Professional services
Law Firm Billable Hours Calculator
Works firm billable hours and what they produce across timekeepers.
Result
Business arithmetic for running a practice, not legal advice. Fee agreements, contingency limits, trust accounting and fee splitting are governed by the rules of professional conduct in your jurisdiction, and several of them are strict. Check the applicable rules before any of this affects a client agreement. The gap between the stated rate and the effective rate is the number worth watching. Three separate leaks stack up: time that is never billable, billed time written down before invoicing, and invoices never paid.
Get a Free Business AuditHow the calculation works
Hours by timekeeper at their rates give standard value, reduced through realisation and collection to the revenue actually received. Across a firm the aggregate hides the distribution, and the distribution is where the management information sits: a firm hitting its total while two timekeepers carry it has a problem the total does not show.
What moves the number
- Hours by timekeeper, not just the firm total.
- Rates by level.
- Realisation, which differs by level.
- Collection by client type.
Where this one goes wrong
Look at the spread rather than the sum, because a firm meeting its aggregate target through a few people working excessive hours while others are underutilised is carrying both a burnout risk and an idle capacity problem simultaneously, and the total conceals both. The usual cause is work distribution rather than effort, which means the fix is how matters are assigned rather than how targets are set.
Before you quote
- Review hours by timekeeper, not in aggregate.
- Check whether the spread reflects assignment rather than effort.
- Apply realisation and collection by level.
Questions
About this calculator
What does the firm total hide?
The distribution. A firm meeting its aggregate while a few people carry it has a burnout risk and idle capacity at the same time, and the total shows neither. The spread across timekeepers is the number worth looking at monthly.
Why is realisation different by level?
Because clients write down junior time more readily, questioning both the hours and whether the task needed them. That means the nominal rate spread between levels overstates the actual one, and the gap is worth measuring rather than assuming.
Is an uneven spread a people problem?
Usually an assignment problem. Matters flow to whoever is already trusted with them, which concentrates work and leaves others short, so the fix sits with how work is distributed rather than with how hard anyone is trying.
The formula
billable hours = hours worked x billable share; collected = hours x rate x realization x collection
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How to use this calculator
- Hours worked per week. Enter your own figure; the page starts at 50.
- Share of time that is billable (%). Admin, business development and firm meetings are not.
- Working weeks per year. Enter your own figure; the page starts at 47.
- Hourly rate ($). Enter your own figure; the page starts at $285.
- Share of billed time actually invoiced (%). Enter your own figure; the page starts at 90%.
- Share of invoices collected (%). Enter your own figure; the page starts at 93%.
The result updates as you type, so you can try a figure, see what it does to billable hours per year, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Hours worked per week | 50 |
| Share of time that is billable | 62% |
| Working weeks per year | 47 |
| Hourly rate | $285 |
| Share of billed time actually invoiced | 90% |
| Share of invoices collected | 93% |
What comes out
| Result | Value |
|---|---|
| Billable hours per year main result | 1,457.0 |
| Billable hours per week | 31.0 |
| Value of hours worked | $415,245 |
| Actually collected | $347,560 |
| Effective rate per hour worked | $147.90 |
1,457.0 billable hours a year at $285 is $415,245 billed, but only $347,560 collected. Across every hour actually worked that is $147.90 an hour.
How sensitive the answer is
Holding everything else steady and changing only hourly rate, this is what happens to billable hours per year. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Hourly rate ($) | Billable hours per year |
|---|---|
| $143 | 1,457.0 |
| $214 | 1,457.0 |
| $285 example above | 1,457.0 |
| $428 | 1,457.0 |
| $570 | 1,457.0 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Hours worked per week
- A number, between 0 and 100, starting at 50.
- Share of time that is billable (%)
- Admin, business development and firm meetings are not.
- Working weeks per year
- A number, between 0 and 52, starting at 47.
- Hourly rate ($)
- A money amount, starting at $285.
- Share of billed time actually invoiced (%)
- A percentage, between 0 and 100, starting at 90%.
- Share of invoices collected (%)
- A percentage, between 0 and 100, starting at 93%.
What the results tell you
| Result | What it is |
|---|---|
| Billable hours per year | The headline result. A decimal figure. |
| Billable hours per week | A decimal figure. |
| Value of hours worked | A money figure. |
| Actually collected | A money figure. |
| Effective rate per hour worked | A money figure. |
Keep going
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