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Billable Hours

Prospecting, marketing, and other activities related to business development . This tells you how many staff you need to complete a project, the critical areas for improvement, and, additionally, highlights any gaps so you can meet the agreed deadlines. Getting on a 30-minute call about a potential project or doing a pitch to a potential client.

Doing effective billable hours accounting will help you figure out how much time, funding, and other resources were required for a specific project or collaboration. Instead of struggling with ballpark numbers, you get specific data that will help you make fast and effective decisions when planning future projects and selecting clients to work with.

One of the major benefits of tracking working hours is the ability to determine your and the productivity of your employees. To figure out how productive your employees are, you can compare their billable and non-billable hours. If someone has too many non-billable hours, try to find out the reasons for that (it can be due to the client’s requests or something else). You can figure this out by reviewing the non-billable hours of your employees. For instance, let’s say that client A has requested numerous updates during the project, which is why your staff had 20 non-billable hours last month. On the other hand, client B only had minor changes, which resulted in 5 non-billable hours for your employees.


Knowing how long it takes you to complete a project helps you set an hourly rate that allows you to make money and run a sustainable business. Administrators of law firms should track both realization rates and utilization rate of employees. In addition, there should be a monthly report that makes a comparison between the billable hours that are recorded, and fees collected.

This is how you can assess key areas where you need extra staff or additional training. In addition, you’ll have other expenses to consider – employee development and training, invoicing and bookkeeping activities, company meetings, and more. Expert advice and resources for today’s accounting professionals.


This is because some cases involve a large number of documents as well as staff time to make copies and send faxes. Tracking both billable and non-billable time helps you understand the true costs of running your business, assign realistic workloads to employees, and provide more value to your clients. So while you’re attempting to minimize non-billable hours, you’ll want to remember that not all non-billable hours are the same.

Other instances include project-related research, site visits, and modifications or revisions done at the client’s request after the initial deliverable. The goal of any operations or activities in any organization’s office is to ensure quality deliverables as far as customers are concerned. Hours are displayed in a column, which are the total number of hours that were worked per issue. This makes it easy to compare the Billable vs Logged hours per issue. This way, the time logged to each Jira issue is grouped into the customer’s account. Permissions to create a new customer, accounts, and categories. You need Jira Administrator Permissions to grant this Global permission.

  • You and your employees need to remove any form of distractions and tackle procrastination during working hours.
  • A billable hours quota of over 2,000 hours per annum is not unheard of.
  • With Hiveage you can send elegant invoices to your customers, accept online payments, and manage your team — all in one place.
  • This will help attorneys ensure that they are capturing and billing as much of their time as possible.
  • Asana keeps your task list straight, so you and your team can do the best work of your life.

In general, when lawyers have less than 100 percent of their billable hours, this could be an indicator of a problem. These issues could happen due errors in pricing systems, or due to duplicate work, and etc. If you track all your time, not just your billable hours, you’ll be able to look back at your work day and see where you can become more efficient. Or, if you’re spending a lot of time invoicing, you may want to invest in accounting software that allows you to automate the invoicing process.

How Do You Calculate Billable Hours?

Clockify is a time tracker and timesheet app that lets you track work hours across projects. So, if a lawyer has 2,340 billable hours per year and a total yearly available number of 3,120 hours, we’ll divide 2,340 by 3,120. Speaking of lawyers and legal professionals, their ideal utilization rate is 100 percent. So, their goal should be striving to achieve as high utilization rate as possible.

  • So, non-billable activities, like administration tasks, will keep your business running smoothly.
  • That means out of eight hours, if a technician does approximately 2.4 hours of billable work per day, the billable hour percentage averages 30 percent.
  • PracticePanther is a leading cloud-based law practice management software solution that serves tens of thousands of legal professionals in 170 countries.
  • Keeping good track of your time will help you to figure out where you may be wasting it!
  • These hours include all the time that you spent working on a certain task.
  • For example, you can’t’ bill for the time you spend on invoicing, marketing, and finding new clients.

Estate Planning A Guide to Wills and Estate Planning Software For estate planning attorneys, the client’s legacy is their primary responsibility. Attending any meetings with people who aren’t yet contracted clients. For workers like consultants, freelancers, and contractors, a full day’s work, hopefully, looks a little different.

Agreeing On An Hourly Rate

3E is a SaaS practice and financial management platform that connects all critical areas of a law firm to streamline tasks and provide timely information. You should have all your billable hours stacked up at this point, and you’re ready to create your invoice. Now it’s time to start tracking the time spent on client work. Non-billable hours are the hours you spend for which you cannot charge a client. Accurately tracking their billable hours helped PR Firm, Sweat+Co, recuperate 20% of their profitability.

Billable Hours

Tracking billable hours allows you and your team to have a clear picture of how much time is spent on each task. This way, you can identify where you or your team can improve and how to maximize earning potential. Tracking will help you know how much time you spent on a project and what tasks took up the most time. This will help you create better estimates for future projects, and reduce the chance of unhappy clients. You’ll also be able to identify which clients or projects use more of your time than others and adjust your rates accordingly.

Invest In Quality Time Tracking Software

While it might be faster to bill for blocks of time, list tasks separately for accuracy, accountability, and clarity to clients. The standard process for calculating billable hours looks something like this.

Billable Hours

There are other tasks related to your client’s project that are also non-billable hours. These include the initial proposal to get the job and sending the invoice after it. The client would not expect you to exclude these when calculating billable hours. These hours include all the time that you spent working on a certain task.

That means out of eight hours, if a technician does approximately 2.4 hours of billable work per day, the billable hour percentage averages 30 percent. To determine projected billable hours per tech, you must calculate what percentage of a technician’s workday results in billable hours, on average. Recording non-billable hours makes revisiting your tasks easier.

But all those small increments of billable time can add up over the span of an entire project. Track every minute you spend working on a client’s project to increase your billable hours. At the end of each billing cycle or when you complete a client’s project, review your time log and calculate your total billable hours for the project.

This content is for information purposes only and should not be considered legal, accounting, or tax advice, or a substitute for obtaining such advice specific to your Billable Hours business. No assurance is given that the information is comprehensive in its coverage or that it is suitable in dealing with a customer’s particular situation.

Why Should You Track Non

Non-billable hours (sometimes called “overheads”) refer to any work done that doesn’t get invoiced to clients. Businesses have to have non-billable hours to ensure their internal processes run smoothly, and they can have a positive effect on company culture if they are managed correctly. Even though the term billable hours is vastly used in legal practices, it is also used in all other sectors where someone needs to be reimbursed for working on a project. This term defines how your time can get invoiced and compensated.

You will be able to identify those non-billable tasks which might be taking up more of your time than they should, and make appropriate changes to streamline those processes. When you send a bill or invoice to a client, ensure it goes with a full description. So, instead of indicating something like ‘2 hours of a call’ for example, you’re better off indicating what the call was all about.

Prove how much time you spend working, so it can be easy to negotiate a higher salary or billing rate. If you have a good automated invoicing system, you will stay consistent and thus avoid missing invoices.