How AI is changing lawyers, billable hours and legal careers

Artificial intelligence is now used by almost 90% of legal professionals in the UK and Ireland, and it is putting under the microscope one of the oldest conventions of the profession – the billable hour.

That’s according to the 2026 UK and Ireland Legal Insights Report from legal software company Clio. It found that among companies using AI, almost 80% said they could handle more work without increasing resources, while more than 70% said they were reducing costs by absorbing administrative work formerly done by support staff.

As a result, AI is challenging some of the assumptions on which the legal profession has been built, forcing firms to re-evaluate how their lawyers spend their time, how they bill for it, and how new lawyers learn the ropes.

Some of the UK’s biggest companies are already putting this into practice. A&O Shearman has worked with legal AI firm Harvey to develop artificial intelligence agents for tasks such as reviewing loan agreements and analyzing regulatory filings, which it says can accomplish in minutes work that previously took several hours. Slaughter and May, meanwhile, deployed Harvey across all practice areas this year, including regulatory research and document analysis.

The billable hour is central to the business model of many law firms, but when AI dramatically 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.

According to Clio’s report, approximately one in five companies that have widely adopted AI report having difficulty meeting their billable hours goals. Globally, top legal executives expect the share of work billed by the hour to fall from 72% to 44% over the next two to three years, according to a Deloitte survey.

Routine work is most at risk, Rowles-Davies said. “If you have standard documents and you just detail them, it’s clearly an automatic process.”

But complex legal work still requires human judgment, he added, especially when it comes to interpreting AI results and determining the right strategy for a client.

Lawyers must also be able to spot AI hallucinations. “There have been many cases where lawyers have been sanctioned for producing submissions to court about cases that did not exist,” Rowles-Davies said.

Mansoor Soomro, who leads the Future of Work research unit at Teesside University in Middlesbrough, England, told CNBC that billable hours certainly wouldn’t disappear overnight, but they were becoming increasingly difficult to justify.

AI is also changing the way lawyers learn their craft, Soomro added, as repetitive tasks traditionally helped young lawyers learn the building blocks 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.

As AI takes on an increasing share of this work, companies will need to think about replacing these learning opportunities, according to London-based Jorge Bestard, head of EMEA at Harvey. “A faster path to a draft does not automatically mean a faster path to proficiency,” he told CNBC.

A&O Shearman places more value on “curiosity and entrepreneurship,” said Francesca Bennetts, the London-based firm’s head of legal talent. It’s also creating career paths in legal engineering, product delivery and AI that “barely existed a few years ago,” she told CNBC.

“The need to develop exceptional lawyers is not going away,” Bennetts said. “They are the partners and experts of the future.”

Soomro expects judgment to become “disproportionately valuable” in the industry, with lawyers spending more time verifying and disputing AI results and interpreting what they mean for a client.

“So the future may not belong to the lawyer who knows a specific area best, but to the lawyer who knows how to connect multiple areas to solve a client’s complex problem,” he said.

Whether the effectiveness of AI will improve lawyers’ working lives may depend on what firms do with the time they return. The Clio report reveals that 51% of legal professionals work evenings, but only 32% want to, while 22% work weekends, compared to 11% who would like to. Joshua Lenon, Clio’s New York-based attorney-in-residence, believes some attorneys are already seeing the benefits.

“Lawyers tell us their day is getting better,” Lenon told CNBC, as AI becomes more common. “People really look at these tools and say, ‘This makes work better.'”