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Law firm rates have increased since onset of pandemic

New research reveals that, despite the economic downturn caused by the age of coronavirus, the rates that legal departments are being charged have either remained steady or gone up rather than declining.

user iconJerome Doraisamy 05 January 2021 Corporate Counsel
Law firm rates have increased since onset of pandemic
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Blickstein Group has released its 13th Annual Law Department Operations Survey, which details the impact that COVID-19 has had on legal ops, together with the extent to which LDO professionals are seen as trusted and mature workers within a business.

“No one could have seen COVID-19 coming, of course,” said Blickstein Group principal and publisher of the Annual Law Department Operations Survey Brad Blickstein.

“But, LDO professionals were able to anticipate in 2019 that change was coming. With that foresight and the ability to adapt once the pandemic hit, the fallout has not been nearly as bad as we thought it would have been. Law departments have been able to meet the needs of their clients.”


The research did, however, denote a “major shift” in the financial impacts upon businesses compared to the global financial crisis of 2008.

“At that time, rates stayed flat and even were reduced in many instances before rebounding after a few years. But that doesn’t seem to be the case this year,” Blickstein Group wrote.

When asked how their law firms’ rates have changed over the past year – that is, looking back to pre-pandemic times – nearly one in five (17.9 per cent) of LDO professionals said firm rates have increased by more than 5 per cent. Over half (51.8 per cent) said that rates have gone up less than 5 per cent in that time.

Just over one-quarter (26.8 per cent) said rates have remained flat, while just 3.6 per cent of professionals said rates had decreased in the past year.

The outlook for 2021 isn’t promising for LDO professionals, either.

Just 9 per cent expect that rates will go down, and slightly under half (44.6 per cent) think they will remain flat. On the other end of the spectrum, 37.5 per cent of LDO professionals think that rates will increase by less than 5 per cent in the coming year, and 8.9 per cent are anticipating rate hikes of more than 5 per cent.

However, there were also slight increases in the volume of law firms offering discounts on their bills, the research found. 

This past year, 96 per cent of LDO professionals said that their law firms discounted their hourly bills, slightly up from 91 per cent of firms last year. Overall, 61 per cent of LDO professionals and their businesses are getting discounts on more than half of their bills from firms, up from 56 per cent last year.

But, as Blickstein Group noted, these discounts do not amount to a “pandemic-sized” increase on the cuts offered by firms in 2019, meaning that – when taken together with the above findings pertaining to rate increases, the financial hit suffered in this time has been vastly different to that suffered 12 years ago.