Dan Bowman

Law firms amass sensitive client data and confidential information, an appealing reward for a sophisticated cyber attacker. According to the 2022 ABA Cybersecurity Tech Report, 27% of law firms experienced a security breach.

Law firms need to be proactive about data security so they don’t become a statistic. Learn about your ethical responsibilities to cybersecurity and how you can mitigate your firm’s risk of a cyberattack.

American Bar Association (ABA) Data Compliance Rules and Regulations

Lawyers have a professional and ethical responsibility to protect client data and disclose a breach if it occurs. According to the ABA Rule 1.6: Confidentiality of Information, lawyers must “make reasonable efforts to prevent the inadvertent or unauthorized disclosure of, or unauthorized access to, information relating to the representation of a client.”

The ABA also has several Ethics Opinions that guide lawyers on how to address cybersecurity:

• Securing Communication of Protected Client Information
• Lawyers Obligations After an Electronic Data Breach or Cyberattack

Data Compliance Regulations Your Law Firm Should Know

Data security laws are complex and can vary by location, especially for law firms that may handle clients in different locations or with different types of sensitive information. Here are some data compliance regulations your law firm needs to know.

General Data Protection Regulations (GDPR)

In 2018, Europe introduced a unified data protection law, GDPR, for businesses handling personal data. This law requires enhanced protection of personal data for EU individuals. While this only applies to companies in Europe, the regulations could impact a US law firm. It’s best to learn about GDPR and stay compliant.

Health Insurance Portability and Accountability Act of 1996 (HIPAA)

HIPAA is a federal law requiring healthcare providers and business associates to safeguard protected health information (PHI) from accidental disclosure. Law firms are considered business associates and may have access to medical records for cases, so it’s essential to comply with HIPAA when handling PHI for clients.

California Consumer Privacy Act (CCPA)

In 2020, California introduced CCPA to mirror GDPR and require enhanced protection of personal data for California residents. Law firms that operate in California or have California-based clients must be compliant with CCPA.

Stop Hacks and Improve Electronic Data Security Act (SHIELD)

Like California, New York introduced SHIELD to safeguard personal data. This act includes a requirement to implement reasonable security safeguards for any business in possession of the personal data of New York residents. This is in addition to the state’s existing data breach notification requirement, which is one of the strictest in the country.

Federal Trade Commission (FTC) Act

The FTC Act allows the FTC to prosecute businesses for unfair or deceptive acts or practices, including apps or websites that contain misleading information about privacy and security. This rule applies to all US companies regardless of industry and extends far beyond data privacy. One of the toughest aspects of the FTC Act is that the organization issues fines to companies that aren’t compliant and continues to levy them until it’s resolved.

Best Practices for Data Compliance in Your Firm

Be Proactive, Not Reactive

A reactive approach to mitigate cybersecurity incidents means you’re always one step behind. Law firms are a valuable target for hackers, so it’s important to take a proactive approach and implement security measures before a cyberattack happens. This not only reduces the risk of attacks in the first place but limits the damage if one occurs.

Create a Security Policy

An unfortunate number of security issues start with user error, not flaws in the tech. Your firm needs a clear, easy-to-follow plan for data security that everyone at the firm is privy to. Educate your employees and enforce best practices like multi-factor authentication (MFA) for logins and only using approved apps.

Train Staff

Despite the best intentions, staff can be a weak link in your firm’s data and cybersecurity. Compromised credentials, accidental link clicks, or weak passwords can be an access point for a hacker. Don’t assume your employees know how to recognize and report suspicious behavior – train them. Create a culture of cybersecurity and conduct regular training with current staff and new hires to keep everyone on the same page.

Use Tech with Legal-Specific Security Controls

Data security is ultimately the ethical responsibility of your firm, but the law practice management software you use can make this more challenging. Make sure you vet your vendors thoroughly to ensure that they’re as committed to cybersecurity as your firm.

