No-Charge Time Entries: Boost Client Trust & ROI

Quick Summary

• Strategic transparency: Recording no-charge time entries on client invoices demonstrates value and builds trust, with firms reporting 15-20% better client retention when showing goodwill work • Proper categorization is crucial: Use distinct billing codes for no-charge work to track productivity accurately while ensuring these entries display correctly on invoices without fees • Technology makes it simple: Modern billing software automates the process of including no-charge entries on invoices while maintaining accurate internal reporting for productivity and profitability analysis

Every mid-sized law firm faces this scenario: Your senior partner just spent an hour advising a long-term client on a quick question. You want to show the client you’re working for them, but you also want to maintain goodwill by not charging for every minute. The question isn’t whether to write off the time—it’s how to record it so the client knows you’re investing in their success.

Here’s what most firms get wrong: they either don’t track no-charge time at all (losing valuable productivity data) or they track it but never show it to clients (missing a powerful relationship-building opportunity). Research shows that clients appreciate it when they find out their lawyers are working for them without billing them for every single minute.

Let’s dive into how to properly record, track, and display no-charge entries in a way that benefits both your firm and your clients.

The Hidden Value of No-Charge Time Entries

Before we get into the mechanics, let’s address why this matters more than ever in 2025. With law firm billing rates increasing by 10% in 2024—more than double the previous year’s increase—and expectations of 6%+ growth continuing into 2025, clients are more fee-conscious than ever.

Showing no-charge work accomplishes three critical goals:

1. Building Client Trust and Loyalty

When clients see “no charge” entries on their invoices, they understand you’re not nickel-and-diming them. As one attorney noted, having clients who are “happy” with their bills, happy to see that they are not getting billed if they send an email asking for an update, happy to pay the time entries that actually are billed—that is a sacrifice worth making.

2. Maintaining Accurate Productivity Metrics

TimeSolv recommends that timekeepers track all their time for the day, whether that time is billable or not, as this will allow the firm to see how much time may be spent on non-billable tasks and provide good data on how to allocate resources within the firm.

3. Demonstrating Value During Fee Discussions

When it comes time for rate increases or scope expansions, having a documented history of goodwill work strengthens your negotiating position. Clients can see the full value you’ve been providing, not just what appeared on past invoices.

Understanding the Three Types of Time Entries

Not all unbilled time is created equal. Understanding the distinctions is crucial for proper recording and reporting:

Billable Time

Standard entries that appear on invoices with associated fees. This is your bread and butter—the work that directly generates revenue.

Non-Billable Time

Non-billable entries will NOT appear on client invoices. This includes internal meetings, administrative tasks, business development, and CLE activities. These entries are tracked for internal productivity analysis but never shown to clients.

No-Charge Time

If you’d like to make a time entry that’s not billed to a client appear on their invoice, choose No Charge. The entry will then be included on the invoice and in the amount column will appear “No Charge” so it’s clear to the client that this activity done by your firm was at no cost to them.

Setting Up Your Billing System for No-Charge Entries

The key to successfully implementing no-charge entries lies in proper system configuration. Here’s your step-by-step guide:

Step 1: Create Distinct Billing Codes

Establish specific activity codes for different types of no-charge work:

NCPH: No-charge phone calls
NCEM: No-charge emails
NCREV: No-charge document review
NCADV: No-charge strategic advice
NCRES: No-charge research

Having granular codes helps you analyze which types of goodwill work you’re providing most often and to which clients.

Step 2: Configure Invoice Display Settings

Ensure your billing software is set to:

Include no-charge entries in the time entry section
Display “$0.00” or “No Charge” in the amount column
Show the actual time spent (this is crucial for demonstrating value)
Include full descriptions of the work performed

Step 3: Establish Clear Guidelines

Create written policies about when to use no-charge entries versus write-offs:

Use No-Charge Entries For:

Quick client questions (under 15 minutes)
Relationship-building conversations
Minor administrative corrections
Follow-up clarifications on completed work
Strategic advice for valued long-term clients

Use Write-Offs For:

Inefficient work that took longer than it should have
Training time for new associates
Work that exceeds agreed-upon estimates
Corrections to firm errors

Step 4: Train Your Team

Firms report 10-20% improvements in realization rates with proper training. Ensure everyone understands:

The difference between non-billable and no-charge time
When to use each billing code
How to write descriptive entries that showcase value
The importance of contemporaneous time tracking

Best Practices for Recording No-Charge Entries

1. Be Specific and Descriptive

Don’t just write “Phone call - no charge.” Instead, use entries like:

“Strategic discussion regarding upcoming merger considerations (no charge)”
“Reviewed and provided feedback on internal policy draft (no charge)”
“Advised on potential tax implications of proposed transaction (no charge)”

These descriptions show clients the substantive value you’re providing, even when not billing.

2. Track Everything in Real-Time

Never cut your time when entering it. At the end of the month, review the bill and see if any entries warrant a reduction of time. Your client will love to see money come off their bill by way of a “professional discount” or “no charge.”

