What Are Billable Hours and Whats The Best Way to Track Them?

This article offers a full guide to creating invoices for your services. Organizational goals are strategic objectives that a company’s management establishes to outline expected outcomes and guide … Assuming 30 hours, outsourcing this work to a tech consultant at $65 per hour would create a net revenue boost of $7-14k per year. ‍The more efficient a firm’s processes, the more time there will be for billable work, and the more headspace can be devoted to it. By understanding what is going on outside the official billable activity, it is possible to protect the economics of the project while ensuring the client gets what they need.

You’ll know exactly how many hours each employee spends on a project and will be able to determine if they could be working faster or more efficiently. You can also use this information to pay them fairly when billing clients based on hourly rates. Billable hours https://www.bookstime.com/ are the total amount of time you spend working on a particular project. These hours are charged to a client according to an agreed hourly rate. In other words, they’re the number of hours a company can charge its clients for doing work on their behalf.

Is there an app to track billable hours?

There has to be a common agreement between you and client on the rates as you set up a contract. Now, the term “billable hours” can be somewhat deceptive because it implies that only entire hours are eligible for payment. In fact, attorneys often bill time to clients in 1/10 of an hour (or 6-minute) segments. For example, if you spent roughly 18 minutes on a task, you would bill the client .3.

This content is for information purposes only and should not be considered legal, accounting, or tax advice, or a substitute for obtaining such advice specific to your business. No assurance is given that the information is comprehensive in its coverage or that it is suitable in dealing with a customer’s particular situation. Intuit Inc. does not have any responsibility for updating or revising any information presented herein. Accordingly, the information provided should not be relied upon as a substitute for independent research. Intuit Inc. does not warrant that the material contained herein will continue to be accurate nor that it is completely free of errors when published. Assigning work in this way is a win-win for your organization, since billable and non-billable tasks will be completed more efficiently.

How can my law firm maximize billable time?

Tracking makes it easier to uncover what you need to do to make future collaborations and projects more profitable and successful. It gives you this baseline you can look at later on to predict what kind of planning will give you what outcome. It will also help you avoid certain pitfalls and risks in your future projects, especially if you choose to use some billable hours software for tracking. To get paid for services, many agencies, software shops, and consulting companies turn to billable hours, and for good reasons. As they say, time is money, and billable hours are clearly the bridge from one to the other. You might find that a particular type of project would be better billed at a fixed price to better reflect the overall work and effort put in by your team.

It’s one thing to track and understand billable and non-billable time. It’s another to know how much billable time each employee on your team what are billable hours should be working. See how ClickTime can help your organization decrease non-billable hours and get back to the work that makes you money.

How can technology help track billable hours?

Thankfully as we looked at before, there are free templates available that allow you to easily create an invoice. Plenty of times you don’t need to as the invoice will be integrated into the software or the client will have their own system for you to use. Trying to chase up your payments can take up a lot of time which is why you should agree on a billing cycle.

As we’ll discuss below, technology can help your law firm get there. But the billing process can become tricky if your firm charges different rates based upon the client, firm practice group, or lawyer seniority. Your firm will need to create a set of rate tables and apply those to different clients or matters. One-click timers used within time tracking software make tracking your billable hours super easy. In short, non-billable hours make the time companies don’t have to compensate. Everything done during that time is not exactly related to the client or done on their behalf. Instead, it usually covers the things team members do for your company, other internal projects, or just when going about their day.

Asana keeps your task list straight, so you and your team can do the best work of your life. So while you’re attempting to minimize non-billable hours, you’ll want to remember that not all non-billable hours are the same. Eliminating an hour of tedious or repetitive work is a good thing. But eliminating an hour an employee could spend developing their skills or that you could spend developing your brand will hurt your company in the long run.

In fact, many law firms require that their attorneys track their time throughout the work day so that all billable and non-billable times can be accurately recorded. Digital time tracker or manager is designed to record your working hours. It helps to simplify billing clients and provides data to support your invoicing. Such tools are ideal if you offer legal services or other work where keeping accurate records of billable hours is crucial.