The ideal option is working with a law practice management solution that uses legal-specific security controls, including MFA, activity tracking, user permission controls, and secure client communication portals.

Updates in Data Compliance

As high-profile breaches rise, more and more states and jurisdictions are implementing their own data compliance and information security rules. It’s possible that there will even be a federal data compliance regulation like GDPR.

There are 15 states that have bills in progress, as well as three that have laws on the books that went into effect this year:

• Virginia Consumer Data Protection Act (CDPA): As of January 1, 2023, Virginia CDPA will protect the privacy rights of state residents.
• Colorado Privacy Act (CPA): CPA will go into effect on July 1, 2023, and grants Colorado residents rights over their data. This act is similar to CCPA.
• Utah Consumer Privacy Act (UCPA): The UCPA goes into effect on December 31, 2023, and offers businesses a little more leeway than other states. It only applies to businesses that target Utah residents, have revenue of $25 million or more, and meet thresholds for data collection.

International regulations are also changing and affecting international markets. South Africa, China, and the United Arab Emirates all passed privacy legislation in 2021, and it’s likely that other countries will follow. The US and EU also have a preliminary deal to outline how US-based companies can store the personal data of European residents.

Stay Compliant with Legal-Specific Software

Robust data security isn’t a step above any longer. It’s an essential part of running a business, including a law firm. With the sensitive information your firm has, it’s essential to be proactive in safeguarding data security and mitigating the risk of a breach with security controls, training, and security-focused law practice management software. 

Law firms are businesses and modern consumers expect the same security, convenience, and flexibility to pay for legal services as they do for other transactions. If your firm doesn’t offer a variety of electronic payment options, you could be falling short of client expectations – and missing out on clients as a result.

Learn more about the options for electronic payments for law firms, their pros and cons, and how you can reap the benefits of a more streamlined payment system with law firm billing software.

The Importance of Electronic Payment Methods at Law Firms

Electronic payment encompasses virtually all technology-enabled methods of handling transactions, whether through credit card, eCheck, or bank transfer. These methods are similar to accepting cash, paper checks, or money orders, except they exist in the virtual space and not the physical one.

The COVID-19 pandemic ushered in more acceptance of electronic payment methods to avoid handling cash or physical cards, but clients have been moving in that direction for a while now. According to the 2023 Future of Payments Survey from Onbe, a market-leading corporate disbursements platform, 70% of respondents prefer to receive payments digitally and 73% prefer to shop and pay with digital methods.

This trend clearly illustrates that consumers are seeking electronic payments, even when it comes to law firms. It’s essential for your firm to modernize and offer these payment options to promote a better client experience and attract and retain clients.

Types of Electronic Payment Methods

Credit and Debit Cards

Credit and debit cards offer a convenient way for clients to pay. With a credit card, they have a revolving line of credit to pay a large bill at once and make more manageable payments over time. Debit cards function like checks or cash, allowing the client to pay a bill directly from their bank account.

According to a TSYS survey, 75% of people prefer to make online payments with a credit or debit card. It also revealed that 65% of people expect credit or debit cards to be a payment method option, even for law firms.

Pros:

• Credit and debit cards are familiar to clients and tend to be the method they use to pay for virtually everything in their day-to-day lives.
• They’re more convenient and offer a quick, easy, and secure method to pay with the peace of mind of knowing their bank or credit provider has them covered for disputes.
• For your firm, credit and debit cards get your firm paid faster. Clients are more likely to cover their bills quickly if they have a convenient method – especially if you have a secure payment platform.

Cons:

• Credit and debit cards have processing fees that you’ll either need to cover yourself or charge to the client, which is a negative aspect of the experience for clients.
• There’s a risk of fraud, but that can be mitigated with a secure payment processor.

eChecks

Electronic checks, or eChecks, are a digital version of a conventional paper check. eChecks are delivered via the Automated Clearing House, or ACH, which is how many people get their direct deposits from employers.