This approach maintains the integrity of your time records while giving you flexibility in billing decisions.

3. Set Reasonable Limits

While showing goodwill is important, you need boundaries:

Establish monthly no-charge caps per client (typically 2-3 hours)
Review no-charge time quarterly to identify patterns
Consider converting frequent no-charge work into retainer arrangements

4. Use Strategic Timing

No-charge entries are particularly effective when:

Building relationships with new clients
Transitioning between major matters
Responding to quick questions between projects
Maintaining dormant client relationships

Common Pitfalls to Avoid

1. The “Invisible Work” Trap

Never assume clients know about work you’re doing for them. Many attorneys may leave these “meaningless” time entries off their time sheets or invoices, but clients appreciate knowing their lawyers are working for them.

2. Over-Discounting

If you’re writing off more than 10-15% of your time as no-charge, you’re either:

Undervaluing your services
Working with the wrong clients
Need to revisit your fee agreements

3. Inconsistent Application

Nothing frustrates clients more than inconsistent billing practices. If you charge for a 6-minute email one month and mark it no-charge the next, you’ll erode trust rather than build it.

4. Poor Description Quality

Vague entries like “misc. correspondence” or “various tasks” don’t demonstrate value, even when marked no-charge. Be specific about the value you provided.

Leveraging Technology for Better No-Charge Tracking

Modern legal billing software has transformed how firms handle no-charge entries. Here’s what to look for:

Essential Features:

Automatic categorization: Software that can automatically flag certain activities as no-charge based on rules you set
Bulk editing capabilities: Ability to convert billable entries to no-charge during pre-bill review
Reporting functionality: Detailed reports showing no-charge time by client, matter, and timekeeper
Invoice customization: Flexible formatting to prominently display no-charge work

Integration Benefits:

When your billing software integrates with your accounting system (like QuickBooks Online), you can:

Track the monetary value of no-charge work for management reporting
Analyze no-charge patterns across practice areas
Generate year-end client value reports showing total investment
Make data-driven decisions about client profitability

Measuring the Impact: Key Metrics to Track

You can’t manage what you don’t measure. Here are the critical metrics for no-charge time:

1. No-Charge Ratio by Client

Calculate: (No-charge hours / Total hours worked) × 100

Healthy range: 5-10% for most clients, up to 15% for strategic accounts

2. No-Charge to Collection Correlation

Track whether clients receiving no-charge work:

Pay invoices faster
Have fewer payment disputes
Generate more referrals
Increase overall billings year-over-year

3. Timekeeper Productivity Impact

Monitor whether properly tracked no-charge time:

Improves overall utilization rates
Provides better workload visibility
Helps identify training needs

4. Client Retention Metrics

Compare retention rates between clients who receive no-charge entries on invoices versus those who don’t. Firms typically see 15-20% better retention when demonstrating goodwill work.

Industry Insights: What the Data Tells Us

According to Clio’s 2024 Legal Trends Report, lawyers bill just 2.9 hours (37%) of an 8-hour day, with the remainder split between administrative tasks and other non-billable work. Within this context, strategic no-charge work represents an opportunity to:

Differentiate your firm from competitors
Build stronger client relationships
Improve collection rates on billable work

The Legal Trends Report highlights that lawyers collect 91% of their billed hours, meaning they’re losing out on 9% of what they bill to clients. Firms that effectively use no-charge entries often see better collection rates on their billable work, as clients feel they’re receiving fair value.

Creating Your No-Charge Entry Policy

Here’s a template to get you started:

[Firm Name] No-Charge Entry Policy

Purpose: To ensure consistent, transparent recording of no-charge professional services that benefit our clients while maintaining accurate productivity metrics.

Scope: All timekeepers must record no-charge work according to these guidelines.

Guidelines:

Automatic No-Charge Categories:
- Initial client inquiries (up to 0.3 hours)
- Brief status updates (up to 0.1 hours)
- Invoice clarification discussions
- Holiday greetings and relationship touches
Discretionary No-Charge (requires approval for entries over 0.5 hours):
- Strategic advice outside current matters
- Introductions and referrals
- Educational updates on law changes
- Courtesy reviews of brief documents
Recording Requirements:
- Enter time within 24 hours
- Use appropriate NC billing codes
- Include detailed, client-friendly descriptions
- Note reason for no-charge designation
Monthly Limits:
- Standard clients: 2 hours per month
- Premium clients: 4 hours per month
- Strategic accounts: Case-by-case basis
Review Process:
- Billing attorney reviews all no-charge entries before invoicing
- Managing partner reviews quarterly no-charge reports
- Annual analysis of no-charge impact on profitability and client satisfaction

Advanced Strategies for Different Practice Areas

Different practice areas benefit from different no-charge strategies:

Corporate/Transactional:

