For years, lobbyists working at law firms have, by and large, billed clients the same way lawyers do: by tracking their time in six-, 12- or 15-minute intervals, also known as the billable hour.
Now, one of the District’s most lucrative lobbying shops — the public policy group of the law firm Holland & Knight — is taking a step away from that tradition-bound model.
Starting Jan. 1, the firm will charge a fee based on the going market rates, plus an estimate of how many hours the firm would spend on the account. Lobbyists, however, will no longer have to keep track of their time.
Under the hourly billing system, “it’s difficult to justify hanging around the Hill for three or four hours unless you’re there for specific meetings you can bill to the client,” said Rich Gold, head of Holland & Knight’s public policy and regulation group. “Sometimes the most productive time is spent walking around people’s offices figuring out what’s going on.”
Independent lobbying shops typically charge retainers, and lobbyists don’t have timekeeping requirements, making it easier to recruit talent.
“Because the clients are paying for particular services, they’re not signing up for a group of attorneys to be working for them at a particular rate,” Gold said. “They’re just signing up for consulting on policy issues related to X, Y and Z. Most clients don’t care if someone is keeping time or not.”
Holland & Knight’s move, approved by law firm management last week, comes as others have been shifting away from hourly charges. Bracewell & Giuliani, a Texas-based law firm whose lobbying practice last month broke off into a separate business unit called the Policy Resolution Group, got rid of the billable hour for two-thirds of its clients at the beginning of this year, said Scott Segal, director of the Policy Resolution Group.
Holland & Knight is the first national law firm to do away with the billable hour framework for a major practice group, Gold said. The shift, which will affect about 200 client matters going forward, is also being closely watched because Holland & Knight is among K Street’s top-earners, this year raking in $13.9 million in lobbying revenue. Other major law firms’ lobbying practices may follow suit, said Ivan Adler, a headhunter for lawyers and lobbyists at the McCormick Group.
“I think it’s a groundbreaking thing,” Adler said.