The world’s largest companies successfully cut Biglaw’s billing rates in 2020, but law firms are still ahead of the game by increasing the tab for smaller clients, according to a new report.
Thomson Reuters’ Legal Department Operations Index 2021 shows increasing scrutiny of legislative proposals, with “controlling external legal fees” identified as a top priority by corporate legal departments.
The companies with the greatest purchasing power even moved the needle – those with annual sales of more than $ 10 billion saw rates decline across the board in 2020. But their smaller competitors stayed in hand as the overall rates of law firms generally rose.
The largest companies “had put considerable pressure on rates in 2020 and all types of timekeepers saw declines,” the report said. “In fact, this is the first report in which we have seen a decrease of this magnitude.”
“Perhaps in response to this, law firms were able to increase rates overall and achieve significantly higher job increases for smaller-sized companies compared to the previous year.”
Legal Department Operations (LDO) Index 2021 (Sixth Edition): The Risk of Being Left Behind [Thomson Reuters]
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