UK legal industry to raise fees and work longer hours in 2023

Legal Trends Report 2022

Research finds UK law firms concerned by rising costs and inflation, expect impact to profitability in the year ahead

Amid a looming recession and rising inflation, 64% of UK law firms are planning to raise fees in 2023, according to a new survey of legal professionals. The research, conducted by Clio, the world’s leader in cloud-based legal technology, also found that 67% of legal professionals are still working longer hours than before the Covid-19 pandemic, despite saying they had more ‘flexible’ working arrangements.

Clio conducted this research to complement the release of its latest Legal Trends Report, a substantial study of the working lives and legal trends among U.S. lawyers, to highlight the impact that a worsening economy is having within the UK specifically– both on individual lawyers and firms as a whole. 

Seven in ten UK lawyers (68%) feel that they have a better work-life balance than before the pandemic. However, almost the same number (67%) also report working longer hours due to flexible working and working-from-home arrangements, according to Clio’s research. This reinforces the results of the 2022 Legal Trends Report, which highlighted the challenges felt within different territories and revealed that 86% of lawyers say they still work outside the nine-to-five working day, 74% work “after hours,” and 69% communicate with clients on weekends.

Half of UK law firms (50%) expect rising costs and inflation to impact their profitability in 2023. Analysis in Clio’s 2022 Legal Trends Report suggests that lawyers’ fees are currently approximately 3% behind inflation. To secure cash flow, law firms’ top three focuses for the year ahead are improving efficiencies in their current model (33%), securing new business (32%), and looking for new tech to help improve practices (29%). 

Commenting on the new research, Alistair Wells, Co-founder & Director at UK law firm Tend Legal, said: “The current economic situation presents great opportunity in the market. With fees of traditional law firms rising, as they seek to stay on top of the ongoing salary wars, clients are starting to look for alternative options for legal advice. This makes way for smaller, leaner and more agile firms that offer excellent, client-focused service at a better price-point. As a result, I expect that we will see a lot of these smaller law firms increasingly taking work from the much larger players.”

Almost all UK law firms (95%) expect tech to play a key role in helping their business remain profitable in 2023. However, there are still barriers to technological transformation – the most common issues are price (52%), training expectations (47%), and time (40%). 

Sarah Murphy, General Manager at Clio EMEA, comments: “We’re at a crucial time for the industry. The uncertainty and pressures within the economy are hitting everyone and we felt it was important to understand how that could impact daily working life.

“While it’s great news that legal professionals have more flexibility in their working arrangements, it’s essential that they maintain a positive work-life balance. Overworking is still overworking, even if you’re at home and have flexible hours. One important part of reducing the workload is leveraging technology, and it’s reassuring to see that the vast majority of UK law firms agree. 

“In addition to greater flexibility and job satisfaction, cloud software also offers significant business benefits. Our data shows that law firms that use cloud-based legal practice management software to manage their business are 60% more likely to have positive relationships with their clients than those that don’t.” 

Alistair continued: “It’s no surprise that technology is becoming more commonplace within the legal sector. We use tech to enhance client experience, ensure that our administrative processes are efficient and cost-effective, and to maximise profitability. We work closely with Clio for our cloud-based case management and other suppliers to help with additional services, but we are exploring how we could adopt AI tools, such as ChatGPT, and how it could support legal work.”

Clio is transforming the legal experience for all by creating the world’s leading cloud-based technologies for law firms—to keep lawyers and their clients better connected throughout the legal process.

The Legal Trends Report is available to download here.


For more information, please contact Zoe Hamlyn or Olivia Prole at Definition 

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