Outside Counsel Guidelines: a Template for In-House Teams

What are outside counsel guidelines? Outside counsel guidelines (OCGs) are the rules an in-house legal team gives to the law firms it hires. They set out how the firm should staff a matter, how it should bill, what it may and may not charge for, how it must communicate, and how it must protect the company's confidential information. OCGs turn a loose relationship into a predictable one, and they are where an in-house team controls legal spend without renegotiating every invoice. Every company's OCGs differ, but the structure below covers what most in-house teams need. Use it as a starting point and adapt it to your spend, your matters and your jurisdiction. This is general guidance, not legal advice. ## Outside counsel guidelines template Copy the block below and adapt the bracketed fields. ```

OUTSIDE COUNSEL GUIDELINES - [COMPANY NAME] 1. PURPOSE AND SCOPE These guidelines apply to all law firms and individuals engaged to provide legal services to [Company] and its affiliates. By accepting a matter, the firm agrees to these guidelines. Where they conflict with an engagement letter, these guidelines prevail unless [Company] agrees otherwise in writing. 2. ENGAGEMENT AND CONFLICTS No work may begin until a matter is formally opened by [Company]. The firm must run a conflicts check before accepting a matter and must disclose any actual or potential conflict promptly. 3. STAFFING The firm will staff each matter leanly and consistently. Partner changes and new timekeepers require [Company] approval. [Company] will not pay for the time of more than [N] timekeepers at an internal meeting, or for time spent bringing a new timekeeper up to speed. 4. RATES Rates are fixed for [period] and set out in the engagement letter. Rate increases require [Company] approval [N] days in advance. [Company] encourages alternative fee arrangements (fixed fee, capped fee, blended rate) for suitable matters. 5. BUDGETS The firm will provide a matter budget before starting work and will flag when actual fees are likely to exceed the budget by [X]%. 6. BILLING FORMAT AND CADENCE Invoices must be submitted [monthly] in [LEDES / specified] format, within [N] days of month end, with task level detail. Block billing is not permitted. Time must be recorded in [0.1 hour] increments. 7. WHAT [COMPANY] WILL NOT PAY FOR [Company] will not pay for: administrative or secretarial time; first class travel; internal conferencing among the firm's own timekeepers beyond [N]; time to prepare or revise invoices; legal research database surcharges; or overhead such as word processing. 8. EXPENSES Expenses are reimbursed at cost with no mark up. Travel requires prior approval above [amount]. Receipts are required above [amount]. 9. COMMUNICATION AND REPORTING The firm will provide [monthly] status updates and immediate notice of any material development, adverse ruling or settlement opportunity. 10. CONFIDENTIALITY AND DATA SECURITY The firm will keep [Company] information confidential, store it securely, limit access to the matter team, and notify [Company] of any data breach within [N] hours. 11. USE OF ARTIFICIAL INTELLIGENCE The firm will not input [Company] confidential information into any AI tool that trains on or retains that input, and will disclose material use of AI in producing work product, on request. 12. DOCUMENT RETENTION AND FILE On request or at the end of a matter, the firm will return or securely destroy [Company] files and provide the complete matter file. 13. DIVERSITY [Company] asks the firm to report the diversity of the matter team [annually]. Accepted for the firm: __________ Date: __________

- **Billing format (section 6).** Require a structured billing format and task level detail, ban block billing, and set the cadence. In the US, LEDES e-billing is standard. In India, e-billing is less common, so specify the format and detail you expect. <!-- [VERIFY: LEDES e-billing adoption lower in India; confirm what your e-billing system requires] -->
- **What you will not pay for (section 7).** Be explicit. Administrative time, invoice preparation time, and internal conferencing are the usual targets.
- **Data security and AI (sections 10 and 11).** These are the modern additions. Set a breach notice window and address whether and how the firm may use AI tools on your information. ## Common mistakes in-house teams make - OCGs that are never enforced, so firms ignore them and bill as they like.
- No budget requirement, so there is nothing to measure overruns against.
- Silence on AI, when firms increasingly use AI tools that may retain inputs.
- No clear rule on what is not billable, which leaves every disputed line to argue.
- Guidelines that conflict with the engagement letter with no statement of which prevails. ## A note on jurisdiction Billing norms differ. LEDES e-billing codes and detailed task billing are standard in the United States and common in large UK and multinational matters. In India, hourly billing with detailed narratives is widespread but structured e-billing is less established, so set out the format and detail you require rather than assuming a standard. Conflict rules, confidentiality duties and privilege also vary by jurisdiction, so align your OCGs with local professional conduct rules. ## Keeping guidelines applied, not just written The hard part is not writing OCGs. It is making sure every engagement letter and invoice actually follows them across many firms and matters. That is the same problem as managing any set of standard terms at scale: you want your approved positions in one place, you want to see at a glance where a firm's engagement letter departs from them, and you want the renewal and rate review dates in view. An AI contract workspace tuned to how your company engages counsel can draft from your standard terms, flag where a firm's paper differs, and keep the key dates tracked, so your guidelines are applied in practice rather than filed and forgotten.