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Internal fully-loaded costs to clients of lawyers per hour – another update of posts on an important metric

It is inexcusable for general counsel in this decade of cost scrutiny not to know and understand what their lawyers cost the company on an hourly basis, including but far from limited to their compensation. In-house legal talent comes at a cost that derives from pay and benefits, certainly and largely, but also from leverage, outside counsel usage, specialization, seniority, and infrastructure.

Twice before I have assembled metaposts on fully-loaded internal costs (See my post of Aug. 27, 2008: fully-loaded cost per lawyer hour with 31 references; and March 9, 2009: fully-loaded with 7 more posts.).

Since then the topic has remained very much alive (See my post of April 8, 2009: ratio of support staff; April 15, 2009: possibility that inside and outside costs will converge; Aug. 11, 2009: relationship with outside counsel payments; Sept. 5, 2009 #1: credit union expenses; Oct. 11, 2009: law firms bear technology and HR costs that law departments might not; Feb. 21, 2011: three unusual costs; April 13, 2010: fully-loaded costs are more accurate with time tracking; July 1, 2010: Hildebrandt benchmark survey gives $214 an hour in the US; and March 6, 2011: 5% annual increases for German law departments.).

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