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The billing department is the lifeline of a law firm, ensuring that the practice effectively bills and collects compensation for services rendered. Its reach extends from the time tracking phase to reporting on key financial metrics. If the billing department proves unsuccessful at fulfilling its duties, the entire firm may suffer fiscal losses, including inadequate cash flow and an inability to manage overhead costs.
Law firm billing departments typically have two major goals in mind. One is to streamline the invoicing process, so that timekeeping administrators can spend more hours on billable client tasks. The other is maximizing billing accuracy to promote timely payments and reduce client disputes.
Unfortunately, three common challenges may get in the way of these goals:
Practice management software can play a significant role in helping law firm billing departments overcome their challenges and meet firm goals. Keep reading to learn how.
Many law firm billing departments rely solely on a limited number of people to manage the entire invoicing process - from time tracking to invoicing and payment collections. If that handful of people becomes overwhelmed or unable to fulfill essential tasks, the entire invoicing process can suffer, creating a financial risk for the firm. This type of narrow setup is also vulnerable to personnel changes. The separation of even one member of the billing department could mean that a vital piece of the billing machine grinds to a halt.
Law firms cannot afford to trust such an important, business-critical process to only a couple of employees without safeguards in place that standardize the processes so that they can be learned and applied by other members of the firm when necessary. Tools like automation and e-billing help law firms create a systematic process that can be understood by managing partners and administrators, as well as easily taught to new members of the billing team.
Practice management software provides law firm billing departments the level of flexibility they need to maximize even the most limited staffing capabilities. It provides mechanisms for simplifying processes, eliminating the need for multiple software services, and systematically managing department tasks. Once firms set their billing processes in place using practice management software, they can ensure that their billing processes will successfully proceed, no matter what changes or limitations may occur within the billing department.
Law firm billing departments take on a variety of responsibilities under the watchful eyes of firm managers, partners, and administrators. After all, every single firm member relies on the billing department to ensure that money earned translates into actual revenue (and payroll). With such high stakes, billing departments need streamlined processes that result in timely and complete collections.
Practice management software assists with this goal in a number of ways:
Another huge benefit of practice management software is the inclusion of trust accounting resources. Trust accounting is one of the most important law firm billing department duties. Inadequate practices can place firms at risk of potential ethical violations, but the right tools help billing teams handle trust accounting accurately and in compliance with jurisdictional requirements.
Legal practice management platforms offer all of these billing and accounting solutions in cloud-based software, which provides a level of remote accessibility that has become absolutely essential within today’s law firm environment. When unexpected business interruptions occur, law firm billing departments need the ability to continue invoicing and collecting payments. Cloud-based practice management makes that happen.
Law firm administrators and partners want detailed billing data that helps them keep a pulse on the fiscal health of the firm. Without this information, they cannot make informed decisions about the firm’s direction. Legal practice management software helps billing departments generate the reports that the partners need.
It only takes a few clicks to generate data-specific matters, practice areas, or the general ledger. Year-over-year reporting provides detailed comparisons between current and past years, while month-over-month reporting offers shorter timeframe reviews.
Practice management software allows law firm billing departments to customize their reporting and generate data sets relating to:
With comprehensive reporting, partners and law firm administrators can gain deep insights into a variety of additional firm details, including average hourly rates, budget compliance, law firm efficiency, and more. The modern e-billing solutions of practice management software give billing departments the ability to extract rich data from invoices and generate detailed reports that would otherwise take an inefficiently unreasonable amount of time.
The expansive responsibilities placed on law firm billing departments necessitate a system that streamlines processes and promotes maximum efficiency. Legal practice management software provides the features that improve processes and drive law firm revenues.
There is a lot involved in the financial management of a law firm. Fortunately, with a good understanding of the principles of law firm finances, firms can reap the benefits of a quality time & billing and financial software system that allows them to handle their firm’s management with ease.
Let’s dive in.
It is common knowledge that improper handling of trust accounts results in the highest cause of bar issues for attorneys. It is imperative that the firm’s trust account be handled by a manager who knows what they are doing and that the managing partner maintains close oversight as well.
Your firm’s legal software should have the ability to track each client’s trust fund balances. By having your time & billing software and your financial software all on one platform, you can maintain accurate records without the need for double entry into two systems. Each month, the firm’s manager should reconcile the firm’s trust account with the bank statement, and following that reconciliation, he or she should run a report showing the trust account balances for each client. The total from the client trust listing report should match the total for the firm’s reconciled bank balance. These reports should then be provided to the managing partner for full transparency.
A common mistake that leads to bar complaints is when a firm transfers funds to the operating account before the client has been billed. Trust funds should remain in the trust account until the client’s regular billing cycle. When funds are transferred to pay an invoice, it is important that the invoice template is clear as to what has been billed and transferred from the client’s funds, and that invoice should be provided to the client so that they have a clear understanding of their trust account’s status.
The firm should not keep more than a small amount of the firm’s funds in the trust account. The sole purpose of keeping firm money in the account is to cover any potential wire fees that may result from an automated clearing house (ACH) coming into the account.
Another common mistake that firms make is transferring funds from the trust account before they have cleared. Gone are the days when a certified check can be treated as cash. Standard protocol is to wait 7-10 days for a deposit to truly clear before drawing on those funds. If the funds are drawn before they are confirmed to be “good,” the firm is essentially using another client’s funds.
It is important that law firms use Engagement Letters (EL) to spell out the agreement between the firm and the client. The EL should define the scope of work, the agreed rates the client will pay for the work, how often the client will be billed, and any interest fees the firm charges for late payments. It should be signed by a partner and countersigned by the client.
