How Much Should Your Law Firm Bill for Paralegal Work?
Paralegals play a critical role in delivering client value, but how much should you bill for their work? Determining the right rate can be tricky when you’re focused on fairness, profitability, and following market standards.
The Supreme Court addressed this question in Missouri v. Jenkins, where it held that legal fees can include paralegal charges at a rate that relates to the market rather than what they’re actually being paid by the attorney.
This notable ruling affirmed that paralegals aren’t just support staff whose work gets “rolled into” attorney fees. Their services have standalone value that can be billed directly to clients at market rates.
This shift is notable because it allows law firms to move away from a basic cost-recovery model. As a result, firms can delegate more work to paralegals, increase profitability, and reduce overall client costs with paralegal rates that are lower than those of attorneys.
So what does this mean for your firm in practice? To determine what your law firm should be charging, it’s important to consider the average paralegal billing rate, understand billing best practices, and review paralegal billing examples. We’ll explore each in detail below.
What Are Paralegal Billable Hours?
Not all paralegal work is considered billable. While some tasks can be billed to clients, others can’t, and it’s crucial to understand the difference. The Missouri v. Jenkins ruling described which paralegal tasks can be charged as billable hours.
Billable hours must involve substantive legal work that makes use of the paralegal’s training, education, and experience.
It’s important to note that “clerical or secretarial tasks should not be billed at a paralegal rate, regardless of who performs them.” Tasks like filing, organizing, or scheduling are considered administrative and should never be billed as paralegal time. Instead, billable hours should reflect legal tasks like research, drafting, and document preparation.
Billable Paralegal Tasks:
- Case research and discovery
- Drafting legal documents
- Court-related work and preparation
Non-Billable Paralegal Tasks:
- Scanning or copying documents
- Organizing or indexing case files
- Scheduling or confirming appointments
Tracking billable hours for paralegals has become a standard part of law firm culture, but it still leaves the question: How much should we charge? To support your charges to a client, you must be able to show you’re charging a reasonable market rate.
How to Determine the Paralegal Billing Market Rate
Multiple factors will affect the market rate you set: paralegal experience, education level, and your geographic region should all be considered. Determining the market rate may feel like guesswork, but there are two key resources you can turn to for guidance.
- Local paralegal associations may provide recent survey data for your specific area or region and may offer the most relevant data for your firm.
- National paralegal organizations like the National Association of Legal Assistants (NALA) conduct annual surveys on paralegal market rates by region and firm size.
Ideally, your firm can utilize both local and national data combined with paralegal education and experience to set a fair and reasonable market rate.
For example, a midsize law firm in Philadelphia might review local survey data and find that the average paralegal billing rate in their region is $120/hour. Using that benchmark, they could set an entry-level paralegal’s rate at $100/hour, while billing a senior paralegal with advanced certification at $140/hour.
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What is the Average Paralegal Billing Rate?
Depending on the data sources you pull from, you’ll likely see a variety of billing rate ranges. Typical paralegal billing rates fall between $100-$200 per hour, although most fall in the median of that range.
NALA data shows that compensation for paralegals has grown nationwide by an average of 6% annually. From 2022 to 2024, the industry saw a 15% increase, the largest recorded since 2002.
Complications of Charging by Billable Hours
The system of charging clients by the billable hour comes with complications. Chief among these is that it puts pressure on law firms (and by extension, their paralegals) to have as many billable hours as possible.
This scenario raises an ethical concern: paralegals could be tempted to embellish billable time or work less efficiently in an effort to increase billable hours.
Some of the professional responsibility to accurately track and manage billable time lands on paralegals themselves.
The National Federation of Paralegals (NFPA) sets out ethical considerations for paralegals, including to avoid engaging in fraudulent billing practices:
- Inflating hours billed to a client or employer
- Misrepresenting the nature of tasks performed
- Submitting fraudulent expense and disbursement documentation
But as an employer, you also have ethical responsibilities surrounding paralegals’ billable time.
According to the ABA Model Guidelines for the Utilization of Paralegal Services, Guideline 10 states that “A lawyer who employs a paralegal should facilitate the paralegal’s participation in appropriate continuing education and pro bono publico activities.”
