By CRYSTAL JARVIS
Birmingham Business Journal

A number of law firms across the nation plan to increase their rates next year to cope with the economic downturn, according to a recently published survey.

On average, law firms project to increase their rates by 3.2 percent next year, according to the Altman Weil Flash Survey on 2010 Billing Rates.

"Although these results may seem to contradict some expectations for rate freezes in 2010, this is a relatively conservative rate increase by law firms that are struggling to balance their own business perspective with the needs of their clients," said Tom Clay, principal of Altman Weil, which provides consulting services to law firms. "Most firms are making careful, considered increases - often client by client or lawyer by lawyer - unlike prior years, when across-the-board increases were typical."

Large law firms, defined as those with more than 1,000 lawyers on staff, anticipate slightly higher increases: 4 percent, on average. Firms with 50-99 lawyers plan to raise rates about 3 percent. Among firms that plan an across-the-board increase, the average rate change will be 4.1 percent, the survey found.

"In 2009, law firms faced a constant stream of requests from clients for discounts, and that will not change in 2010. The reality is that most rates are negotiable," Clay said.

Most firms acknowledged the pressure they are under from clients to hold the line on billing rates. But they also expressed a number of reasons why rate increases were necessary or justified in their firms, Altman Weil reports. Among them: the need to raise rates after a freeze of up to two years, increases for specific practices that are under-priced compared to the market, and increases for associates and junior partners to reflect their increased experience.

The survey, conducted in November, polled 688 law firms throughout the United States with 50 or more lawyers.