Sunday, July 10, 2011

Updating Lawyer Rates

When you opened the PCLaw program the very first time, you set up yourself as a timekeeper and entered your hourly rates. As self-employed individuals, your income tax returns were due in June, so now is a good time to review of your net earnings from the previous year.

Are you comfortable with your net income? Are there ways you can reduce costs? Are your recovery procedures capturing all client expenses? And finally, do you need to increase your hourly rate to become more profitable?

If you do determine an increase is needed, you would normally send out a notice letter to all of your clients, informing them that the increase will take affect on a forthcoming date.

How do you make the change in PCLaw?

Options – Lists – Lawyers and Rates. Select the lawyer – Change – edit the rates as you like – set the effective date, being the date in your notice to clients – OK - OK.

Entries made before the effective date will bill out at the old rate; entries made on or after the effective date will be billed at the new rate.

You may have one or two clients that comprise the majority of your billings, and they may not be open to a rate increase, and doing so could result in a loss of business. Or, you may be contractually obligated to maintain a certain rate for the length of a contract. Use Matter Manager to adjust the rates for these matters individually, adding a new rate for the effective date, if you changed/eliminated the old one.

As always, I invite your comments and suggestions for future posting topics. Next week – Numbering Variations.