Conventional paper checks are falling out of favor with clients, so it’s possible that eChecks will replace them completely. According to a survey, 55% of consumers don’t use or rarely carry their checkbooks. Among young consumers, 61% have never written a check.

Pros:

• ACH processes eChecks safely, securely, and quickly, typically over the Internet.
• eChecks are safer than conventional checks, as they can’t get lost in the mail or be forged.
• eChecks have a faster delivery than a paper check that needs to be mailed or dropped off.
• The cost of processing an eCheck is much lower than a conventional check.

Cons:

• eChecks carry a risk of fraud, but this can be reduced with a compliant payment processor.
• Processing times are a bit slower than other forms of payment, such as credit cards.
• Lawyers need to follow ethical guidelines with eChecks.

Virtual Cards

Virtual payment cards are an option that’s similar to having a debit card or credit card in that they have a card number, CVC, and expiration date, but they’re only valid for one use for a predetermined amount.

Pros:

• Virtual cards are single-use for a predetermined amount, so they’re less susceptible to fraud than credit or debit cards.
• Companies can control the amount and limit unauthorized spending.

Cons:

• Predefined limits and expiration dates on virtual card payments restrict law firms’ control and flexibility.
• Technical issues with virtual card systems can disrupt payments, causing delays or failures.

Bank Transfer

Bank transfers are a simple way for clients to transfer money directly out of their bank account using their routing and account numbers. The entire process is straightforward and secure.

Pros:

• Bank transfers ensure that the funds are available.
• They can be processed quickly.
• Bank transfers are processed as wire, electronic transfer, or eCheck.
• You’ll receive an instant notification that a payment is in progress.

Cons:

• Bank transfers can face delays and errors, causing issues for law firms requiring prompt payments or fund receipts.
• Transaction fees for bank transfers, particularly international or currency conversions, can impact a law firm’s financial efficiency over time.
• Bank transfers lack transparency, making it difficult for law firms to track and reconcile financial transactions in real time compared to online payment platforms.

Mobile Payments

Mobile payments have increased in popularity with the ubiquity of the smartphone. According to data from Juniper Research, mobile contact payments will exceed 49 billion in 2023 and have grown 92% over the past two years.

Mobile pay is similar to an actual wallet and holds all the user’s credit card and banking information, except it’s stored securely in a virtual space.

Pros:

• Mobile pay is more convenient than a physical wallet since everything is stored on a smartphone.
• Clients can pay from anywhere when it’s most convenient for them.
• Clients have the option to pay with whichever method they prefer, from ACH to credit cards.
• Law firms get paid faster because clients have all their payment information at their fingertips.

Cons:

• Limited acceptance of mobile payments restricts law firms’ payment options and can cause inconvenience.
• Mobile payments pose security risks, requiring law firms to implement robust security measures.
• Law firms relying on mobile payments are susceptible to disruptions due to technical issues and connectivity problems.

Improve Collections at Your Law Firm with Bill4Time

If you want to modernize your firm to accept digital payment methods, Bill4Time’s billing, payment, and law firm invoicing software helps you support these goals. 

The native payment processor, Bill4Time Payments, allows you to accept online payments and process all transactions within the same secure system you manage your practice. Industry-low transaction fees and best-in-class payment technology get your firm paid 70% faster than average billing practices. 

With Bill4Time Payments, your firm also benefits from: 

• Legal-specific software that maintains compliance with accepting online payments 
• Custom payment links that can be added to invoices and emails to get paid from anywhere
• Payment plans with automated reminders to reduce large bills so clients pay their bills on time
• Robust reporting to easily track and allocate payments to the proper client or matter

Bill4Time reduces the administrative burden often associated with the billing and collections process by streamlining how your firm gets paid. If you’re ready to adopt online payments without worrying about compliance, you can book a demo today!

