Wednesday, January 14, 2009

A recent email exchange about billable hours for lawyers

Hi Drew. Glad to hear you are enjoying the book. Your questions are good ones, but ones that I cannot fully answer. I'll do my best - see below.

2009/1/12 Drew

Dear Adam,

I'm in the process of reading your book now and I'm finding it very informative. I'm in the second year of my undergrad yet I've wanted to go to law school ever since a mock trial experience in grade 5. I've read enough John Grisham to know about how consuming billable hours can be yet, one thing is unclear to me.

It is true that billable hours can be overwhelming. Firms in Alberta can expect anywhere from 1000 to 2500 billable hours from their associates each year. Depending on the type of law, and the efficiency of the lawyer, this can equate to 1400 to 5000 actual work hours, or 28 to 100 hours per week of working. I know many lawyers who work 80 to 100 hours per week. That's equivalent to 12+ hours per day. It doesn't need to be like this, and I have many lawyer friends (including myself) that have more reasonable 35-45 hour work weeks.

Do lawyers earn overtime? If you work more than 8 hours a day aren't you obliged to earn overtime at an increased hourly rate under labour law?

No, usually they do not (perhaps if you work for the Alberta or Canadian governments). Different law firms treat things differently. Most are salaried. There is no overtime for salaried employees of any type. You get paid X dollars per year to do the job, and that's it. Many firms also pay bonuses based upon performance. I.e. if you hit your billable goals, or receipt goals. Many firms have now moved to a commission program, where the lawyer gets around 40% of any receipts that they bring in. This provides great incentive for many lawyers. For sole practitioners, and partnerships, you get paid any profit after expenses, so the harder and more efficiently you work, the more money you make.

Finally, is there a website where I could see trends in the annual salaries of lawyers? Not just for 1st year associates but for 3rd 4th and 6th year associates? I like the description of the appeal that a small town practice can offer in your book. However, I wonder what kind of salaries do more experienced lawyers in these settings bring in?

Not that I am aware of, at least not for Canada, but check on places such as lawstudents.ca or lawbuzz.ca. Perhaps somebody has posted some info there.

As in any profession, there is a wide range of salaries for lawyers. There are poverty lawyers who get paid very little, and some lawyers (such as Tony Merchant of Merchant Law Group) who make millions and millions. I find that many 1-5 year big firm lawyers in Calgary or Edmonton, Toronto, or places like that, make anywhere between $70K and $200K, depending on their situation. Now, taking into account the number of hours they work, this can seem like a good salary, or not such a good salary.

The same applies to small town or small city lawyers. I make, probably, as much as the big city lawyers, but I work far less, and really enjoy my work. That's not the same for everyone. I have our main office in a city of about 70,000, and a branch office in a town of about 3,500. It works for me...

If you have any other questions, let me know. Oh, and would you mind giving me a positive comment on Chapters.ca or Amazon.ca? And could I post this email to my blog? Others would probably appreciate it. Thanks!

Adam Letourneau

-- Drew

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