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Flat Fee Billing in the Age of Automation: A Cost-Effective Model for Agreements
- The Divii Team
- Aug 21
- 6 min read
Updated: 4 days ago
Clients want transparency. Lawyers want scalable options. Flat rate billing delivers both – with help from smart legal tech.
Modernizing Legal Billing For Family Lawyers
For years, family lawyers have relied on the billable hour to price separation agreements. But with the rise of legal automation tools, flat rate billing offers an alternative that can improve law firm efficiency and profitability.
A survey conducted by Canadian Lawyer Magazine in the spring of 2024 showed that around 65% of law firms across all practice areas in Canada are using a flat fee structure, while around 74% of lawyers use blended rates, which means they combine both flat fee and hourly billing models. With the rise of new tools and technology, these rates are likely to increase. The discussion around moving away from the billable hour and towards flat rate services has never been more relevant.
What is Flat Fee Billing for Legal Services:
Flat fee billing is a payment model where a legal professional charges a single, set price for a specific legal service – regardless of the time or effort involved. Instead of paying per billable hour, clients pay one fixed amount upfront or upon completion.
It’s time for the billing model to evolve with legal tech
According to Clio’s Key Insights on Flat Rate Billing in their 2024 Legal Trends Report (U.S. data)*, three-quarters of billable revenue could be replaced with the rise of automation and AI. This prediction means family law firms will have to adapt in order to both operate and continue to scale.
But as Clio’s report also points out, as AI takes over a large majority of work that is billed hourly, revenue will decline. This is where a fair flat rate services makes sense. Family lawyers can charge for their legal expertise, separation agreements, and divorce filings, and other services while providing predictability for their clients. In this case, it makes more sense to charge not by 6 minute increments, but by value delivered.
From a business standpoint, it’s much harder to scale a family law practice when tasks are not optimized with modern automation tools that allow you to minimize hours spent on tedious, repetitive tasks and spend more time where expertise can be better valued.
*This article looks at a combination of data insights from both Canada and the U.S.
The Billable Hour Model Increases Admin and Delayed Payments
Clio’s Report also notes that firms are over five times more likely to send bills out to clients right away, than firms who charge an hourly rate. The amount of tracking and admin for billing hourly is time consuming and adds to administrative costs.
Even more encouraging, is that the report shows that lawyers who charge a flat fee are nearly twice as likely to collect immediate payments than those who charge a billable hour. Clio’s data also highlights that clients are more likely to pay faster with flat fee billing because transparency and understanding have been established around legal fees and the work being done.
Flat rate pricing builds trust through transparency and sets clear communication about billing from the start. Fair, direct pricing communicates this transparency.
Clients Want a Flat Rate & Better Turn-Around Times
Hourly billing can appear to reward inefficiency rather than focus on results. This lack of cost transparency can cause friction in client relationships, damage trust, and make your services feel inaccessible.
Clio’s 2024 trend report also shows that 71% of potential clients would prefer to pay their lawyers a flat fee for their entire case, and around 51% would like to pay a flat fee for specific tasks in their case.
As a client-centred law firm, lawyers should provide clear communication around billing for their clients. Many clients have had a bad experience with billing in the past, with lawyers charging high billable hours with no results. Clio's report notes that those who have experience hiring a lawyer in the past have a higher preference to pay flat fees than those who don't have experience working with a lawyer, possibly do to negative experiences with traditional payment models.
Flat rate pricing builds trust through transparency and sets clear communication about billing from the start. Fair, direct pricing communicates this transparency.
Why Flat Rate Billing Works Better for Separation Agreements
Flat fee billing gives lawyers more control over their time without the fear of automation tools reducing their income. In reality, flat fees combined with a systemized-tool like Divii, can help lawyers do more in less time without sacrificing the value of their legal expertise.
The majority of separation agreement drafting is process-consistent and automation allows legal professionals to create a solid agreement in less time, while still maintaining a reasonable fee structure for their practice that leaves room for growth.
How Legal Automation Tools Power Flat Fee Billing
With flat rate billing, you can allow automated family law tools to maximize your efficiency. Less hours at the office paired with flat rate pricing makes the most sense for a lawyer who wants to take control of their time so they can spend more time with more clients, take on more cases, or just arrive at home in time for dinner.
With fixed rate pricing, lawyers are no longer chained to the clock. Legal professionals can improve turn-around times and still scale.
For example, a family lawyer can spend 6-8 hours drafting separation agreements manually from old (and sometimes outdated precedents), OR they can spend 1-2 hours** drafting an agreement with automation. A separation agreement automation system like Divii dramatically cuts drafting time while ensuring accuracy, efficiency, and clarity for clients.
Here’s a calculator that can illustrate how a lawyer can scale with automation:
Lawyers will be able to stop the email-phone tag game that plagues time-deficient legal professionals, and have more time available for clients to address their concerns and ease their worries.
*On average with Divii
Common objections to the flat rate billing model
“But every client is different.” Most agreements actually follow predictable patterns and are process-consistent, and Divii can take over this process for family lawyers, allowing them to customize where needed, while automating the drafting tasks they repeat each time.
Flat rates undercut the value of my work.” When supported by time-saving tools that increase the value of legal services, lawyers can focus on providing their client with advice and guidance, not on completing tedious tasks. Using a platform like Divii, lawyers make sure they are using the best tools to showcase their expertise.
“I make more on the billable hour.” You’ll only ‘make more’ on the billable hour if you ignore the hidden costs – wasted time, client friction, and the lost opportunities that come with slower case turnover. Clio’s 2024 Legal Trends Report shows that hourly-billed matters take 2.6 times longer to close than flat-fee matters. That means with a flat-fee model, you can handle significantly more cases in the same time frame.
Automation lets you deliver the same quality work in less time and if you then charge a fair flat fee for that work, you win twice: your clients are happier because their matter is resolved faster (happier clients often mean more referrals), and you free up capacity to serve more clients. Efficiency isn’t just an internal gain, it’s a reflection of your practice’s ability to deliver results smoothly, professionally, and at scale.
The Business Case for Switching
Predictable revenue and pricing structures.
Ability to serve more clients without working more hours.
Competitive advantage in a modern, client-focused legal market.
Alignment with expectations of modern, tech-savvy clients.
Easier client onboarding and conversion.
Time savings without sacrificing service quality.
Conclusion: The Future is Flat Rate
Clients have high standards and expect transparency, efficiency, and clear guidance – especially during their separation. Flat rate billing, supported by automated family law software systems like Divii for Lawyers, delivers those expectations. Lawyers who adapt early gain a competitive edge.
Ready to say goodbye to the billable hour and automate the separation agreement process designed to make flat rate billing easy and profitable? Schedule a demo or start your free trial.
Book a demo or start your free trial and begin improving your family law practice.
