Design and Implement Comprehensive Outside Counsel Rules and Guidelines

Sarah Scales of Brightflag presents a detailed roadmap to help in-house legal teams design, implement, and enforce comprehensive outside counsel rules and guidelines (OCGs). For in-house legal teams working with law firms, OCGs act as a rulebook, codifying legal teams’ expectations for staffing, billing, communication, and AI usage. 

When drafted carefully, OCGs strengthen partnerships, improve budget predictability, and ensure that legal services are delivered efficiently and ethically. The absence of clear and enforceable OCGs results in risk miscommunication, billing disputes, and unnecessary costs. 

Areas typically covered by OCGs include resourcing at the right level of expertise, defining commercial terms such as agreed-upon rates and budgets, determining what work should or shouldn’t be charged, describing when and how to bill, and leveraging AI tools for efficiency and cost reduction. 

Within each of these areas are rules, which must be enforced consistently, and guidelines, which allow for some discretion. For example, commercial terms such as timekeeper rates, budgets, and business reviews are non-negotiable. On the other hand, resourcing guidelines—which address appropriately experienced staffing, diversity, and limits on billable hours per day—are flexible. 

The guidelines outline banning charges for administrative support services, rejecting improper expenses, and clarifying protocols around internal communications and meeting attendance. Other topics include detailed billing hygiene requirements, such as prohibiting block billing and defining invoice formats, deadlines, and accruals. AI-specific guidelines direct law firms to use generative tools responsibly, emphasizing data security and cost-efficiency. 

Well-crafted outside counsel rules and guidelines help legal departments control spend, minimize friction, and foster valuable long-term law firm relationships. To maximize effectiveness, Scales recommends concise, regularly updated OCGs that align with company policies. Specifying clear communication channels, clarifying the invoice review process, and ensuring gradual onboarding further support adoption.