Many law firms rely on the traditional billable hour for legal services, but there’s a growing trend for law firms to adopt value billing. More than just an alternative fee structure, value billing offers clear expectations, better client experiences, and fees for legal services that offer true value for both the client and the lawyer.

Continue reading to learn more about what value billing is, how it can benefit your firm and clients, and how to go about implementing it.

What Is Value Billing?

Value-based billing is a pricing model that’s based on the perceived value of your legal services and a successful outcome. Value is subjective, so coming up with a perceived value relies on collaboration and research.

Unlike traditional pricing models for law firms that include an hourly fee and billable hours that are invoiced, value-based billing is considered an alternative fee arrangement. Instead of tracking the number of hours performed on case-related work, the fees align with the output or outcome of a case, such as creating deliverables like contracts.

Benefits of Value Billing

Value billing offers many benefits, including:

Increased Client Satisfaction and Loyalty

The value-first pricing model ensures the best possible value for the client, which is a factor in referrals, reviews, and an influx of new clients from word-of-mouth recommendations. It’s a more client-centric approach to legal services and gives them a clear expectation for what they’ll pay, which reduces anxiety about obtaining and affording legal services.

Improved Profitability and Revenue Generation

The value-first pricing model improves profitability and revenue directly and indirectly. First, it ensures that you’re charging what you’re worth based on the value you provide for your clients, rather than the hours you spend on a case. Indirectly, value billing increases client satisfaction, facilitating referrals and new business that will keep your firm profitable in the long term.

Enhanced Efficiency and Productivity

Lawyers spend a lot of time on non-billable business tasks, including tracking, data entry, and billing for those billable hours. The rest of the time, they’re working but not earning direct revenue — even if the process is streamlined with time tracking software.

Value-based pricing can take time to set up initially as you analyze how to quantify the value your firm brings. Once the fees are determined, it eliminates a lot of the time spent on tracking time. Your firm becomes more efficient and productive with a lesser burden of administrative tasks.

Opportunities for Alternative Fee Arrangements

Value billing offers a lot of opportunities for alternative fee arrangements, such as flat-fee pricing for legal services, contingency pricing, retainers, subscriptions, and sliding-scale pricing. Each of these pricing models are suitable for different practice areas and offers benefits for both the client and the lawyer.

For example, flat fees are simple and predictable for certain cases, such as a no-fault divorce or drafting a will. Contingency, which is popular among personal injury attorneys, is a good option for cases that include a payout for a positive outcome.

Enhanced Focus on Client Outcomes and Results

With value pricing, you’re focused more on getting a favorable outcome than the time you spend on a case. Your pricing depends on your performance and the value you provide to your client, making the entire experience more positive overall.

Steps to Adopt Value Billing

If you want to adopt value billing at your firm, here are the steps:

Assess Your Firm’s Practice Areas and Client Base

To implement value-based pricing, you need to have an understanding of the client base, the commonality of work in the practice area, local competition, and the complexity involved.

Identify Suitable Cases or Matters for Value-Based Billing

Value-based billing is more appropriate for some cases than others. For example, simple and straightforward casework like completing a will and estate, reviewing and creating contracts, or drafting immigration applications.

Establish Clear Pricing Structures and Fee Arrangements

Communicating clearly with the client is important with any fee structure, but more so with value-based pricing. The ABA recommends offering tiered levels of service that vary in price to give clients options for perceived value and affordability. This also allows you to gauge price sensitivity for future pricing.

Collaborate with Clients to Define Values and Outcomes

Perceived value relies as much on how much you expect for your services as much as what the client expects to receive in return. You can talk with clients to understand their goals and motivations for seeking legal help, which in turn informs the value of your services, but it’s good to use industry benchmarks as well.

Implement Effective Tracking and Reporting Mechanisms

With Bill4Time, it’s easy to outline your tracking and billing processes with detailed invoices and statements that include payment terms, flat rates, or discounts. Whether you use value pricing across the board or for certain matters, you can customize your rates for each client to simplify the process. You can also track expenses and evaluate your firm’s performance with detailed financial reports.

