Key Trends In The Legal Industry For 2025

It’s hard to believe, but we are now a quarter of the way through the 21^st century. In 2024, we drifted past the digital revolution, into the realm of AI-driven transformation. The way legal work is being delivered and valued is rapidly changing, and in 2025, we predict the following trends will swing into your firm’s operational, marketing, business development, and client care spotlight.

A greater shift to AI-based technology

According to recent research by LexisNexis, 82% of Solicitors are either using or planning to use AI in their legal practice, up from 39% just 12 months previously. However, it is becoming increasingly clear that for the moment, Moravec’s paradox, first described in 1988, (what’s easy for humans is hard for machines, and what humans find challenging is often easier for computers) holds up. Although AI is brilliant for monotonous tasks such as document reviewing and drafting, it cannot replace a legal professional’s ability to strategise, empathise, and analyse risk. Investing in technologies that remove the work that can be done by machines, will free up Solicitors to do what they do best and provide clients with stronger solutions and better results.

A move to fixed-fee billing

Legal technology provider Clio recently commissioned UK-specific research into the legal sector and found that 54% of Solicitors expect to increase their fixed-fee offerings, in line with client demands and the need to remain competitive.

The LexisNexis report, ‘Calling time on the billable hour’ confirmed that clients were driving the move to alternative billing solutions. Again, technology and data are seen as the driving force behind the move away from billable hours and towards alternative fee structures.

Isabel Parker, executive director of the Digital Legal Exchange, an independent forum for general counsel designed to accelerate digital transformation in the legal industry told LexisNexis, "Better use of data will be really, really critical for disrupting this billable hour model. Law firms bill their time in six-minute increments, so they're sitting on a lot of time recording data, so if that data can be mined and used for insight about what's really involved in delivering a matter, law firms would have much more confidence in the way they price."

Communicating with clients differently

Most clients are now used to communicating with businesses through digital means, be it WhatsApp, email, or chatbots. However, regarding the latter, just because people are used to them, it doesn’t mean they particularly like having to communicate with a bot. Therefore, law firms need to ensure they build chatbots that “people don’t hate”. It is also important to keep an eye on the digital detox trend when making decisions regarding customer service options. With evidence coming through thick and fast regarding the damage smartphones and internet addiction have/are causing, and a move to restrict children’s access to social media announced in Australia, with Singapore looking to follow suit, and the small, but growing movement of ditching smartphones and replacing them with ‘dumbphones’, it is probably wise to retain a significant human element to your client facing activities.

A realistic focus on work/life balance…perhaps

In 2024, a series of articles highlighted the extraordinary hours put in by junior solicitors in the top 100 UK law firms. With starting salaries of £170,000 in some firms, 13-hour days are not uncommon, and weekend work is often expected. A January 2024 LexisNexis survey  , revealed that only a quarter (25%) of associates want to make partner at their current firm within the next five years. In large law firms, this dropped to 22% and only 23% of Solicitors at medium-sized firms desired to be a partner.

Deborah Finkler, Managing Partner at Slaughter and May, commented:

“Becoming a partner at a law firm requires a huge amount of work and commitment, and always has. This generation of associates are just more realistic about the likelihood of becoming a partner at their firm, and do not feel they need to pretend that staying and becoming a partner is their only option.”

With many firms still facing pressure in finding and retaining talent, these statistics are likely to be sobering. Is this the year the legal sector says goodbye to the long hours culture? Or will increasing client demand for more work for less money, thanks to predicted AI-generated efficiencies, mean burning the midnight oil will remain firmly entrenched in some practices?

Final words

With signs that the UK economy is heading in the right direction with modest growth of 1.5% predicted by the IMF 2025 looks likely to be a year filled with opportunities.

From everyone at Albion Legal, we wish you a prosperous and happy New Year.

Albion Legal provides a range of added-value products and services, from bespoke employment disputes insurance cover to white-labelled HR software. To find out how we can help your business, please phone 0113 2471 717 or email our team.