Global law firm Clifford Chance came under fire in Europe last year when an internal memorandum made its way into the public eye.
It revealed a billing culture in which associates and partners were required to bill 2 420 hours of work annually. On a 40-hour week, multiplied by 52 weeks, there are 2 080 working hours in a year.
In SA, rates charged to clients can go as high as R2 250/hour. Most commercial firms have a range that begins at R300/hour.
Werksmans senior partner Carl Stein says local attorneys charge a fraction of what US and UK lawyers of equivalent standing are billing.
The American Bar Association says attorneys must charge "reasonable fees". Some clients may take issue with what is "reasonable", but typical US commercial law firms charge between US$250 and $300/hour. At an exchange rate of R7,80, that's R1 950-R2 340/hour.
According to the New York Lawyer , first-year associate compensation in New York went from $90 000 in 1997 to a high of $165 000 in 2000, when bonuses hit $40 000.
Though Clifford Chance attracted enormous attention, particularly in that the bonus requirement encouraged "padding" of billable hours, the firm has hardly been alone in basing bonus awards on hours.
Sidley Austin Brown & Wood was straightforward in announcing an hours-based bonus last year. Under its scheme, first-year associates could earn $25 500 for billing at least 2 400 hours.
Cliffe Dekker chairman Chris Ewing says SA firms are not doing the same sort of thing as Clifford Chance and others.
Cliffe Dekker's charge-out rates range from R300 to R2 250/hour.
Ewing says professional staff are expected to bill about 1 500 hours annually. This translates into 6-6½ billable hours a day.
Candidate attorneys are not required to write fees as they are "lawyers in training".
Webber Wentzel Bowens professional staff committee chairman Nick Robb says the firm charges between R325 and R2 250/hour. The fees depend on the type of work being done.
Werksmans' Stein says the firm's rates range from R400 to R2 250/hour. The firm has a budget of 1 200 billable hours a year.
Candidate attorneys are required to write fees from a practice management perspective. "But they are not a profit centre, they are a loss."
Deneys Reitz chairman Michael Hart says professional staff are required to bill 1 400 hours annually. The firm has an incentive scheme to reward staff for exceptional levels of service.
But it is important for lawyers to lead a balanced life, says Cliffe Dekker director Jean Meijer. "There should be a balance between work and private life. Billing 2 420 hours is unrealistic and creates an unhealthy working environment."
Professional assistants at the top commercial firms usually earn a salary of R13 000-R18 000/month. A junior associate will earn R20 000-R23 000.
A first-year associate is generally expected to write fees of R50 000-R60 000/month.
A senior associate will write fees of R125 000/month.
