Most of the internal budget for a legal department is compensation and benefits

It is well recognized that internal law department costs consist mostly of compensation and benefits. The data from ALM’s latest metrics collection corroborates that belief. In fact, it comes up higher than some general rules of thumb. Based on the numbers reported by about 70 U.S. legal departments, 86 percent of their internal spend went to the direct people costs of salaries, bonuses, equity awards, and benefits.

For every $21 of compensation and benefits spent, $1 (about 5%) was spent on occupancy costs and $37 dollars on comp for every technology dollar (about 3%). “Other” was 8% – perhaps CLE, travel, lawyer conferences, subscriptions, expert witnesses, consultants and the like. To learn more about the Law Department Metrics Benchmark Survey of ALM Legal Intelligence, click here for ALM’s website.