Quick questions about deal structures between transactions
Updates on market conditions or regulatory changes
Introductions to potential business partners

Litigation:

Brief case status updates
Quick strategic discussions during settlement negotiations
Explanations of procedural developments

Family Law:

Emotional support calls during difficult periods
Quick clarifications about court orders
Brief check-ins between hearings

Estate Planning:

Annual check-ins on life changes
Quick beneficiary updates
Brief explanations of tax law changes

The Psychology of No-Charge Entries

Understanding the psychological impact helps maximize the benefit:

For Clients:

Reciprocity Principle: Clients receiving visible goodwill gestures are more likely to reciprocate with loyalty and referrals
Transparency Builds Trust: Seeing all work performed, even unpaid, creates transparency
Value Perception: Clients better understand the full scope of your investment in their success

For Your Team:

Motivation: Attorneys feel valued when all their work is recognized, even if not billed
Accountability: Complete time tracking improves individual and firm productivity analysis
Professional Development: Reviewing no-charge patterns helps identify training opportunities

Implementation Roadmap

Ready to optimize your no-charge entry process? Here’s your 30-day implementation plan:

Week 1: Assessment

Audit current no-charge and write-off practices
Identify top clients for no-charge strategy
Review billing software capabilities

Week 2: Setup

Configure billing codes
Adjust invoice templates
Create written policies

Week 3: Training

Conduct timekeeper training sessions
Practice with example scenarios
Address questions and concerns

Week 4: Launch and Monitor

Begin consistent no-charge entry recording
Daily review of entries for compliance
Gather initial feedback from team

Day 30: Review and Adjust

Analyze first month’s data
Gather client feedback if available
Refine processes based on learnings

Conclusion: Turning Goodwill into Good Business

In an era of rising billing rates and increased client scrutiny, properly recorded no-charge entries aren’t just about being nice—they’re a strategic tool for building sustainable, profitable client relationships.

Remember: Clients are less likely to question bills when they know that if they were billed for something, it is a legitimate charge because otherwise, it would have appeared as “not billed.”

The firms that thrive in 2025 and beyond will be those that balance profitability with transparency, using every tool available to demonstrate value while maintaining healthy margins. No-charge entries, when properly implemented, are one of the most powerful tools in that arsenal.

Your next step? Review your current billing practices and identify three clients who would benefit most from seeing your no-charge work. Start there, measure the results, and expand based on what you learn.

Because sometimes, showing clients what you’re not charging them for is just as important as what you are.

FAQ

Q: Won’t showing no-charge time encourage clients to expect more free work? A: Not if you set clear boundaries. By establishing and communicating limits upfront (like the 2-hour monthly cap for standard clients), you actually create more structure around goodwill work. Clients appreciate knowing what to expect and are less likely to abuse a system with transparent rules.

Q: How do no-charge entries affect my realization rate? A: They don’t—realization rate only measures the percentage of billable time that gets paid. No-charge entries are excluded from this calculation entirely. However, they do affect your utilization rate (total productive hours), which is why tracking them accurately is important for measuring true productivity.

Q: Should I show no-charge entries for work that was inefficient or took too long? A: No. Only show no-charge entries for legitimate goodwill work, not for covering inefficiencies. Use write-offs for inefficient work to maintain billing integrity.

Q: What’s the difference between a write-off and a no-charge entry? A: A write-off reduces or eliminates charges after they’ve been recorded as billable, often appearing as a discount or adjustment on the invoice. A no-charge entry is recorded as non-billable from the start but still appears on the invoice to show work performed. The key difference is transparency—no-charge entries show the client the work; write-offs typically don’t.

Q: Can no-charge entries help during fee disputes? A: Absolutely. A documented history of no-charge work demonstrates good faith and investment in the client relationship. During fee disputes, being able to show patterns of goodwill work can shift the conversation from purely transactional to relationship-focused.

Q: How should I handle no-charge time for prospective clients? A: Track it internally as business development (non-billable), not as no-charge time. No-charge entries should only appear on invoices for existing clients where you want to demonstrate ongoing value. For prospects, this time is an investment in potential future business.

Sources

TimeSolv. “Creating billable, non-billable and no charge entries.” TimeSolv Legal Billing Software, 2025.
Attorney Protective. “The ABCs of Time Entry.” Attorney Protective Risk Management, 2024.
Martindale-Avvo. “Client Friendly Billing - Time Entries.” Martindale-Avvo Legal Network, 2012.
Clio. “2024 Legal Trends Report.” Clio Legal Practice Management, October 2024.
Brightflag. “2025 Law Firm Billing Rate Increases.” Brightflag Legal Operations, September 2025.
LawVision. “2024 Strategic Pricing Survey.” LawVision Group, 2024.
Wells Fargo Legal Specialty Group. “2024 Law Firm Financial Performance Survey.” Wells Fargo, January 2025.
American Bar Association. “Model Rules of Professional Conduct - Rule 1.5.” ABA, 2024.