Non-representation letters are often overlooked by firms. If a firm discontinues work for a client, or if they provide a consultation to a potential client but do not engage in the work discussed, it is important to send a non-representation letter so that there can be no claim made that the firm was responsible for handling the matter.
Like any business, law firms have a cost of doing business. Do you know what it costs your firm to have an attorney working on a case? You may think it is just a matter of their direct compensation, but there is more to it than that. By using cost accounting methods, you can combine your attorney’s direct compensation and their share of the firm’s overhead and divide it by the number of hours they typically bill annually to know what their break-even rate is. By calculating this rate, you know what you need the attorney’s billable rate to be in order to receive any profit from that attorney’s time. Taking the time to perform this exercise is very valuable to your firm.
Accepting credit card payments from your clients can result in faster payment, improving your law firm's cash flow. It can also result in receiving payments that you may not otherwise receive if you have clients with cash flow issues. It is important to use a credit card processing service that will allow for the separate distribution of your fees to your operating account, in addition to your retainers and settlement payments to your trust account. Law Pay is an example of a service that can assist with legal settlement accounting.
Many businesses charge their customers a fee for using credit cards. It is important for law firms to understand that the ability to follow this practice varies from state to state. You need to consult your state bar to determine whether it is considered ethical in your state to pass on those fees to your clients. You will also want to consider, even if you are allowed to pass on those fees, whether it is good business practice for your firm to do so. Will passing on those fees leave a bitter taste in the mouths of your clients? Are you better off increasing your rates by $5 an hour to cover the cost of accepting credit cards?
Do you know what your billing and financial reports mean? The best way to have accurate reports that you can rely on and to avoid the issue of having to practice double entry recordkeeping between multiple software applications is to use one software that hosts both time & billing and financial data in one platform. For example, by having everything in one place you should be able to accurately and efficiently run reports that show you things like effective billing rates so that you know if after write-downs and write-offs your attorneys are billing at a rate that is higher than their break-even rate so that your firm will see a profit.
The dictionary defines real estate as property comprised of land and/or buildings. Just as that broad definition can include various types of transactions, the practice of real estate law encompasses a variety of different matters. While some real estate attorneys primarily focus on litigation cases, others may spend the majority of their time negotiating land sale contracts. These variations make customizable legal practice management features a must for real estate law firms.
There is a lot to consider when it comes to real estate law, including land use, purchase, rental, and compliance issues. To get a better feel for this expansive practice area, let’s take closer look at some specific real estate practice areas:
These matters center around the sale of single-family homes between individuals or families. Attorneys working in this area tend to focus on assisting home buyers and sellers through the transactional process of buying or selling a home. They may also represent client interests when disputes arise over contracts, titles, financing, permits, or zoning.
These matters focus on the sale, rental, and purchase of commercial properties. They include issues related to contract review and drafting, construction and buildout, land use, easements, and restrictions. Commercial real estate attorneys may also offer advisement about financing issues.
These matters may involve residential or commercial properties. Law firms usually represent the property owner and assist with conflicts over nonpayment of rent, lease term violations, and property use. Property management law firms may routinely appear in court for eviction or nonpayment procedures.
These cases generally involve commercial or small family operations that are primarily used for agricultural needs. Attorneys working in this practice area may provide legal counsel to farmers and other businesses working in production agriculture or other farm operations.
This emerging area of real estate law reaches the residential and commercial sectors. Attorneys may focus on environmental issues related to contaminated land, or environmental restrictions, real estate cleanup, and the protection of buyers and sellers.
A single real estate matter may have numerous components. For this reason, real estate firms may organize their cases into projects, where attorneys and support staff work on teams to handle matters in a more efficient manner. When promoting a collaborative working environment, law firms need practice management features that support communication and help keep everyone on the same page. Here are some of those features:
With workflow automation, law firms can better organize and manage the most complex real estate cases. Workflow refers to the individual steps that go into the completion of a legal matter from beginning to end. When law firms attempt to manage workflows manually, they often end up wasting valuable time and fostering inefficiencies within the practice.
Many practice management platforms include workforce automation solutions. These features help law firms streamline the complexities of real estate matters. From purchase offers to escrow details, automation tools assist with the assembly of relevant documents, the management of closing dates, and the successful completion of real estate matters.
Real estate law firms benefit from workflow automation through the minimization of errors and reduction of risk, data collection and reporting capabilities, and opportunities for continuous workflow improvements.
When law firm team members work in various locations, and at different times, they need the ability to collaborate remotely on documents, contracts, and forms. Cloud-based practice management systems typically offer document management tools that allow members to access and work on documents from virtually any location with unlimited data storage.
Real estate often involves vast and frequent negotiations. Attorneys need to see all matter details in one centralized location so they can create notes, track various versions, and share documents internally or externally, when appropriate.
Quick document search tools save time by making it easy to search databases and documents for specific details. Real estate lawyers can quickly locate a variety of documents, including such items as disclosure agreements, purchase contracts, or inspection certificates.
With the complexities of their matters, real estate law firms must have tools that help them organize, edit, and maintain all relevant documents.
Real estate transactions typically involve numerous deadlines and important dates. There may be mediation appointments, contractual targets, court appearances, or scheduled closings. A comprehensive calendaring system helps real estate law firm administrators keep everyone informed and on track to meet all matter deadlines, from an individual attorney to an entire project team.
Features like automated notifications and secured client portals also help real estate firms keep clients informed about upcoming events and deadlines. These tools allow attorneys to spend more time on profitable tasks while meeting their professional duty to keep clients in the loop.
