Published on:

Ratio of associate fees to costs

A 1997 report by the California State Auditor of expert witnesses used by the California Department of Transportation’s Legal Division looked at expert witness fees. It found that payments made to one firm resulted in a ratio of billing rates to costs ranging from between 1.9 to 1 and 10 to 1. Overall, the ratio of billing rates to costs of that particular expert witness averaged 3.2 to 1, which was very close to the comparable figure from eight other expert witness.

Would it make sense for a law department to ask its key firms to disclose the ratio between what the firm pays an associate (plus benefits and other employee costs) and associate’s billing rate? The rest comprises firm overhead and partners’ profits.