Boonchai Wedmakawand | Moment | Getty ImagesArtificial intelligence is now used by almost 90% of legal professionals in the UK and Ireland, and is putting one of the profession’s oldest conventions, the billable hour, under the microscope. This is according to the Legal Insights Report 2026 from legal software company Clio. It found that among companies using AI, nearly 80% said they can handle more work without increasing resources, while more than 70% said it reduced costs by absorbing administrative work previously done by support. staff. As a result, AI is challenging some of the assumptions on which the legal profession was built, forcing firms to reevaluate how their lawyers spend their time, how they charge for it, and how new lawyers learn the ins and outs. You can’t charge 16 hours for something that takes 16 seconds Nick Rowles-DaviesLexolent Some of the UK’s biggest firms are already putting this into practice. A&O Shearman has worked with legal AI firm Harvey to develop AI agents for tasks, including reviewing loan agreements and analyzing regulatory filings, which it says can complete in minutes work that previously took several hours. Meanwhile, Slaughter and May have implemented Harvey across all practice areas this year, including regulatory research and document analysis. Billable hour pressure The billable hour is central to many law firms’ business model, but when AI significantly reduces the time lawyers spend reviewing and drafting documents, the economics are no longer so simple. “You can’t charge 16 hours for something that takes 16 seconds,” Nick Rowles-Davies, founder and CEO of legal finance fund Lexolent, based in London and Dubai, told CNBC. About one in five companies that have widely adopted AI report difficulty meeting billable hour goals, according to the Clio report. Globally, senior legal leaders expect the share of work charged by the hour to fall from 72% to 44% in the next two to three years, according to a Deloitte survey. Routine work is the most exposed, Rowles-Davies said. “If you have standard documents and you’re just putting them into detail, then clearly it’s an automatic process.” But complex legal work still requires human judgment, he added, particularly when interpreting AI results and determining the right strategy for a client. Lawyers [are] telling us that your day is getting better. Lawyers must also be able to detect AI hallucinations. “There have been many cases where lawyers have been sanctioned for filing briefs in court with cases that do not exist,” Rowles-Davies said. Mansoor Soomro, who heads the Future of Work Research Unit at Teesside University in Middlesbrough, England, told CNBC that the billable hour certainly doesn’t disappear overnight, but it is increasingly difficult to justify. Training young lawyersAI is also changing the way lawyers learn their craft, Soomro added, as repetitive tasks traditionally helped young lawyers learn the fundamentals of law. Reviewing hundreds of documents taught them what matters, drafting contracts honed their drafting skills, and researching dozens of cases helped them develop legal reasoning, he added. Wera Rodsawang | Moment | Getty Images As AI takes on more of that work, companies will need to take deliberate steps to replace those learning opportunities, according to Jorge Bestard, EMEA director at London-based Harvey. “A faster path to a draft doesn’t automatically mean a faster path to competition,” he told CNBC. A&O Shearman is placing more value on “curiosity and entrepreneurship,” said Francesca Bennetts, director of legal talent at the London-based firm. He’s also building career paths in legal engineering, AI products and delivery that “barely existed a few years ago,” he told CNBC. “The need to develop exceptional attorneys does not go away,” Bennetts said. “They are the partners and experts of the future.” Soomro expects trial to become “disproportionately valuable” in the sector, with lawyers spending more time verifying and challenging AI results and interpreting what it means for a client. “Therefore, the future may not belong to the lawyer who knows the most about a specific area, but to the lawyer who knows how to connect multiple areas to solve a complex client problem,” he said. It will depend on what companies do with the time they return. The Clio report found that 51% of legal professionals work in the evenings, but only 32% want to do so, while 22% work at weekends compared to 11% who would choose to do so. Joshua Lenon, resident attorney at Clio based in New York, believes some attorneys are already seeing the benefits.”Lawyers [are] “People really look at these tools and say, ‘This is making work better.'”
