AI in legal practice: efficiency gains challenge the billable hour

A new study by Irnerius examines the growing adoption of artificial intelligence across the legal sector and explores its implications for legal workflows, business models, and employment

Artificial intelligence has become part of the daily routine of legal professionals, yet its integration into legal workflows remains far from complete. This is one of the key findings of a study published by Irnerius, which examines AI’s impact on the legal profession in Italy and internationally by drawing on recent research from Anthropic, Wolters Kluwer, and Harvard University.

According to the report, the use of AI tools has accelerated significantly over the past year, both in law firms and in corporate legal departments. In most cases, however, AI is still being used for relatively limited tasks (such as drafting first versions of documents, summarising contracts, or reviewing texts) rather than driving a broader redesign of legal processes. As a result, a substantial gap remains between the technology’s potential and its actual implementation.

The study highlights Anthropic’s concept of observed exposure, which distinguishes between the tasks AI is theoretically capable of performing and those for which it is actually being used. In the legal sector, the potential for automation is considerable, yet real-world adoption remains relatively limited, largely due to organisational and cultural barriers rather than technological constraints.

Similar conclusions emerge from the Future Ready Lawyer Survey 2026 conducted by Wolters Kluwer. The survey found that 92% of legal professionals now use at least one AI tool in their work, while more than six in ten report weekly time savings of between 6% and 20%. At the same time, AI is prompting a broader discussion about the economics of legal services, with a significant proportion of respondents expecting the traditional billable-hour model to become less central in the years ahead.

When it comes to employment, however, the report urges caution. Current evidence does not indicate a significant impact on overall legal employment. Some early signals are emerging, particularly with regard to entry-level hiring. Recent studies cited in the report suggest that organisations adopting generative AI more extensively are slowing the recruitment of junior professionals, while demand for senior talent remains broadly unchanged. Rather than replacing existing lawyers, AI appears to be influencing hiring strategies and the composition of future legal teams.

The research also points to the risk of a widening competitive gap between larger organisations (including international law firms and well-resourced corporate legal departments) and smaller firms. Investment in technology, skills development, and process redesign could further strengthen the competitive advantage of organisations that are better equipped to embrace digital transformation.

Ultimately, the study concludes that artificial intelligence is not simply introducing new tools into legal practice: rather, it is gradually reshaping the way legal work is organised. The decisive factor, according to the authors, will not be whether organisations adopt AI, but whether they are able to rethink their operating models and redesign legal processes around the opportunities that the technology creates.