When billing Fixed Fee work, LeanLaw still needs a way to allocate revenue internally—by user and attorney—for reporting, billables, and compensation insights. Revenue allocation methods determine how a fixed fee is split across contributors, even though the client sees only a single flat amount.
This article explains the three allocation methods available in LeanLaw, when to use each, and how they impact reporting.
What Is Fixed Fee Revenue Allocation?
Fixed fee revenue allocation controls how the total fixed fee amount is distributed internally across users who worked on the matter. Allocation affects:
Billables by user
Compensation reporting
Worked amount calculations
Allocation does not change the invoice total sent to the client.
Available Allocation Methods
LeanLaw supports three allocation methods for fixed fees:
Percentage-Based Allocation
Worked Amount Allocation
Worked Hours Allocation
Each method answers a different question about how revenue should be attributed.
Percentage-Based Allocation
What It Is
Revenue is split based on predefined percentages assigned to users or attorneys.
When to Use It
You want predictable, agreed-upon revenue splits
Time or rates should not influence allocation
Partners or attorneys have fixed ownership of the work
Key Rules
Percentages must total 100%
Allocation is not affected by time entries or rates
Example
A $10,000 fixed fee is split:
Attorney A: 60% ($6,000)
Attorney B: 40% ($4,000)
Worked Amount Allocation
What It Is
Revenue is allocated based on the worked dollar amount of Fixed Fee time entries. Time entries are valued using each user's rate, then the fixed fee is distributed proportionally.
When to Use It
Rates vary significantly by user
You want revenue attribution to reflect cost or seniority
Compensation depends on the value of work performed
Example: Same Hours, Different Rates
Attorney A: 5 hours at $400/hr → $2,000 worked amount
Attorney B: 5 hours at $200/hr → $1,000 worked amount
Total worked amount = $3,000
For a $6,000 fixed fee:
Attorney A receives 66.7% ($4,000)
Attorney B receives 33.3% ($2,000)
Worked Hours Allocation
What It Is
Revenue is allocated based solely on the number of hours worked, regardless of rate.
When to Use It
All contributors should be weighted equally by time
Rates should not affect revenue distribution
You want a simpler, time-based approach
Example: Same Hours, Different Rates
Attorney A: 5 hours
Attorney B: 5 hours
Each attorney receives 50% of the fixed fee, even if their hourly rates differ.
Important Rules & Edge Cases
Percentages Must Total 100%
For percentage-based allocation, LeanLaw requires allocations to total exactly 100%. If they do not, revenue cannot be distributed correctly.
Invoice User or Responsible Attorney Is Blank
If the invoice user or responsible attorney is not set:
Allocation may default or fail depending on firm settings
Revenue may not appear as expected in reports
Best practice: Always ensure the responsible attorney or invoice user is set before finalizing billing.
What Allocation Impacts
Revenue allocation affects several internal reports:
Billables by User
Allocation determines how much fixed fee revenue appears under each user's billables.
Compensation Reports
Fixed fee revenue contributes to compensation as a worked amount component, based on the selected allocation method.
This ensures compensation reflects how work was performed—not just how it was billed.
In Summary
Fixed fee revenue allocation in LeanLaw gives firms flexibility in how internal credit is assigned, without changing what the client pays. By choosing the right allocation method—percentage, worked amount, or worked hours—you can align reporting and compensation with how your firm actually operates.