Australian law firms lag global counterparts in AI uptake

Cloud-based legal practice management platform LEAP Legal Software has released its Profitability in Law: Global Report 2026, which received responses from 700 legal professionals globally, 219 of whom were polled in Australia.

While 57 per cent of international legal professionals reported regular use of integrated AI tools, that number drops to 37 per cent in Australia. Subsequently, 71 per cent of global respondents said that AI was helping them save time in their regular workday; however, that figure drops to just 50 per cent Down Under.

“Our research shows that Australian firms are currently behind other markets in the adoption of legal-specific AI tools,” Tina Shergold (pictured), head of LEAP Australia and New Zealand, said in a statement.

“While the caution is understandable given the importance of accuracy in legal work, firms that delay adoption too long risk missing out on the productivity gains that AI is already delivering elsewhere.”

The research also showed that pricing pressure, administrative workload and uneven AI implementation are also shaping firms’ ability to convert that ambition into results.

“The Australian legal sector is entering a phase where profitability will depend less on how much work firms win and more on how efficiently that work is delivered,” said Shergold.

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“Firms remain confident about growth, but pricing pressure and rising operational complexity mean productivity gains will increasingly determine how successfully firms convert demand into sustainable margins.”

Elsewhere, and despite three in five (61 per cent) of Australian firms prioritising competitive salaries, retention pressures remain present across the profession, with workload intensity and burnout continuing to influence workforce stability.

Such instability, LEAP said, has led to increased risks in knowledge continuity, with 33 per cent of Australian respondents reporting no documented processes in place when staff leave, creating potential gaps in training, consistency, and service delivery.

Shergold said: “Many firms are operating with lean teams and limited support staff, which means experienced practitioners are carrying a large share of the administrative and knowledge burden.”

“Improving how knowledge is captured and shared within the firm is becoming increasingly important for maintaining both efficiency and service quality,” she said.

Technology investments generally are viewed positively, however. Investments in automation, document management, and legal research tools are expected to improve productivity and efficiency, despite platform fragmentation impacting workflows.

“The Australian legal sector is in a strong position, with firms confident about their future growth,” Shergold said.

“The challenge now is how firms translate that confidence into more efficient ways of delivering legal work, particularly as pricing pressure and operational complexity continue to increase.”