Tiered billing-rate discounts based on factors other than dollar volume of services

In a previous post I discussed retroactive discounts based on dollar volume of billings (See my post of Aug. 8, 2006.) Given a sufficient number of cases a law firm might be asked to handle on a tiered-rate basis, the client and the firm might develop a taxonomy, a way to classify the cases such that different billing rates would apply for different kinds of cases.

For all cases classified as humdrum, the discount might be 15 percent; if moderately difficult the firm’s discount might be twelve percent off its standard rates. For cases classified as difficult, a firm might agree to only a five percent discount.

A firm could agree with a department that on New Jersey cases the firm grants a higher or lower discount. Or, on cases that seek more than $1 million in damages or that are brought by a particular firm, the firm grants a lower discount. The permutations are endless. The point is that discounts need not be based only on dollar volume.

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