Why flat fees get attention now
If a draft that once took three hours now takes one, an hourly bill falls by two hours of revenue. A fixed fee priced on the value of the outcome does not. Clients also like certainty. That is the case for flat fees; the risk is underpricing work that runs longer than expected.
Whether and how you may pass on, or reduce fees for, AI-assisted efficiency is a professional-conduct question. Check your bar's guidance and your engagement terms.
How to price a flat fee
- 1
Break the matter type into tasks
For example intake, drafting, review, client calls, filing and follow-up.
- 2
Look up your real time
Use recorded time from past similar matters, not memory.
- 3
Add a buffer for variance
Some matters will run over; price for the spread.
- 4
Value the outcome
Consider the result to the client, not only your hours.
- 5
Define scope in writing
What is included, what is excluded, and what triggers a fee change.
Billable hours and revenue calculator
Work out how many billable hours a year you can realistically bill, and what each hour of work is worth once write-downs and slow payment are counted.
- Hours worked per year
- 1,840
- Billable hours per year
- 1,012
- Value of time recorded
- $202,400
- Amount billed
- $172,040
- Amount collected
- $158,277
- Collected per hour workedWhat an hour of your working time actually earns.
- $86
- Billable hours needed for your targetAbout 16.7 billable hours a week.
- 767
An estimate from the figures you enter. Defaults are illustrative, not benchmarks. Fixed fees, trust money and tax are not modelled.
Keep tracking time anyway
Time records are how you learn whether a fixed fee was profitable. Compare the fee with hours logged per matter type and adjust next time.
| Matter | Fee quoted | Hours logged | What to check |
|---|---|---|---|
| Your sample matter A | Your figure | From your time records | Did scope creep? |
| Your sample matter B | Your figure | From your time records | Was the buffer enough? |
In MatterOS the Time database links entries to the matter, so fixed-fee matters can show hours against the fee. Use the calculator to test how a change in hours alters the effective hourly rate.
Switching cost and payback calculator
Estimate how long it takes for a switch to pay for itself once migration time is counted, using your own figures.
- Monthly saving
- $260
- Up-front cost including your time
- $3,099
- Payback period
- 11.9 months
- Net saving over 36 months
- $6,261
A simple estimate. It ignores lost productivity during the move, features you would lose, and anything you must keep paying for, such as billing or trust accounting.
Rules and client communication
- Check your bar's rules on fee agreements and any requirement to put them in writing.
- Check rules on fees paid in advance and where they must be held; trust accounting needs dedicated tools.
- Explain scope, exclusions and what happens if the matter changes.
- Do not promise outcomes.
Frequently asked questions
- Are flat fees better than hourly billing?
- Neither is always better. Flat fees suit repeatable, well-scoped work; hourly suits uncertain or open-ended matters.
- Can I charge flat fees for AI-assisted work?
- Rules on reasonable fees and disclosure vary by jurisdiction. Check your bar's guidance.
- How do I price my first flat fee?
- Use recorded time from similar past matters, add a buffer and define scope in writing.
- Should I stop tracking time?
- No. Time data tells you whether your fixed fees pay.
- Where do advance flat fees go?
- Rules differ by jurisdiction. Check your bar's rules and use proper accounting tools.
About the author
Raghav Handa trained as a lawyer, then spent years building legal technology, from enterprise legal products to custom systems for law firms.
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