Tips for Billing Clients

Under whatever billing system you operate, there will come a time when you have to send a bill to a client. (Even on contingency cases, I send a bill to the client when I incur costs. I may not collect money from the client, but I do have an obligation to keep them informed of costs incurred, since the ultimate responsibility is the client's.) Here are some tips for sending bills to clients that will hopefully maximize your recovery with as little effort as possible:

1. Every bill should be reviewed by a lawyer before sending it out to the client. If you end up in a fee dispute, you want to be able to argue that the bill was reviewed and approved by an attorney, and not just by staff.
2. Place your EIN on every bill. This will make your life easier on clients when it is time to send you payment. If they have all of the information that they need in front of them, they can get to the business of paying you and not searching for information.
3. Send a bill to clients at least monthly. On an hourly case, even if you did no work, you should send a bill to the client. This is especially true if there is an outstanding balance. On contingency cases, I only send a bill to the client if I have incurred costs that month. On flat rate cases, I send the bill monthly showing how much work was done. Keeping clients up to date will make them more willing to pay you.
4. On large cases, or cases that take up a lot of time, you may want to consider sending out bills more frequently. If you are going to do this, let the client know before you do it.
5. Make sure you have a system for tracking client costs. All receipts go into the file and it gets marked down in the computer. Thus, I can show where I charged the client for it, and I can show what the exact cost was for, and when the vendor was paid.
6. Make sure everyone in the firm knows the billing policies. Are you going to bill for photocopies and faxes? (I do not, but that sounds like another post.) Are you going to bill for online research? (Probably another post there, as well.) If someone other than an attorney is going to be making copies or sending faxes, they must know your policy.
7. Keep copies of time records and bills. If you are in a fee dispute in the future, it may be persuasive if you have copies of the documents you used to create your bill.
8. If a client is overdue, call them personally. Here is where I disagree with others. I believe that the person whose name is on the letterhead should be making the call. Do not have a staff person call. Call yourself. It is your money, it is your client, it is your responsibility. Maybe there is a problem that the client is having. Maybe the client misplaced the bill. Maybe the client is unhappy. If the client is having a problem or unhappy, this gives you a chance to either market to the client or fix a problem, and keep the client. Your staff cannot do this. The client will be much more impressed with a personal phone call.
9. Be prepared to stop working for a client who does not pay you. Once the client becomes delinquent, and you have personally attempted to collect the money, stop working. I have a clause in my fee agreement that allows me to do this. Sometimes you may need a court order. But, the client cannot get your services for free. And if you do not value your services enough to stop working, the client will not value your services either!
10. Either offer a discount for early payment or add a late fee for late payment. Either method will encourage the client to pay you on or before the due date.

These ten steps are not going to guarantee a payment for every client on every bill. But they are a way to continue to establish rapport with a client. This will make the client more likely to pay you timely.

------ Jonathan