Law firms rush to collect on unpaid bills
Law firms have been scrambling to collect payment before the end of the year - a sensitive task if it is to be carried out effectively while maintaining goodwill with clients. comments powered by Disqus
Most US law firms link partner compensation to the amount of work they bring in, but work isn’t counted as revenue until bills are paid, so partners have extra incentive to ensure that accounts are settled before the end of the calendar year.
According to Vincent Cino, the chairman of employment law firm Jackson Lewis, which made more than $352 million in revenue last year, thirty per cent of his firm’s revenue is collected in the last three months of the year.
The entire process has been made more difficult by increasingly sophisticated and demanding clients, who may query or reject parts of their legal bills. And firms are reticent to sue clients over unpaid bills because they want to avoid unwanted publicity or counter-suits claiming malpractice.