Real estate law firms may offer their clients any number of payment structures and arrangements. From flat fee options for simple contractual sales to hourly billing options that require client retainers. Firms need legal billing systems that can handle these variations and promote the efficiency of invoicing procedures.
Whether the firm is billing with a flat fee for a simple matter or through a retainer arrangement for more complex cases, real estate law practices need to ability to customize the billing systems quickly and easily in a way that efficiently addresses these billing options. They need a legal practice management system that can manage them all.
Real estate law includes a wide range of specialties, from residential sales to multi-million-dollar commercial transactions. To be consistently successful, real estate law firms need practice management tools that can be tailored to the specific needs of these complex undertakings.
It doesn’t matter who you talk to. Check-in on any firm administrator or managing partner communication platform, and you will find conversations regarding the challenges of finding help. There is a shortage of good talent and the difficulty in recruiting that talent is felt across the board by firms of all sizes and locations.
The reasons for today’s hiring challenges are as varied. However, as the number of firms faced with this roadblock increase, there are some common themes.
There was a significant decrease in law school enrollment from 2010-2015 due to the shortage of law firm job opportunities during that period. Result: if you are looking for a mid-level attorney, you are going to be competing for a very small pool of potential candidates.
With the pandemic, many firms experienced an uncertain future. Firms with practice areas that were impacted by temporary changes in the legal climate saw layoffs and downsizing. With the fear of the unknown, many attorneys are loathe to making any change if they feel their current position is secure, even if they would have been planning to make a change before the pandemic hit.
Gone are the days when a large number of women went into the secretarial and paralegal fields if they wanted to work in a professional office. The legal secretary as a profession is a dying art. The fact that more women are finding other professional fields more available to them is a good thing; unfortunately, the result is a much smaller pool of qualified individuals to fill these administrative positions.
Today’s young professionals expect a positive work-life balance. It isn’t necessarily a bad thing – maybe they are onto something. They also have high expectations from their employer and what the employer will do for them and their career. If firms are to continue to exist into the future, they need to find ways to address these needs and expectations but still be financially viable.
When challenges arise in business, they can be looked upon as an opportunity for improvement and growth. The improvements you can make are endless – below are just a few.
Think of your job posting as a marketing opportunity. It should include more than just the expectations of the candidate – it should also include all or many of the reasons someone should want to work with your firm. (Take your pick from any of the ideas below!) The best places to post your attorney positions are with LinkedIn, your state bar association, area law schools. For administration and staff, you can also use indeed.com, paralegal associations, Facebook.
Good candidates want to work with sharp people. Your process should show your firm has its act together. Communicate with the candidate as to what the process will look like – they will likely meet first with an HR manager. That manager should then let them know what the next steps will look like so that they know what to expect and are not left in the dark wondering what, if anything, will happen next.
Allow firm stakeholders to interview candidates as appropriate. Allowing an associate to meet with a candidate they could be potentially working with does two things. It fosters your internal culture by showing your existing employees that what they think matters. It also shows the candidate that you value your employees enough to allow for this meeting. In addition, a happy employee’s attitude will add to the candidate’s desire to work with your firm. With the influx of Zoom and other video platforms, it is easy to make these meetings happen with little time commitment for either side.
Allowing the candidate to see that your firm cares enough to have core values in place is great. Showing them that you live by those core values through your authenticity and genuine caring throughout the interview process is even better.
Money alone is no longer enough to recruit and retain good employees. In addition to positive core values, think about what other benefits you can share. Some things you might consider:
With the potential hire pool so small, it can be tempting to hire someone who is “good enough” instead of waiting for someone who is a great fit. Bear in mind that if you settle, you will suffer lost productivity among your higher performers as they make up for the lack of performance in an underperformer. In addition, always remember that stellar employees want to work with stellar employees. If you lower your expectations, you stand to lose your high performers to a firm that will give them a high caliber of fellow team members.
One method you may want to consider in your hiring program is to use data analytics to determine what attributes are shared among your firm’s highest performers. You can then make objective hiring decisions based on those attributes.
With the smaller pool of administrative professionals and the challenges firms face with the desire for work-life balance among young attorneys, alternative arrangements can be a win-win. Some alternative arrangements to consider:
Your back office is an area that can benefit from outsourcing. Your firm may not need a highly paid administrator full-time, but you want someone with the experience and skill to oversee your firm to ensure its success. Outsourcing a qualified, experienced administrator can be a great resource for you, allowing you the resources of a highly experienced professional without the full-time salary and benefits that go along with it.
Allowing attorneys to work on a contract basis can be a win-win as well. You pay only for the hours they bill, and they work when they want to work.
Just as it is easier to keep a client than it is to find a new one, it is easier to keep a good employee than it is to find a replacement. In addition, turnover is expensive and extremely time-consuming.
When it comes to your attorneys, consider how your firm’s policies may impact your retention. For example, if your partnership has an origination-based financial system, it may hinder the incentive for senior partners to transition clients to up-and-coming attorneys. As a result, younger attorneys may leave out of frustration. You will lose good attorneys and have no clear succession plan in place to manage client relationships to keep them from leaving when a senior partner retires.
When it comes to non-lawyer employees, consider how they are treated in your firm. If they are made to feel they are second-class citizens because they are not an attorney, you will lose your top-notch professional staff to a firm that shows them the respect they deserve for what they bring to the table. The deep background and experience of your firm managers and staff is invaluable. Also bear in mind that clients will have a higher level of comfort with and loyalty to your firm if they are dealing with the same individuals year over year.