This means it’s not enough to simply set annual billable hour requirements for paralegals, which can open the door to unethical billing practices.
Law firms also need to provide paralegals with the time and support to pursue continuing education, mentorship, and public service. Long term, this investment can enhance paralegals’ skills and increase the value of their billable work.
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Validating Charges for Client Billing Questions
It’s up to your firm to determine the correct amount to charge for paralegal time, and you should be prepared to support that decision with substantiating factors. There will always be a client who asks for a more complete explanation of their bill, and it’s well within their rights to do so.
It’s important that any fee statement details the paralegal’s qualifications and demonstrates that had the paralegal not performed the work, an attorney would have done so at a higher rate.
To provide strong client service and build trust, your bills should answer as many questions as possible upfront.
That means always including key legal billing details, like:
- The tasks performed: Provide a concise description that makes clear whether the work was legal, not clerical, in nature and relied on the paralegal’s training and experience.
- The paralegal’s qualifications: Include a brief note on the paralegal’s education and experience to show they were qualified to complete the work.
- Attorney substitution: Demonstrate that if the paralegal had not performed the task, an attorney would have done it at a higher rate.
For most clients, seeing evidence of the tasks performed and that they were performed by a qualified professional will be enough to address any questions or doubts.
For those who do still have questions, be prepared with explanations of current average paralegal billing rates in your area and where the paralegal’s skills and experience place them within the market range.
Best Practices for Paralegal Billing
In addition to getting key details onto a bill, there are other paralegal billing practices you can implement to improve client understanding and satisfaction.
1. Use Clear, Concise Descriptions
Your billing descriptions should give clients instant clarity and understanding of what they’re being billed for. Long, jargon-heavy explanations can overwhelm clients and lead to unnecessary back-and-forth or disputes. This can easily be avoided by using simple language and straightforward descriptions where paralegal hours are concerned.
2. Commit to Timely Invoicing
Make it a habit to get your invoices sent out within a month of performing services. Clients are more likely to pay a bill on time if it’s delivered promptly when the service is still fresh in their minds. Timely invoices encourage timely payments.
3. Offer Convenient, Compliant Billing
Clients find paying more convenient when firms accept online payments by credit card, ACH, or payment processors like PayPal, Venmo, and PayPal Pay Later. To stay compliant, especially when trust accounts are involved, it’s critical to use a legal-specific payment processor like CosmoLexPay.
For paralegals who prepare or review billing statements, these legal platforms allow invoices to be finalized faster with real-time payment tracking and compliant client and firm accounts that stand up to scrutiny.
Paralegal Billing Entry Examples
What do paralegal billing entries look like in practice? Consider these paralegal billing entry examples that follow the best practices guidelines covered above.
Example 1: Legal Research
Entry: Conducted legal research on recent case law regarding admissibility of expert testimony; prepared summary for attorney review (2.0 hours).
Why this works: The description is clear, shows the work was legal in nature (research and summary), and makes it obvious that if the paralegal hadn’t done the task, an attorney would have done so at a higher rate.
Example 2: Document Drafting
Entry: Drafted initial discovery requests, including interrogatories and requests for production, for attorney approval (3.5 hours).
Why this works: The entry specifies the task (drafting discovery requests), demonstrates legal knowledge and training, and ties it directly to attorney-level work that can be delegated appropriately.
Example 3: Client Communication
Entry: Conducted client intake interview to gather case facts and drafted summary memorandum for attorney review (1.5 hours).
Why this works: The entry identifies a substantive, legal-related task (fact gathering and memo drafting), shows the paralegal’s education and training were applied, and indicates how the paralegal’s work saved the client from paying for additional attorney hours.
Billing Paralegal Work the Right Way
Billing for paralegal work requires accuracy, clarity, and compliance, from setting market-based rates to drafting detailed billing entries that clients can trust. Capturing and billing for paralegal work is simple with CosmoLex legal practice management software, built to support every role across your firm.
CosmoLex gives attorneys and support staff integrated, easy-to-use features for time and billing, payments, and trust accounting. With every function in one platform, your firm can streamline workflows, improve profitability, and deliver the transparency clients expect.
See how a true end-to-end solution makes managing your practice easier. Schedule a free demo with the CosmoLex team now.
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