Free calculator
Effective Hourly Rate Calculator for Attorneys | Caseledge
Calculate what you actually earn per hour worked after overhead, write-downs, and non-billable time.
Effective Hourly Rate
--Updates as you change inputs. Estimate only, not legal advice.
Your effective hourly rate is what you actually take home per hour worked, not what you put on the invoice. It accounts for unbilled time, write-downs, collection losses, and overhead that quietly erode the headline rate on your engagement letter.
This calculator divides annual collected revenue (after overhead) by total hours worked, including non-billable administrative and business development time. The result is the true economic rate of your practice, which is often 40 to 60 percent lower than the stated billing rate.
Use it to benchmark practice areas, evaluate flat-fee versus hourly work, and decide whether a rate increase or a workflow change would move the needle further.
Why use itBuilt for the way law firms actually work
True economic rate
Reveals the gap between your billed rate and what you actually keep per hour worked.
Includes non-billable time
Factors administrative work, intake, and business development that standard rate math ignores.
Overhead-adjusted output
Subtracts rent, software, staff, and insurance to show real take-home economics.
Instant results
Numbers recalculate as you type, no waiting and no exporting required.
100% free
No paywall, no email gate, and no usage caps for solo or firm attorneys.
No signup required
Use the calculator anonymously without creating an account or sharing firm data.
ProcessHow it works
- 01 Enter collected revenue
Use cash actually received last year, not billed or invoiced amounts that remain outstanding.
- 02 Add total overhead
Include rent, staff salaries, software, malpractice insurance, CLE, and bar dues for the year.
- 03 Estimate weekly hours
Separate billable client work from administrative, marketing, and firm management hours each week.
- 04 Review the result
Compare your effective rate to your stated billing rate to find leakage points.
CoverageWhat's included
- Revenue collected versus revenue billed adjustment
- Overhead deduction for true net economics
- Billable and non-billable hour separation
- Annualized output across working weeks
- Currency-formatted effective hourly rate
- Benchmark-ready number for practice area comparison
- Works for solo, small firm, and of-counsel models
ContextWhy this matters
The 2023 Clio Legal Trends Report found that solo attorneys bill an average of only 2.6 hours per workday and collect on roughly 88 percent of what they bill. That means a lawyer with a $350 stated rate often realizes closer to $150 per hour of actual work performed.
Without measuring effective rate, firms cannot tell whether a practice area is profitable, whether a flat fee is priced correctly, or whether a rate increase is warranted. Many attorneys discover their contingency or flat-fee matters out-earn their hourly book once non-billable time is counted.
Tracking this number quarterly also surfaces overhead creep. Software subscriptions, marketing spend, and staffing decisions all show up in the effective rate, which makes it a single metric that aligns pricing, staffing, and operations decisions for a US law firm.
Q&AFrequently asked
- It is the amount an attorney actually earns per hour worked, calculated by dividing net revenue by total hours including non-billable time. It is almost always lower than the stated billing rate because of write-downs, collection losses, and administrative work.
- Yes. The calculator is completely free, requires no signup, and does not store any of the figures you enter. You can use it as often as you like.
- Solo attorneys, small firm partners, and practice managers benefit most. It is especially useful when deciding whether to raise rates, drop a practice area, or move to flat-fee billing.
- A billable hour calculator tells you what to charge to hit a revenue target. This calculator tells you what you actually earned per hour after overhead and unbilled work. They answer opposite sides of the same question.
- At least once a year after closing the books, and ideally quarterly. Many firms also run it before adjusting rates or signing a long-term flat-fee engagement.
- Intake calls, conflict checks, marketing, CLE, bar admin, bookkeeping, technology setup, and any client work you wrote off. If the hour did not result in collected revenue, count it here.
- No. This tool provides a calculation based on inputs you supply. Consult a CPA or law firm consultant before making major pricing, hiring, or tax decisions based on the output.
- It varies by practice area and geography, but industry surveys suggest solo attorneys average between $100 and $200 per effective hour. Anything below your local associate salary divided by 2,000 hours is a warning sign.