While the lack of potential candidates is a challenge we are all experiencing, there are many actions you can take to make your firm stand out above the rest. By doing so, you will find candidates choosing your firm over the others and staying put for the long haul.
Describing a criminal defense legal practice as busy is a serious understatement. On a daily basis, these firms handle countless criminal matters, many with some pretty high stakes. When dealing with something as serious as a person’s freedom, criminal law firms need systems in place that help them provide stellar legal representation. That includes maintaining client files in an organized manner, staying ahead of critical deadlines, and invoicing with the highest level of efficiency.
This blog will take a dive into the features criminal defense practices need and why they're important.
It is not uncommon for a busy criminal defense practice to simultaneously handle hundreds of criminal matters, all in varying stages of completion. This equates to a calendar full of preliminary hearings, discovery due dates, court appearances, and filing deadlines. Keeping up with a calendar this full can be virtually impossible without the right tools in place. Further complicating matters, even a single missed deadline can have detrimental consequences for the client, as well as the law firm.
Legal practice management software can ease the burden of managing multiple criminal law attorney calendars through the integration of intuitive calendaring tools. Individual attorneys can easily keep track of their own deadlines and appearances, while the criminal law firm administrator can keep an eye on the entire team’s upcoming schedule. Here are some calendaring features that particularly benefit criminal law practices:
The urgency of a criminal law matter often requires a speedy commencement of representation. New clients typically come in feeling as though they have the weight of the world on their shoulders, and they expect immediate assistance. They may need a speedy bail motion filed or they may already have a court appearance scheduled for the following day.
These constant and urgent demands mean that criminal defense law firms need the ability to onboard new clients quickly without the delays that can come from inefficient processes. When it comes to criminal matters, clients don’t have a moment to lose and neither do their attorneys.
With legal practice management software that streamlines the intake process, law firms can quickly get clients onboarded so that the important work of representation can begin. For instance, automated conflict checks can be extremely useful within a busy criminal defense practice. This tool help firms efficiently scan all of their matters for potential conflicts of interest so attorneys quickly know whether they are able to take on a case.
Website intake integration is another useful tool for expediting the intake process. With this resource, firms can collect necessary client data directly from an intake form that was completed through the website. This saves firm members the time of recollecting information that the client has already provided.
Once the intake process is complete, representation can begin. Criminal attorneys can get their clients up to speed on the game plan by providing them with access to everything they need to know. By using a legal practice management system that includes client portal features, firms can quickly make new clients aware of upcoming court dates, discovery needs, and billing details.
As previously stated, criminal clients are often in the midst of extremely stressful situations and they need the assurance of knowing that their attorneys are diligently working on their behalf. The best way to accomplish that goal is through consistent client communications. Criminal defense law firms need tools that help them achieve a client-centered experience.
Client portals are useful tools for providing clients with the information they need. Firm members can quickly upload regular information and clients can independently access their account any time of day or night. This not only promotes client communications, but it also maximizes efficiency. Instead of calling into the firm with their questions, clients can simply log in to get most of the information they commonly need.
Other practice management software features that help with client communications include mobile texting tools and conversation tracking resources that track communications directly into a matter for easy reference when needed. With an automated time capture feature, criminal defense law firms can also easily track time spent on communications to promote accurate billing.
When handling complex criminal matters, law firms often distribute individual tasks among several members of the firm. This type of divide and conquer strategy needs legal practice management software that lends itself to team collaborations with such innovative tools as:
A criminal defense attorney who shows up to court with a disorganized and messy case file is an attorney who loses the confidence of their client. Disheveled case files make it difficult to locate necessary information, especially under the pressure of a crowded courtroom. This is why it is imperative that criminal defense law firms maintain their files in an organized manner and document management tools help get that done.
Document management systems save criminal defense law firms countless hours by streamlining the competitive tasks of document creation and filing, along with searching for relevant information. They also allow firms to share documents with clients and collect documents from clients through a secure platform. Firms that already utilize a document management system like NetDocuments can benefit from a law practice management system that offers complete NetDocuments integration.
Preparing the best criminal defense for clients requires appropriate management and organization of matter files. Document management features help criminal defense law firms digitize volumes upon volumes of documentation for improved workflow, organization, and legal industry compliance.
Law practice management software gives criminal defense firms the tools they need to navigate a case from intake to payment using a centralized hub. Comprehensive case management, combined with integrated billing and accounting tools, keeps law firms on top of their numerous responsibilities. By automating many of the repetitive tasks that come with running a criminal defense practice, law firms can maximize productivity and remove the roadblocks that can hinder them from delivering on their promises of top-notch representation.
Complex client demands and frequent policy changes drive the priorities of an insurance defense law firm, particularly in the areas of administrative and matter processes. Handling these challenges requires comprehensive legal practice management software that offers the features necessary to successfully handle all the pressure points of insurance defense legal practice.
This post will delve into some of those issues and suggest how the right software features can help firm attorneys and administrators effectively address them.
Insurance defense generally involves the representation of various legal matters related to the insurance industry. In more specific terms, these firms are retained by insurance companies to represent their insured clients who face lawsuits related to their insurance contracts. For instance, an insured restaurant owner is sued by a customer who allegedly slipped and fell inside of the restaurant. The insurance company hires the law firm to represent the restaurant owner.
While this may seem like a pretty straightforward legal arrangement, it can quickly become complicated because of the three-sided relationship that exists. Unlike other practice areas where attorneys typically further the interests of one easily identifiable client, insurance defense attorneys are forced to balance their responsibilities to the insured with their responsibilities to the insurance company.
