he gave me the chage, but I could tell he was imp[ressed that I still have it.
Future tip: Stay out of Los Angeles in the Summer of 2013. At all costs.
15, what kind of firm are you talking about? I was being billed out at $500 per hour when I was at a bigaw firm last year. Now that I'm on my own, I bill $250 as a solo. $250 is not only a low estimate, it's not even close. I'd guess that the average billing rate at a biglaw firm for associates is about $375-400 (that's a weighted average guess of all classes of associates).
It's way past time for law firms to fire any associate who isn't billing at least 1900 a years. It doesn't matter is there isn't enough work. If there's no work, then fire the shitheads. You can always hire more down the road. Associates are like ants. Step on them whenever you like, but there are thousands more waiting to pick up the scraps.
Am I the only one that thinks it very sad that this guy believes his balls are unreliable?
According to these numbers, there will be a red sea of layoffs come first quarter 2010.
400k off of 1600 hours assumes a 100% collection rate from the clients, no discounted time, and no written off time, which isn't likely.
PE - yes, from DecherTTT and Morgan
Latham is poorly managed. I wonder if Dave Gordon is mentally retarded.
Okay, so I low-balled the billable hours, didn't take into account the fact that some clients may not pay, and didn't write off any time. And am apparently truly an idiot. But my original point that law firms (or I guess partners) are still making a crapload of money if their associates bill 1600 hours still makes sense. I'd like to hear a breakdown (especially from 16) of how that doesn't work.
In a moment of honesty, a partner told me that the firm makes money on associates all the way down to approximately 1200 hours.
26 - that is obvious from the math. At ~ $375/hr, for 1200 collected hours, the firm has $450k in revenue. Back out comp and allocable overhead, and the associate is probably break even. At 1800 collected hours, revenue is $675k, probably $250k of which is profit.
27 - with those numbers, let's assume the associate's salary is $200k. I don't think allocable overhead is anywhere near $250k, so it's likely that even at 1200 hours the firm is making money.
Many lawyers may also be counting pro bono, as many firms technically count that toward billable requirements. Which counts against the downward bias from non-busy associates taking the poll.
25,
the answer is that it probably varies significantly from firm to firm based on overhead and realization rates.
The sort of traditional rule on expenses is that 1/3'd goes to materials, 1/3d goes to labor costs, and 1/3d goes to overhead and profits.
That doesn't translate terribly well to law firms, but the idea is that generally an associate is probably going to have to bill 2-3 times his salary to make a solid profit for the firm.
Then there's realizing your bills. Even for firms with corporate clients, it's pretty common that a bill will go unpaid. If you're involved in bet the company litigation and the company gets hit with a killing size judgment and is going to fold, you better hope you've been collecting your bills as they accrued. Not to mention corporate counsel's primary job in a lot of cases is to manage outside counsel and that includes going over those hours with razor, and working out discounted rates. Sure the firm might set it's "rate" for associates at $450, but for that big client it might well be $300.
I know suggesting an improvement to an ATL poll methodology is like dusting the banisters on the Titanic as it goes down, but....
PLEASE, AT LEAST PUT A "IM A LAW STUDENT/SEE RESULTS" OPTION.
THOUSANDS OF LAW STUDENTS CLICKING RESPONSES MESSES IT ALL UP.
The fallacy in all these your-still-making-money arguments is that by firing the <1,600 hour att'y, every future hour s/he would have billed will still be billed by those remaining and so the entire cut salary is pure "profit." Simply put, it's not whether you're earning your keep, it's whether the firm can maintain the same number of billables with less overhead (i.e., attorneys). Breathtakingly simple.
26-- you are a liar, and a stupid one at that. My guess is you are a law student that has never worked as a lawyer a day in your life.
29 - Good point on the pro bono hours. One of my friends just spent 6 months billing only pro bono and it's obvious the firm was losing a ton of money on him. But the answer to that is that if law firms can't afford it, don't do pro bono. They're still making a ton of money, they just choose to spend it on free legal services.
30 - I can't imagine that overhead/materials rank anwhere near the labor cost of one attorney. Well, actually I can, seeing the horrible business decisions many law firms have recently made (6 months severance? WTF?). But even by your numbers, at 1600 hours it's pretty close. It appears from the totally unscientific poll that most lawyers are billing much more than just 1600. As a law grad I'm unable to do the required math, but it still looks like law firms are doing quite well.
32- fallacy was not the word you were looking for. The fact that law firms could be making more money by firing some workers and making the rest of the workers pick up the hours wasn't even close to the point. But you obviously knew that already, because it was breathtakingly simple.
33 - ditto. 26.
31 and your ilk -
Wake up. There was an option to see results at the bottom of the poll page. Funny, I had no trouble finding it.
I am a corporate attorney billing at $360 per hour and will hit about 1650 hours this year. Even at 92% realization, I will be more profitable than most of my litigation brethren who will bill 2000 hours. And it won't be close.
The billable hour is dead. Cash is king.
You all need to stop kidding yourselves....majority of all associates will bill below 1600, several will not even clear 1000