AI makes legal work faster, but law firms still charge the same rates
Only 6 per cent of law firms cut fees despite AI cutting costs; 34 per cent raised charges instead.
Legal firms across Australia and worldwide are using AI to work faster and cut costs, but most are not passing savings on to clients. Axiom surveyed 528 legal leaders across six countries in March 2026 and found that of the 79 per cent using AI, only 6 per cent lowered their fees for AI-assisted work, while 34 per cent increased their charges.
Matthew Bautz, co-founder of Sydney firm AQMN, said keeping efficiency gains instead of sharing them is "a pretty big middle finger to your client." His firm switched to retainer billing instead of hourly rates, which changed incentives to focus on speed and accuracy.
AQMN has achieved 100 per cent client retention and now only accepts retainer-based work. Bautz noted that firm profitability and AI adoption are both at record levels, showing most efficiency gains stay with law firms.
- 528 legal leaders
- Survey respondents
- 6
- Countries surveyed
- 6 per cent
- Firms lowering AI fees
- 34 per cent
- Firms raising AI fees
Why it mattersClients of legal firms are subsidising the firms' AI productivity gains without receiving cheaper services or better value, an unsustainable position that is beginning to change.
AustraliaAustralians paying for legal services are not benefiting from AI cost cuts most firms are making, though some firms like AQMN are now offering fixed-fee retainers that align incentives with client savings.
✓ Claims checked against the source and corrected before publish. checked 11 d ago