This situation begs the question, “Who is the client?” The insurance company pays the legal fees for representation, but the firm has a professional responsibility to the insured. Oftentimes, the interests of the insurance company differ from the interests of the policyholder, leaving the law firm in the middle of the conflict. Faced with these unique challenges, in addition to standard administrative and client tasks, insurance defense law firms need specialized tools that will help them manage complex matters while maximizing productivity and promoting profitability.
Billing poses a challenge to insurance defense practices due to the variety of specific guidelines and restrictions that insurance companies may place on invoicing processes. For example, insurance defense law firms may be forced to contend with restricted billing rates or fixed fee billing arrangement requirements. These types of constraints make efficient billing processes extremely important.
When working with numerous insurance companies, an insurance defense firm may need to navigate numerous billing arrangements. One insurance client may require the firm to work under a fixed fee arrangement, while another may allow for traditional hourly billing. These variations require a legal billing platform where firms can easily invoice for a variety of arrangements by customizing billing options for each individual matter.
Insurance companies often require law firms to use Legal Electronic Data Exchange Standard (LEDES) invoicing codes, which can be a difficult task without the right legal billing software in place. This type of billing is primarily used to promote uniformity within the legal industry and assist insurance companies in their processing of law firm invoices. Insurance defense law firms need systems that offer the ability to easily generate LEDES invoices in .dat or .txt file formats for proper online submission. They should also have UTBMS codes already in place and LEDES formatted templates for faster invoicing.
It is not unusual for a single insurance defense matter to include volumes of documents. From medical records and witness statements to policy documents and insurance company communications, these case files can be quite extensive. This is why insurance defense firms need document management software that helps them easily store and organize all matter-related files and documents in one central location.
With the right software, credentialed users can efficiently view, edit, and share documents as needed. This makes collaboration internally within the firm, as well as externally with the insurance company, much easier to accomplish. Some other useful document management tools include:
Using a legal practice management software that integrates with a cloud-based document management system, like NetDocuments, allows insurance defense law firms to organize, secure, and find all of the documents they need right from the practice management platform.
The intricacies of insurance defense law require a superior matter management system that tracks every aspect of these complex cases. When choosing a legal practice management system, law firm administrators need to look for features that address the specific needs of their practice area, such as:
Under some circumstances, insurance companies may call in a third-party auditing firm to conduct an audit of a particular matter. Having an organized case management system saves the extra time and resources that would otherwise go into preparing for the audit. It also presents every aspect of the matter, from intake to final billing, in an organized and structured manner, increasing the likelihood of a successful audit.
This goes back to the most complex aspect of insurance defense law. Competing interests between the insurance company and the insured can bring up ethical uncertainties for the firm and its attorneys. The appropriate strategy for handling these sticky situations largely depends on state rules. For instance, the North Carolina State Bar deems the insured as the "primary" client in an insurance defense case, whose "best interest must be served at all times." According to the Bar, the attorney owes the insured a heightened duty of communication and loyalty at the least.
To best serve their clients and protect themselves from potential allegations of wrongdoing, law firms need a foolproof method of managing, storing, and organizing all client communications. Tools like in-app text messaging, client portals, and conversation tracking help law firms securely maintain and manage client communications directly within the matter for future reference at any needed time.
Intuitive email management is another tool for elevating client management. With email integration options, firms can save client emails to matters in a matter of seconds. Advanced email search tools help firm members quickly locate emails using properties like subject, sent/received date, or email content without the hassle of manually searching through a crowded inbox. Billing is also made easier with an email management feature that automatically creates billing entries for sending or reviewing client emails.
If you're an insurance defense firm or you're looking to expand into the practice area, the goal of your operations should surround agility and organization. Specialized tools will help you manage complex matters while maximizing productivity and promoting profitability.
For more than a year now, the practice of law has looked vastly different than any other time in history. From Washington DC to Arizona, courthouses were shut down to the public and attorneys for common proceedings, greatly affecting the traditional law firm environment.
For some firm leaders, less time in the courtroom resulted in more time spent on administrative tasks, especially in situations where downsizing needs impacted support staff numbers. Attorneys found it necessary to take on a larger percentage of law office management duties.
With the world starting a slow return to normal, court systems nationwide are beginning to open up, welcoming attorneys and the public back into courthouses for in-person appearances and other court-related business. While some jurisdictions remain at partial or limited capacity, others have made the transformation to 100%, forcing many attorneys to make a quick transition.
For attorneys handling more of their firm’s administrative duties, returning to the courtroom can feel stressful. They may worry about balancing an increased workload and more time away from the office with their increased administrative duties. But legal practice management software offers these attorneys the help they need to provide clients with quality legal service while also handling law office administrative needs. With tools like automation and legal billing, attorneys can stop worrying about their long list of administrative tasks and focus on a successful return to the courtroom.
Here are some specific ways that legal practice management eases the transition back to the courtroom:
Many law practice management software options contain accounting features, but not all platforms are the same. Law firms should have accounting tools that can manage both general firm finances and client billing tasks. General firm accounting needs help law firms with:
These tasks are typical to most accounting software and don’t necessarily require an accounting system specific to the legal industry. However, attorneys returning to the courthouse need maximum efficiency and a software that goes beyond the accounting basics to handle client invoicing.
Invoicing takes up a significant amount of valuable time when not handled efficiently. It can also lead to troublesome inaccuracies. Maximum law firm efficiency requires legal practice management accounting that saves valuable time during the invoicing process and promotes billing accuracy. Other useful legal accounting features include real-time financial insights that provide law firms with data about the firm’s financial wellbeing and vendor tools that help automate third-party vendor payments.
