Over the years, I’ve written a lot on the subject of timekeeping compliance. Or, why the heck can’t attorneys get their timesheets in on time?
Recently, I read an article in The American Lawyer, where I came across this interesting bit of info about the firm Fried Frank and its initiative to improve compliance. For those of you who don’t know the firm, it is an AMLAW 100 firm with about 500 attorneys.
The chairman of the firm, David Greenwald, basically made it his mission to improve productivity and efficiency. To do that he implemented a new partner self-assessment process and a $100 per day fine for timekeepers who are late to record their weekly billable hours. The latter, as he says in the article, fixed compliance issues “overnight,” and the former improved the overall firm culture.
Who doesn’t like an overnight fix? Can it really be that simple? I don’t know. But, if I was a firm with persistent timekeeping compliance problems, I might give it a try.
Choosing the Stick
After all, from my research, I’ve seen it work in other firms. Recall the DLA Piper fix of the “Red Card” system, which punishes senior lawyers that do not bill at least 7.5 hours of work each day. It works by issuing a “card” to partners who do not meet their quota. For partners who miss their targets consistently, it can then result in financial sanctions, such as having drawings and distributions withheld.
Or the Howard Kennedy approach: Fee-earners at this firm must average at least 5.6 billable hours of work each day. Those who fail to do this on a given week will first get a “warning” in the form of an email reminder. If this fails to have the desired effect over the course of a month, the firm will then block access to their computer.
We know, from our discussions with firms, that the firms with the greatest success in timekeeping create a culture of compliance. They do so by keeping expectations about timekeeping non-negotiable, consistent and clear. They also include incentives and/or penalties for enforcement.
Just Do It
I don’t know the exact math behind the Fried Frank penalty. But if an attorney submitted all their time on the last day of the month, it could be a costly penalty—in the range of $4,000 to $5,000. That definitely seems like a big enough “ouch” to make this system—which leverages the pain of significant financial penalties to enforce compliance—work.