Using Rates within Litify Time & Billing

Rates are at the heart of the Time & Billing application. They assist timekeepers and billers within your organization in calculating how much is owed for time spent and cost accrued on a matter. 

This article provides an overview of rates as they are used within the Litify Time & Billing application. After reading this article you should have a much better understanding of the different types of rates, how to build or change rates, and how to enable auto-rate assignment to make using rates even easier.

Table of Contents 

Prerequisites

Users managing rates for their organization will need to be part of the Time Tracking Admin and Billing Admin permission sets. For steps on adding users to permission sets please see our dedicated article. For a comprehensive list of all Time & Billing related permission sets please see this article.

We recommend that organizations set the Time Rate object sharing to “Public Read” or “Public Read/Write.” Doing so will ensure that the changes made to rates will run properly.

Standard Rates

Standard Rates are applicable across the entire Litify platform, regardless of client or matter—these can be considered organization-wide global defaults. Standard rates are broken up into three categories: Classifications, Timekeepers, and Billing Codes

  • Classifications are groups of timekeepers. By collecting timekeepers into these groups you can streamline the rate application process by assigning one rate for multiple timekeepers who bill at a similar rate. These groups can be created via the Time & Billing Settings page.

  • Timekeepers are individuals that will be entering time entries related to matters. These rates are optional, and can be applied when a timekeeper has a more specific rate than their classification rate. While the list of timekeepers can be managed from the Time & Billing Settings page, this list is populated by users from your organization who have been added to one of the Time Tracking permission sets.

  • Billing Codes allow you to assign a rate amount and type for specific tasks and costs. They are the default rate used throughout the system whenever a timekeeper enters the corresponding billing code. These rates will generally override any classification or timekeeper rates—assuming a billing code is left on the time or cost card. These too can be created from the Time & Billing Settings page. 

Standard Rates Management

Classifications, Timekeepers, and Billing Codes each have their own dedicated space on the Rate Management page. It is from this page that you can view and modify rate information relating to each of these standard rate categories. This page can be found via the app locator at the top-left of your screen, or by clicking the Rate Management tab from the Time & Billing Settings page.

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Adding Rates

Click the name of a classification to add a rate to it. Because classifications require rates, an error message will appear next to those that do not have a rate (see image below). To add the rate, click Add Rate, enter the rate amount, select an effective date, and click Save. The effective date is the date when the rate will start to be applicable to our auto-rate assignment system. It’s important to keep in mind that the effective date cannot be used to backdate time entries or costs with a new rate.

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The process for adding a rate to a timekeeper is similar, but because timekeeper rates are optional the warning message that appears is less severe (see image below). 

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To define rates for billing codes you must first open the billing code set. Once opened you can edit the individual billing codes found within that set (see images below). 

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In addition to setting the rate amount and effective date for billing codes, you must also select the rate type. The rate type determines the method of calculation for any time or cost using the rate—see below for more information on rate types. 

Editing Rates

Update to a new active rate by selecting the classification, timekeeper, or billing code and clicking the pencil icon from the details panel. 

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In addition to changing the rate amount, you will also need to specify when this new rate will take effect. If you want the new rate to take effect immediately you can also choose “Today”. From here you can also choose to update all WIP and Pre-Bill entries assigned to this rate—by checking the corresponding box/boxes. Checking these boxes tells the system to locate all cards that are current in the WIP or Pre-Bill state, and once located swap out the old rate with the new one. We've provided these options to allow admins to quickly push changes to non-billed time entries and costs.

Remember that you can only push new rates to existing WIP/Pre-Bill line items when you are replacing a rate, not when creating rate for the first time. 

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You can also specify if you’d like the new rate to take effect on a future date. If you choose to do so there is a visual indicator that appears anywhere in the app where we display lists of rates to let you know that this rate is planned to change in the future (see image below). 

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The Time & Billing application only supports having one future rate defined at a time. Creating a new future rate will replace the old one. 

Use the History & Upcoming tab to view information about previous or upcoming rates.

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Matter/Client Rates

In addition to Standard Rates, Litify also allows for rates to be assigned specific to the client or matter. Once a client rate is configured, matters created for that client will automatically inherit that client rate. This can help save time so that you don’t have to configure specific rates individually for each matter. 

Client rates can be established by locating a client within the Litify platform, clicking on the Rates tab on the client’s Parties page, and clicking the New Rate button. From the modal that appears, choose the rate type—Time or Cost, and then enter the remaining required and optional information.

If the Rates tab does not appear on the Parties page, you may need to add it. For more information on adding the Rates tab to Parties pages please see our initial setup article.

Matter rates can also be established to override client rates when necessary. These can be especially helpful when working on a matter that is an exception to the normal way that you would bill a client. Matter rates can be configured from the Rates tab within the Client Matter Billing section of a matter. For information on setting up the Client Matter Billing component, please refer to our dedicated article.

When the system looks to apply rates to a time entry or cost, If no applicable client or matter rate is found, the system will apply the appropriate standard rate. 

Rate Selection Auto-Assignment 

Automatic rate assignment can be enabled so that when creating a time entry or cost the system automatically selects the appropriate rate. This can not only save time, but it can also prevent timekeepers and billers from accidentally selecting the wrong rate for items they’re entering.

To enable auto-rate selection, follow these steps:

  1. Navigate to the Billing Preferences section of the Time & Billing Settings page.
  2. Select the radio button next to “System selects the rate automatically after save.
  3. Have users within your organization refresh their Litify pages.

Once enabled, rates will automatically be applied to Time Entries and Cost. You can also hide the “Rates” filed from the Add Time Entry form via the Time & Billing Settings page. 

Below is an example of the Add Time Entry modal after auto-rate assignment has been enabled.

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Rate Auto-Assignment Prioritization and Error States

Once auto-rate assignment is enabled, the system will automatically apply the appropriate rate to a time entry or cost. The auto-rate application feature looks at what rates your organization has defined, and then works to apply the correct rate based on a number of factors—such as if a billing code is present, and what is the work date of the line item.

This process of automatic rate application is determined differently for time entries vs. cost.

Rate Selection for Costs

Costs require that the timekeeper or biller enter a billing code. Entering a cost billing code allows the system to check for rates from that billing code. If the matter the cost is being added to has a corresponding rate for that code, or the client, then the system will pick that rate. If no rate is found, the system will then look to the Standard rate level for an applicable billing code.

Rate Selection for Time Entries

Time Entries apply rates based on the individual timekeeper, classification, or billing code—see the Standard Rates sections above for more information regarding these rates. The system will examine which rates have been defined, and then pair this information with the work date of the time entry to determine which rate should be used.

Establishing rates at the matter or client level will tell the system when those rates should be applied. If no matter or client rates are found, the system will use the standard rates instead.

Remember that if there is a conflict, matter rates will always override client rates.

Rate Types

The Litify Time & Billing application allows you to select from one of four Rate Types. The types determine the method of calculation for the billed amount based on how your organization has determined the billing structure.. These types are explained below:

  • Hourly: Based on the amount of time worked.
    • Only available when creating Time rates. 
  • Cost: Similar to hourly. Cost rates are calculated by quantity and rate.
    • Only available when creating Cost rates. 
  • Flat: No matter how much the quantity or hours worked, the time entry or cost is always the same amount 
    • Available when creating either Time or Cost rates.
  • Fixed: A fixed rate is applied to all line items on a bill which are utilizing that rate, the rate amount is prorated across those line items once they're on a bill. 
    • Available when creating either Time or Cost rates.

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