It is not uncommon for law firms to utilize or employ contract attorneys. Unfortunately, it is also not uncommon for firms to run into ethical issues surrounding how the firm has billed its client for a contract attorney’s time.  Texas Ethics Opinion No. 577 (March 2007) addressed the issue of a law firm’s hiring of a lawyer who was not an associate, partner or shareholder of the law firm (i.e., a contract attorney) and whether the firm could bill the client a higher fee for the work done by that lawyer than the amount the firm was paying the lawyer.  The answer does not depend on what you call the person (“of counsel”, “contract”, “part-time”) but rather it depends on whether the lawyer can be objectively considered “in” the law firm as compared to a “non-firm lawyer.” 

As set out in Opinion 577, a lawyer will…