According to an article on Quartz, Microsoft will require all of the law firms with which it works to move to a retainer or other billing approach for most legal matters, rather than billing by the hour, within two years.

As the article points out, the billable hour may be traditional and standard procedure for law firms, but it is costly for clients and inconvenient for lawyers. Billing by the hour, and especially the practice of “rounding up” all tasks no matter how small into six-minute blocks (or whatever the metric may be), is often the source of unhappiness and disagreement between lawyers and their clients.

The demand that lawyers move away from the billable hour by a major corporation like Microsoft, which – as the article points out – “spends hundreds of millions of dollars on litigation annually” and is therefore in the driver’s seat when it comes to its legal services, may well herald a major shift across the board.

Are you prepared to offer alternative fee structures to your clients if they want the same treatment as Microsoft – or to get ahead of the game by offering creative fee options to your major clients before they start demanding them?

Let me know your thoughts on this or any other matter related to the law, either in the comments section below or directly via email.