Artificial intelligence is now used by almost 90 per cent of legal professionals in the United Kingdom and Ireland, and it is placing one of the profession’s oldest conventions the billable hour under the microscope.
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According to the legal software company Clio’s U.K. & Ireland Legal Insights Report 2026, among firms using AI:
- almost 80 per cent said they can handle more work without increasing resources; and
- over 70 per cent said it cut costs by absorbing administrative work once done by support staff.
The report found that AI is challenging assumptions on which the legal profession was built, forcing firms to reassess how their lawyers spend their time, how they charge for it, and how new lawyers learn the ropes.
Some of the United Kingdom’s largest firms have moved into practice.
A&O Shearman has worked with the legal AI company Harvey to develop artificial intelligence agents for tasks including reviewing loan agreements and analysing regulatory filings work the firm says can be completed in minutes where it previously took several hours.
Slaughter and May has rolled out Harvey across all practice areas this year, including for regulatory research and document analysis.
The billable hour is central to the business model of many law firms. When AI significantly reduces the time lawyers spend sifting through and drafting documents, the economics are no longer straightforward.
Nick Rowles-Davies, founder and chief executive of the London- and Dubai-based legal finance fund Lexolent, told CNBC:
“You can’t charge 16 hours for something that takes 16 seconds.”
Clio’s report found that about one in five firms that have widely adopted AI report difficulty meeting billable-hour targets. Globally, according to a Deloitte survey, senior legal leaders expect the share of work charged by the hour to fall from 72 per cent to 44 per cent over the next two to three years.
Routine work is the most exposed, Mr Rowles-Davies said:
“If you’ve got standard documents and you’re just putting in detail, then clearly that’s an automatic process.”
Complex legal work, he added, still requires human judgment — particularly in interpreting AI output and determining the right strategy for a client.
He also warned that lawyers must be able to spot AI hallucinations:
“There have been a lot of cases where lawyers have been sanctioned for producing briefs before a court with cases that don’t exist.”
Mansoor Soomro, who leads the Future of Work Research Unit at Teesside University in Middlesbrough, England, told CNBC that the billable hour is certainly not disappearing overnight, but that it is getting harder to justify.
Mr Soomro said AI is also changing how lawyers learn their trade, because the repetitive tasks it absorbs are the tasks that traditionally taught junior lawyers the building blocks of law. Reviewing hundreds of documents taught them what matters; writing up contracts honed their drafting; researching dozens of cases developed their legal reasoning.
As AI takes on more of that work, firms will need to be deliberate about replacing those learning opportunities, said Jorge Bestard, London-based head of EMEA at Harvey:
“A faster route to a draft does not automatically mean a faster route to competence.”
Francesca Bennetts, A&O Shearman’s London-based head of legal talent, said the firm is placing more value on “curiosity and entrepreneurship”, and is building career paths in legal engineering, product and AI delivery that “barely existed a few years ago”.
“The need to develop exceptional lawyers doesn’t go away. They are the partners and experts of the future.”
Mr Soomro expects judgment to become “disproportionately valuable”, with lawyers spending more time checking and challenging AI’s output and interpreting what it means for a client.
“The future may therefore not belong to the lawyer who knows the most about one narrow area, but to the lawyer who knows how to connect multiple areas to solve a complex client problem.”
Whether AI efficiencies ultimately make lawyers’ working lives better may depend on what firms do with the time they recover.
Clio’s report found that 51 per cent of legal professionals work evenings but only 32 per cent want to, and 22 per cent work weekends compared with 11 per cent who would choose to.
Joshua Lenon, Clio’s New York-based lawyer-in-residence, believes some lawyers are already seeing the benefits:
“Lawyers [are] telling us that their day is getting better. People are really looking at these tools and saying, ‘This is making work better.'”
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