What is the difference between billable hours and regular hours?
Asked by: Cheyenne Collier | Last update: July 28, 2025Score: 4.5/5 (15 votes)
Billable hours means the number of hours worked that require compensation. In other words, they're the hours that you bill clients for, and they pay directly. Actual hours, on the other hand, are all the hours that an employee spends working rather than the hours that can be billed for.
What are billable hours vs actual hours?
Billable hours are the hours law firms charge their clients for, directly affecting their revenue. Conversely, actual hours encompass all work done by lawyers and staff, including non-billable tasks such as administrative duties and client relations.
How many hours a week is 1500 billable hours?
Let's break it down: 1500 Billable Hours Requirement: 1500 billable hour requirement translates to an average of approximately 29 billable hours per week over the course of a year (assuming a 52-week work year).
Are billable hours on top of salary?
In order to be profitable to your firm, you must make enough money from your billable hours not only to cover your salary and overhead, but also to generate revenue for the firm. It's not a complicated equation – the more hours you bill, the more revenue for the firm.
Why do lawyers bill in 6 minute increments?
There are numerous methods and techniques lawyers can use for time tracking and billing. Some are more laborious and time-consuming than others. Among them, 6-minute increments are a great way to keep track of your time and tasks. A chart with 6-minute increments also helps with calculating and invoicing.
Google Maps Platform: Updates to products, usage, and discounts
How do lawyers determine billable hours?
Billable hours are the time spent by a lawyer that require compensation from the client. Any dedicated time spent working directly on a client's case is considered a billable hour. Non-billable hours cannot be charged to a client but play an integral role in the firm's day-to-day operations and continued success.
How many billable hours are realistic?
The Goal is Between 1,700 and 2,300 Hours
Most law firms set a yearly billable hour target for their associates. This figure typically ranges between 1,700 and 2,300 hours, forming the average billable hour requirement.
Are billable hours stressful?
The pressure to meet billing targets while juggling numerous responsibilities can lead to stress, inefficiency, and burnout. However, with the right strategies and mindset, you can win the billable hour battle and boost your productivity.
What do 1800 billable hours look like?
To achieve 1,800 billable hours, an associate would work “regular” hours plus an extra 20 minutes Monday through Friday, or work one Saturday each month from 10:00 a.m. until 5:00 p.m. The first option would give an attorney 1,832 billable hours, with a total of 2,430 hours spent “at work” (AKA: including performing ...
How to calculate billable hours?
Multiply your hours worked by your hourly rate
Once you've added up all your billable hours for each service, multiply them by your hourly rate for that service. Then add together all the total amounts to get your final total.
What is the difference between billable hours and productivity?
If you work 32 hours for customers in your 40-hour working week, and spend the rest of your hours on internal work, you will have a productivity rate of 80%. Your billability is the number of your productive hours that you can charge to your customer.
Do paralegals get paid for billable hours?
Paralegals can bill for their substantive legal work similarly to attorneys, but typically at lower hourly rates than lawyers. In fact, most paralegals bill hourly and directly to clients. Paralegals billing hourly must know how to log portions of hours worked accurately.
What professions use billable hours?
- Advertising agencies.
- Consultants.
- Contractors or temporary employees.
- Freelancers, such as web developers, writers or graphic designers.
- Legal professionals.
- Public accountants.
- Public relations agencies.
Do you still get paid for non-billable hours?
Instead of thinking of non-billable hours as time you can't get paid for, you should think of it as an investment in your organization's future. You won't get paid directly for it, but the non-billable effort you put in now will help you increase profits and grow your business over time.
What are examples of billable hours?
Billable hours are the hours spent working on client projects. Non-billable hours are any that are spent on administrative or overhead projects that are not directly related to client service. For example, sending emails to clients would count as billable time.
Are billable hours separate from salary?
It's crucial for businesses to differentiate billable work from other tasks that add to employee hours but don't directly contribute to the employee's salary. Hence, understanding and managing billable hours are quintessential in improving billing practices and overall business profitability.
How many billable hours is a work week?
With that percentage in mind, you can set your billable hours targets. So, if you want to work a 40-hour week, try to get at least 30 billable hours in. If you want to work a 20-hour week, aim for at least 15 billable hours per week.
How many billable hours do lawyers work a week?
Although most lawyers have a regular 40-hour week, a significant percentage of them work more frequently. The average weekly work hours for various types of lawyers are: Lawyers working for large firms: 66 hours per week. Lawyers working for small and medium-sized firms: 42-54 hours per week.
Is 2300 billable hours a lot?
Typically, law firms require that their lawyers work between 1,700 and 2,300 billable hours per year, though it can vary by firm, practice area, and experience.
How many billable hours a day is 2000 a year?
For example, if you want to reach a goal of 2,000 hours annually, you would need to bill for roughly 40 hours each week, or eight billable hours a day. You may not work exactly eight hours each day, but this breaks down what you should average in a day, week, and month to reach your annual goal.
How do I check my billable hours?
You can either manually log the start and end times for each task or use time-tracking software that does it automatically. To calculate total billable hours, sum the time spent on all tasks for a client or project and multiply by your hourly rate to determine the total amount due.
How to increase billable hours?
- Analyze your team's non-billable hours. Tracking non-billable work helps you find places to reduce time spent on those activities that don't bring in revenue. ...
- Bill for all client-related work. Keep an eye on scope creep. ...
- Assign your team's billable work in batches.