Common Challenges with Value Billing

Though there are benefits to value billing, it can be difficult to determine exactly how much a client may value your services in monetary terms. It takes some calculating, benchmarking, and time to determine your pricing and expenses. There’s also the potential to undercharge your work.

With value billing, as with hourly billing, the paramount benchmark is ABA Model Rule 1.5(a). Lawyers are not permitted to charge an unreasonable fee for expenses, no matter the fee structure.

It will also take work to set up legal billing processes to adjust to a new fee structure and ensure that it’s clear and compliant. Legal software like Bill4Time simplifies your billing process with custom billing rates and structures tailored to your firm’s needs.

How to Manage Client Expectations with Value Billing

Value billing can provide transparency and satisfaction for clients, but it’s essential that you communicate your fees and services clearly. Instead of focusing on the time involved, communicate in terms of the value that you provide to your client in addressing their legal issues.

Setting up expectations from the start builds trust and transparency in the billing process. When your client receives an invoice, there will be no surprises. They understand exactly what they’re getting for their money.

In focusing on your value, it may be helpful to provide examples in the form of client feedback and testimonials to validate and promote your value-based billing. This forms social proof that gives your client confidence that they’re getting actual value for your services.

Final Thoughts on Value Billing

Legal services are all about value. Using value-based billing gives clients more predictability and transparency in paying for legal services, supporting a client-centric experience that drives word-of-mouth referrals and client acquisition. For firms, value billing is more efficient and productive, providing real value for services without compromising client experience, making it the future of billing in the legal industry.

Project management has been essential in the corporate world for a long time, but it’s also important for any law firm looking to stay competitive.

Using skills like risk management, planning, budgeting, and resource allocation, law firm project management creates consistency for lawyers and law firm processes and ensures a positive experience for clients.

What Is Law Firm Project Management?

Law firm project management, or legal project management, is the management of processes and delivery of legal services using a defined methodology. In the legal industry, “projects” are anything a lawyer completes, including cases, matters, deals, disputes, contracts, or agreements.

By leveraging different aspects of project management from other disciplines, legal practice management provides structured work in managed stages for measurable and predictable results.

Why Is Law Firm Project Management Important?

Law firm project management arose in response to changing market demands. The legal industry may be traditional, but client expectations, market competition, and other factors are pushing law firms to become more cost-effective and proactive.

Sound, efficient processes are integral to success for firms of any size, especially as they grow and scale. Having established processes in place means that projects and their results are consistent for an elevated client experience.

There are additional benefits, including:

• Predictability in how projects are approached, how long they will take, and how any obstacles will be addressed
• Efficient planning for lower costs and better budgets
• More client satisfaction with consistent, transparent experiences

Why Law Firms Struggle with Project Management

Even if they recognize the need for project management, many law firms struggle to put it into practice. In general, the legal industry can be largely traditional, but there are other obstacles that can hinder effective project management.

Many firms struggle with limited staff. Adding project management tasks to an already full plate stretches resources too thin, leading to errors and missed tasks. In addition, law firms may already face challenges with time management – a key component of project management.

If a law firm hasn’t embraced legal technology, these struggles are amplified. Dealing with outdated processes and time-consuming tasks – on top of tasks like planning, budgeting, resource allocation, and budgeting – can become overwhelming quickly.

Who Manages Projects for Law Firms?

Legal project managers handle planning, efficiency, and risk management for projects. They don’t necessarily have to be lawyers, but they must possess an understanding of the specifics of the industry.

There are additional skills that legal project managers should have, including:

• Leadership skills
• Problem-solving skills
• Critical and strategic thinking skills
• Technical management skills
• Analytical skills
• Business organizational skills
• Communication skills
• Legal knowledge

How to Implement a Law Firm Project Management Strategy

Effective legal project management looks different across firms, cases, matters, and internal projects, but it has these basic components:

Set a Goal

All projects need a goal, whether it’s a marketing strategy, client case, or another internal initiative. Set a goal for what you want to achieve at the end of the project and monitor your progress along the way.