Trust/IOLTA accounting is another extremely important law firm duty. Firms need a legal practice management system that streamlines the various trust accounting processes and promotes compliance with state regulations. Accurate trust accounting requires the ability to keep record of client funds held in trust and accurately track all deductions from these accounts, including payments automatically applied to bill balances.
Some necessary duties specific to trust/IOLTA accounting include:
A return to in-person court hearings makes accurate calendaring an absolute necessity. Some attorneys have been attending virtual court hearings for more than a year. Making the transition back to physical appearances requires some challenging adjustments.
A firm-wide calendar helps keep all firm members in sync and on the same page, even those working remotely or temporarily away from the physical office. Personal viewing options allow individual firm members to view the day ahead with a single glance. Lawyers need a legal practice management software that offers a variety of calendaring features, such as:
Legal practice management software makes it easy for law firms to track all things related to each firm matter. Real-time dashboards provide accurate updates pertaining to trust balances, billed fees, billed expenses, and outstanding accounts receivable. Spending reports and email alerts help keep matters within established budgetary limits. Firm leaders can also review work completed on a case by various categories, including specific timekeepers, fees, or expenses.
With some legal practice management software options, law firms can work within the system to build out a matter. The system can then automate the case by assigning tasks or even completing some tasks. This adds up to valuable time savings for the entire firm, and especially attorneys returning to the courtroom. Legal practice management workflow systems can also keep law firm teams updated, as well as clients. Firms can set automated emails to be sent to clients as their matters reach specific milestones.
Moving away from the office and back into the courtroom means that firm attorneys routinely need remote access to documents. Law firm management software can maintain firm documents in a safe and secure environment while also allowing for easy sharing with credentialed parties. Firms can organize documents by matter and save administrative time by creating standard folders to be generated for every new matter.
There are also document management options that allow clients to securely upload documents to the firm, which clients appreciate because it saves them time and effort as well. The legal practice management system notifies the appropriate firm members when clients upload documents, as well as when they download documents shared with them.
Other useful document management features include:
Navigating the legal landscape since the start of the pandemic has not been for the faint of heart. From work from home to Zoom, and virtual courtrooms, firms are having to quickly learn to balance a different kind of workload.
The functionality and purpose of legal practice management software are to offer attorneys and their firms a means to provide their clients with the quality of service they expect while also juggling the back office, behind the scenes needs in whatever environment they may be faced with. As we begin to focus on a successful return to the courtroom, you can rest easy knowing that no matter where you are, you will be able to get your job done and keep your clients happy.
The cloud has become a standard part of our lives. From streaming video platforms to smartphones and smart home devices, we rely on cloud computing to make our days exponentially more convenient. But individuals are not the only benefactors of cloud computing. Over the last 10 years, business leaders around the world have incorporated cloud-based technologies, recognizing their greater efficiency and cost savings potential. Though it has taken a little longer, the legal industry has also started embracing the cloud.
As reported by the American Bar Association’s 2018 Legal Technology Survey Report, less than 55% of all surveyed law firms utilized some aspect of cloud computing. The hesitation among law firms typically stems from three main reasons: worries about security, limited understanding about how the cloud operates, and ties to traditional methods of practice management. Many of these law firms still rely on filing cabinets and in-office servers, but the disruption of service that took place over the last couple of years made the drawbacks of this decision painfully clear.
Legal practice management software helps law firms keep all aspects of their practice organized and running efficiently. Firms have been using them for years to handle such needs as document storage, contact management, calendaring, and task management. They become the backbone of a practice, and when they are not available – whether due to a server crash or office inaccessibility - firms can experience debilitating process failures. After all, practice management software is only beneficial if a law firm can actually use it.
With in-office options, the practice management software is installed on a local computer or server located within the physical office space. Those servers are usually only accessible from computers also located within the same space, which limits the capabilities of the practice management software.
Cloud-based legal practice management software is not installed locally on your office server. Instead, it is web-based, using a remote server maintained by the software provider. Access occurs through the internet, which makes the software convenient and virtually 100% available for use.
If you are a law firm leader or administrator who is frustrated with the inconvenience of premise-based software, this post is for you. It will explore 4 reasons why your law firm needs cloud-based legal practice management.
With cloud-based legal practice management software, law firms can access all of their data at any time and on any device. This includes everything from documents and emails to time tracking tools and invoices. It eliminates the need to be located within the physical office because all data is stored in the cloud, which can be accessed remotely with the right credentials.
Even when a firm member makes changes to a client file or administrative document, other firm members maintain access to the most recent version. Working with a cloud-based legal practice management software gives attorneys and legal support staff the ability to retrieve case data and work on matters in a secure environment without the need for those antiquated network connections that confine them to the four walls of the office. Remote work becomes easier, with greater efficiency, productivity, and accountability.
Law firms need an IT infrastructure that they can consistently rely on to meet their practice management needs. Recurring problems and excessive downtime limit productivity. They can also threaten a firm’s ability to maintain confidential client data in an adequately secure environment.
In-office servers are notorious for their unreliability. They break down often, especially without regular maintenance and updates. They are also known to be extremely glitchy which frustrates firm members as they try to complete time-sensitive tasks.
Firm administrators that choose an on-premise legal practice management software must prepare for continuous maintenance needs and repairs. Many firms find these tasks so challenging that they either keep an IT expert on staff to address server problems, or they contract with an outside IT consultant. Yet, even with the most proactive measures in place, servers can still go down, leaving firm members unable to use them.
