Template: The AI Addendum for Your Outside Counsel Guidelines

Why you need this now

In-house teams are increasingly frustrated. In the ACC/Everlaw GenAI survey, 59% of respondents had seen no noticeable savings from their firms' use of AI, and 61% planned to push for pricing changes tied to it. At Legalweek 2026, the client-side conversation had moved from curiosity to accountability.

Meanwhile, the firms have a fair point too: AI tools cost real money, and they're taking on the investment and the risk. The goal of an OCG addendum isn't to punish firms for using AI. It's to set clear, fair rules so both sides know how the value gets shared.

How to use this template

1. Pick the provisions that fit your relationship. Not every clause suits every panel.
2. Replace text in [brackets].
3. Share a draft with two or three trusted firms before rolling it out broadly.
4. Pair it with a conversation about pricing, not just a PDF attached to an email.

AI Addendum to [Company] Outside Counsel Guidelines

1. Purpose

[Company] encourages outside counsel to use artificial intelligence tools that improve quality, speed, and cost-effectiveness, provided they are used consistent with this Addendum and counsel's professional obligations.

2. Approved use and data protection

2.1 Counsel may use AI tools on [Company] matters only if the tool (a) does not use [Company] information to train or improve models available to others, (b) maintains [Company] information as confidential, and (c) meets counsel's information security standards.

2.2 Counsel shall not input [Company] confidential information into consumer or free AI tools.

2.3 Upon request, counsel will identify the AI tools used on [Company] matters and confirm they meet Section 2.1.

3. Disclosure

3.1 Counsel will disclose material use of AI on a matter, such as AI-assisted document review, contract analysis, or drafting of substantive work product, in the engagement plan or matter budget.

3.2 Counsel will notify [Company] before using AI in any manner that would be visible to a court, regulator, or counterparty, where disclosure rules may apply.

4. Professional responsibility

4.1 Counsel remains fully responsible for all work product, regardless of AI use, including verification of all citations, facts, and legal analysis.

4.2 AI output must be reviewed by a qualified attorney before it is relied on or delivered to [Company].

5. Billing

5.1 Time. Counsel may bill actual time spent reviewing, verifying, and refining AI-assisted work. Counsel may not bill for time spent learning, configuring, or troubleshooting AI tools.

5.2 Tool costs. AI tool subscriptions and usage costs are overhead and may not be billed to [Company] unless approved in writing in advance.

5.3 Efficiency. For repeatable work types identified by [Company], counsel will propose fixed or capped fees that reflect efficiencies from AI.

5.4 Task coding. Invoices will use [UTBMS / Company-specific] task codes consistently to allow year-over-year comparison.

6. Reporting

6.1 On request, and at least [annually], counsel will report on how AI was used on [Company] matters and the resulting impact on cycle time, staffing, and cost.

7. Records and holds

7.1 Counsel will ensure that AI prompts and outputs relating to [Company] matters can be preserved and produced when subject to a legal hold or discovery obligation.

Rollout tips

• Lead with partnership. Frame the addendum as "here's how we'd like to share the value," not "here's how we'll catch you."
• Pick pilot matter types. Start fixed-fee conversations with two or three repeatable categories.
• Enforce with systems, not memos. Your e-billing and spend management platform can flag AI tool charges and training time automatically.
• Benchmark. Use spend analytics to compare cost per matter type before and after the addendum.
• Revisit annually. AI pricing and ethics guidance are both moving quickly.

The bottom line

Your firms are going to use AI either way. An OCG addendum makes sure you know how, your data is protected, and you share in the efficiency. Adapt the language above, then use the legal infrastructure tools on CorporateLegal.tech to enforce it without reading every invoice by hand.

This template is a starting point, not legal advice. Adapt it to your jurisdiction and relationships.