Create a Timeline

Create a timeline that includes deadlines and milestones necessary to reach your goal. If the project involves different teams, include them in the projected timeline.

Allocate Tasks

Define which teams or staff are responsible for each task or step of your plan, as well as the person responsible for the final completion of the project.

Implement Technology Tools

Law firm project management tools help improve the overall productivity and efficiency of a law firm. For example, Bill4Time’s time tracking and law firm invoicing platform also provides a task management system to evaluate each team member’s workload and plan and allocate work. Having this feature built-in allows firms to get a full view of how their staff’s time is allocated and helps them make informed decisions about which areas of the business are the most profitable.

Time tracking for lawyers also helps with legal project management by keeping tasks organized and ensuring that projects are going according to schedule. You can view upcoming, overdue, and completed tasks at a glance.

Embrace Legal Project Management

Legal project management is an important aspect of running a modern law firm. But with the right processes and systems in place, plus the right legal software that can support project management, you can reap the benefits of effective project management to keep your law firm running smoothly.

The holidays are right around the corner. If you’ve fallen behind on your holiday shopping for your legal colleagues or law firm staff, you’re in luck! Whether you forgot you’re participating in the office white elephant or need to check off the last colleague on your list, we’ve compiled a quick list of the top recommendations for last-minute gifts for lawyers.

1. Newestor Refillable Leather Journal Notebook

Practical gifts are always a good choice for a lawyer or fresh law school graduate. This refillable leather journal from Newestor is a great gift that will last for ages, thanks to the option to refill the pages. Lawyers always need to take notes for cases and clients, and this keeps them all in one place.

2. Kosdeg Hammered Copper Water Bottle

A fancy water bottle is a better choice than a plastic bottle or reusable water bottle for athletes. With upscale hammered copper, this reusable water bottle has a professional aesthetic that a lawyer can proudly keep on their desk or on the go throughout the workday.

3. LAWSUIT! Board game

If you prefer gifts with some humor, the LAWSUIT! board game presents whimsical legal scenarios and choices legal professionals make every day, such as pursuing a settlement, accepting a verdict, or opening a solo practice. If the lawyer has kids, LAWSUIT! is appropriate for kids as young as 8 years old, offering an introduction to how the justice system works.

4. Apple AirPods Pro

Apple AirPods Pro offers a wireless in-ear speaker/microphone with features like transparency mode to let outside noise in, noise cancellation, wireless charging, audio sharing, and voice commands through Siri. These are not only helpful for your lawyer to focus on, but you can personalize them with a name, initials, or phone number.

5. Justice Baseball

The Justice Baseball is a collectible baseball that’s perfect for a lawyer, law student, or judge as unique office decor. The baseball has a picture of the scales of justice on one side and the quote, “Justice, justice, thou shalt pursue” across the other side. Both images are superimposed on a painted version of the Declaration of Independence.

6. Jamie’s 15-Minute Meals

Jamie’s 15-Minute Meals is a classic cookbook for busy professionals like lawyers. Featuring Jamie Oliver’s signature style, the cookbook offers simple recipes with globally inspired recipes to make sure a busy lawyer has quick, healthy meals to throw together during a busy week.

7. My Cousin Vinny

My Cousin Vinny is a classic courtroom comedy featuring Joe Pesci and Marisa Tomei in iconic roles that are still quoted decades later. Whether your favorite lawyer has seen the movie or not, it’s an excellent nod to the legal profession.

Outlook on Lawyer Gifting

The holidays may be around the corner, but there’s still time. This list has quirky, collectible, practical, and humorous gifts to ensure you have the perfect present for your legal colleagues will use this season and beyond!