Cloud-based practice management platforms obviate all of these headaches. There is no requirement to manage expensive servers because the software provider automatically performs all necessary updates, regular maintenance, and backups. They also quickly address any repair needs, often before firm members even recognize that a problem occurred. Every technical task related to cloud-based practice management software is supported by one centralized team solely dedicated to its performance.
Changes within a law firm require a practice management system that is flexible and quick to adapt. Whether you are the administrator of a mid-sized firm that is scaling up or you are downsizing your firm’s physical office space, cloud-based legal practice management software adjusts with the changing landscape of your law firm.
Cloud-based practice management software offers a variety of modules and features, and many providers allow administrators to choose which options best meet the needs of the firm. This means that as the firm grows, so can its practice management software. There is no need to start from scratch with a new system when you can easily make adjustments to what already works.
It’s no secret that office relocation can be a pain in the neck. But it’s even more challenging with an on-premise server. Moving the server from one location to the next will likely require the assistance of an IT technician. It can also result in a period of inaccessibility to important firm and client data.
With a cloud-based system, your firm’s practice management software remains intact and ready to access throughout the entire move. Unlimited storage capabilities alleviate the need for heavy file cabinets and multiple servers. With everything stored in the cloud, firm members can settle into their new digs and get right to work without costly interruption.
Many lawyers still doubt that cloud technologies can offer the level of security that they are ethically obligated to provide their clients. Yet, the real dangers of theft and security breaches are much more prevalent with in-office systems. A single fire or natural disaster can decimate physical documents in a matter of seconds. In addition, the responsibility to protect an on-premise server from cyberattacks falls on the firm, and that can prove very expensive. Cyber experts and server updates cost money, but law firms must take on these costs to keep their physical servers secure.
When using cloud-based legal practice management, data is continuously saved and stored within the cloud, protecting it from physical threats like fire or natural disasters. Law firm leaders also control which members of the firm have access to the software. Some systems even offer security measures that limit the accessibility of induvial cases or firm records.
Cloud providers maintain a team of security experts who are on constant guard against cyber threats and attacks. They take on this expensive responsibility so that law firm administrators feel comfortable trusting them with their law firm data.
Law firm administrators that understand the power of cloud-based legal project management provide their firms with a valuable resource that streamlines and protects numerous aspects of legal practice. When choosing the right cloud-based option, look for features like:
As your law firm evolves, cloud-based legal practice management software can provide the continuous support and stability that your firm needs.
Any human resource (HR), firm administrator, or back-office professional working within a law firm environment can affirm that firm culture creates its own set of distinct challenges. Regulatory guidelines and industry standards require considerations not often seen within other business industries. While most big law firms maintain an HR department to address these complexities, HR issues often wind up on a law firm administrator’s long list of duties.
This blog will take a look at eight unique HR challenges commonly experienced by law firm administrators.
Law firms constantly compete with one another to attract new talent. With such a high level of competition, firms need financial incentives, like aggressive compensation packages and new hire bonuses, to stand out from the crowd. While administrators typically don’t make compensation decisions, they do have significant influence to craft a workplace culture that attracts new talent. Legal professionals want to work in an environment where they feel heard and appreciated. By implementing policies that address this desire, law firm administrators can help their firms attract quality new hires.
In recent years, younger law school graduates have also voiced a preference to work with firms that have taken public stances on social issues and actively support initiatives that they find important. These candidates want to feel good about where they choose to work, and some of them are even willing to forgo larger salaries to meet this philosophical need.
Recognizing this growing trend, administrators can take steps to highlight their firm’s philanthropic efforts during the recruitment stage. Whether it's pro bono representation or direct financial contributions, charitable information should be highlighted when recruiting.
Over the past year, the lack of diversity within law offices has garnered a lot of attention, with increasing criticism about the industry’s lack of racial, ethnic, and gender inclusion. Traditional recruitment efforts to find and secure new associates often create applicant pools that are far from diverse, so this is where firm administrators should start when seeking to address the issue.
For instance, administrators can suggest that firms expand their recruitment efforts to Historically Black Colleges and Universities (HBCUs) and job fairs that focus on promoting diversity. By casting a wider net, firms can better position themselves for the consideration of a more diverse candidate pool.
Administrators can also take steps to revamp their firm’s recruiting processes and minimize bias. Tools like blind recruiting and diverse hiring committees promote diversity and help law firms meet their goals.
In addition to finding the best diverse talent, law firms also need strategies to keep them. Sustained law firm diversity requires an environment where all attorneys feel welcomed and valued. Firm administrators can promote this culture with policies such as:
Getting talent into the firm only represents half of the challenge. Competition among law firms not only exists at the first-year associate level, but also drives lateral hires. Traditionally, law firms have been seen as long-term commitments, with associates working for years to reach the partner track. But increasing numbers of law firm attorneys are choosing lateral movement to a different law firm over tradition.
For law firm administrators, this means crafting strategies to keep firm attorneys happy and satisfied in their current positions. Here are some suggestions:
Legal tech innovations are constantly improving law office management and the practice of law. From legal practice management and document production to legal research and court document filing, advancements in technology have swept through the legal industry.
Unfortunately, many law firm administrators find it difficult to implement these new technologies due to resistance from firm members. Some senior attorneys may not want to change their current methods of getting tasks done. They may fail to recognize any value in implementing new technologies.
Addressing this resistance can be done through HR policies that require a certain number of tech training hours each month. Administrators can also consider peer training programs between more advanced and less advanced firm members. Law firms have a duty to stay abreast of standard legal industry technologies and firm administrators must stress this duty as an HR responsibility.
