Hourly billing remains dominant among small, midsize firms, new 8am data shows
Hourly billing is significantly outpacing flat fee arrangements at small and midsize law firms, despite widespread predictions about the death of the billable hour, according to new data from professional business platform 8am. (Image from Shutterstock)
Hourly billing is significantly outpacing flat fee arrangements at small and midsize law firms, despite widespread predictions about the death of the billable hour, according to new data from professional business platform 8am.
The 8am SMB Law Billing and Payments Report, which was released Thursday, shows that 48% of these firms bill entirely by the hour, while only 10% exclusively use flat fees. The remaining 42% reportedly use a combination of hourly billing and flat fee arrangements.
“All too often, firms are making consequential decisions about how they bill and receive payments without real benchmarks to measure against,” said Tanya Hendricks, the chief product officer at 8am, in a news release. “Flat fee trends are a prime example—the industry narrative suggests many are moving in that direction, but our data shows most SMB firms have not.”
8am’s report, which analyzes billing and payment trends for the first half of 2026, also shows that small and midsize firms billed more but not because of higher hourly rates. Hourly rates remained unchanged across all firm sizes except midsize firms, and their hours spent per case remained mostly flat. However, what small and midsize firms earned per hour billed increased between 3% and 5%, while their total billings increased between 5% and 8% each month.
“With rates and hours being relatively flat, the driver for change was an improvement in how much recorded time made it onto an invoice,” according to the report.
Among 8am’s other key findings, small and midsize firms have slightly improved collections. Nearly 60% of firms had more invoices paid in full, compared to 58% the prior year. Meanwhile, 26% had fewer invoices go past due, compared to 27% last year.
“The picture that is emerging is one of firms getting more disciplined: getting paid more reliably, billing more of what they’ve already earned, and making more deliberate choices about how they get paid,” Hendricks also said.
The SMB Law Billing and Payments Report is based on billing and payment data from more than 60,000 firms that use 8am’s MyCase and LawPay platforms.
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