The practice of law is notoriously stressful. On a daily basis, attorneys work under tight deadlines to produce results that are free from error, beneficial to their clients and sometimes even life-changing. While attorneys stress about their outcomes, staff members stress over hovering attorneys and their long list of tasks.
Together, all of this creates an extremely stressful environment, where late hours and poor work-life balance become the norm. This leads to depression and anxiety, which are widespread problems among attorneys. Mental health issues cost law firms substantial amounts of money, so it is in the firm’s interest to address these concerns.
While administrators cannot do much about court timelines and demanding clients, they can implement policies that seek to address the amount of stress experienced by law firm members. Administrators should consider policies such as:
Praising attorneys for working early and staying late only exacerbates an already stressful situation. An unhealthy work environment can diminish productivity and leave attorneys feeling burnt out.
Attorneys have a requirement to earn a certain number of continuing legal education credits each year. In most business environments, HR takes on the responsibility of tracking employee education efforts. However, within a law firm, CLE also comes along with reporting requirements. Particularly within a large firm, this can quickly become an all-consuming task. For this reason, many firms choose to have a dedicated staff member to track and report CLE efforts. This individual may fall under the supervision of HR or the firm administrator.
In addition to CLE requirements, continuous education may also include such things as professional development training for improved client contact, marketing techniques for improved rainmaking, and courtroom demeanor presentation skills. Law firm administrators may also implement training for legal support staff in the form of court filing rule updates and technology training.
The reporting structure of a law firm can be extremely convoluted and tricky to maneuver. The lines of supervision often overlap, creating an environment ripe for potential conflicts. For example, attorneys supervise the work of their support staff. However, those staff members report to HR for personnel needs. With this dynamic in place, a simple vacation request can become a big problem. While HR may approve the request, the supervising attorney may reject it due to a pressing case deadline.
Another unique characteristic of law firm hierarchy is the status system that commonly exists. Founding partners, shareholders, and top rainmakers often make up the leadership level of the firm. Non-equity partners fall a little below them, followed by attorneys, then legal support staff, and administrative support staff – in that respective order.
Under circumstances like these, it can be hard to identify where the HR department fits in and what power they have to effectively carry out their duties free from interruption. This creates a situation where law firm administrators routinely walk a fine line between HR and firm management.
Outsourcing has become a common practice within the legal community as law firms look for ways to offer a high quality of service while cutting costs. For instance, when a big case walks through the door, law firm leaders and administrators may find it more efficient to bring on contract attorneys and paralegals rather than pulling their existing staff from other client matters.
While outsourcing can promote profitability for the firm, it can present some challenges on the HR side. Firm administrators must ensure that contract workers remain in compliance with confidentiality and qualification. Even as temporary staff, these legal professionals must meet all professional requirements.
Law firm HR duties often spill over into management and administration. As such, law firm administrators need to consider HR challenges and be prepared to address them as needed.
Law firms today are finding it increasingly necessary to meet specific client needs with their invoices. If your firm is to receive payments from clients in a timely manner, it is important that your invoices communicate the information expected by each client in the format that they require. With the right software and planning on the front end, this does not have to be an onerous task.
To begin, there are some criteria that should be included on every invoice, regardless of the invoice format or template. You want to ensure your invoices provide:
Research shows that time not kept concurrently results in as much as 30% of billable time lost. By using a system that provides a timer and ease of use for time entry, attorneys can easily track their own time in the billing system as they are working, ensuring both efficiency and accuracy of your billed time. With user-friendly software, it is no longer necessary for attorneys to handwrite their time entries, with a staff person paid to take the time to enter those tasks into your billing system.
Not to mention, attorneys can utilize technology that will allow them to automatically capture time throughout their day without missing a beat. Whether they're texting a client about an upcoming meeting, sending documents over email, or answering a call after hours, every second is automatically captured and converted into a time entry.
By using software that allows the use of multiple billing templates, your firm can create templates to meet each individual client’s needs. While some clients will pay your invoices regardless of the format (as long as the information is communicated clearly), if you have corporate clients or represent insurance companies, you will find you have many that have specific requirements. By assigning the appropriate billing template to each matter on setup, you can ensure that each client is automatically receiving their invoice in the format they require.
Additionally, make it easy for your clients to pay you directly from their bill. Think about all the bills your clients pay on a monthly basis... from utilities to internet and wifi, cellphone, the list goes on and on. And then when you think about how people are paying these bills, you'll come to find that a majority of them are being processed online electronically. So meet your clients where they already are and offer credit card payments of eChecks. Some of your clients may prefer snail mail and that's okay, but the world is trending digitally, so it is becoming best practice to offer both payment methods.
Do you have clients who have billing requests beyond the formatting of their invoices? For example, if you typically email invoices but you have some clients who require their invoice to be mailed, how does your billing staff remember this each month? By setting up pre-bill notes in your matters and using a pre-bill template that will show those notes, when your billing staff is ready to run the final invoice, they will have that information directly in front of them.
Other information that may be included in pre-bill notes is whether there is a special agreement for the matter – is it a flat fee, a contingency matter, or does it have a fee cap? How about a budget? By including all of this information in a way that it will show on the pre-bill, you will save your staff time (and therefore the firm money) while also ensuring that special agreements with clients are not missed.
You can meet your client needs while also working smarter, not harder, by having specific templates assigned to each matter and tracking time in the billing system concurrently. Invoices can then be generated efficiently and painlessly at the end of each billing cycle, improving your law firm's cash flow and resulting in prompt payment from happy clients.
