Why Are Women Attorneys Unhappy
Have we come a long way baby? When it comes to female lawyers at law firms, the answers may be a resounding no. While women represent approximately 45% of associates, the only represent 20% of partners.
Vault took a look back at its most recent Associate Survey, in which nearly 17,000 associates at law firms from across the country rated their firms in areas such as satisfaction, hours, compensation, diversity, and associate/partner relations. And in nearly all of these areas, women rated their firms lower than did men. While that’s not new, what is interesting is that the same issues that have plagued women’s careers over the last few decades endure:
First, many female associates feel that it is impossible to have a family and make partner—and so they take themselves off the partnership track, even before they have children.
If that’s true, so what can firms do about it? How many progressive law firms offer on-site childcare or reduced hours with the opportunity to make partner? Not many. At the end of the day, it’s about billing a lot of hours and bringing business to the firm, and if you have other responsibilities, such as child rearing, and don’t want to have a partner or third parties to do it for you, the chances of making partner are slim to none. Unless firms change the rules of the game, the choices for women will be the same.
Second, female associates complain that their male counterparts have different—and better—opportunities for business development, important assignments and mentorship.
Is this a case where men prefer other men in terms of providing assignments, either consciously or subconsciously? Could this be related to the fact that women are not perceived as available or motivated to become partner? Given that a majority of women are leaving before partnership there is some truth to that assumption, and this could be a catch-22 issue. Would women partners be more likely to provide other women more opportunities? That’s not necessarily true. Perhaps this is a case where women may have to be more proactive and actively seek opportunities, rather than wait for them to be assigned.
Finally, a common complaint among senior women associates is that their potential for making partnership is not clear enough.
That gripe is equally true when it comes to men. What it takes to make partner at major law firms is as clear as mud, whether you are a man or a woman. However, the fact that men represent 80% of partners may means that the message is not necessarily what is making the difference. At the end of the day, you have to stand out. To do that, you have to work on the big transactions and litigation, put in the hours, and bring in the clientele. There is no one way to do it, and firms are not keen to give its associates clear directions on how to make it, simply because there isn’t a whole lot of room at the top.
While law firms have been creating more innovative and far-reaching programs and policies, the rub is in the lack of action. The numbers speak for themselves. The good news is that these are issues that are being talked about, but the bad news is that old stigmas, gender assumptions, and business practices endure.
Tug of War: Firm Profits vs. In-House Savings
As more in-house lawyers question the billable hour and continue to lean towards value-based alternative fee arrangements (VBFs), law firms are quick to counter that the economy is picking and that discounted fees may be nearing an end.
Who will win this tug of war? The economy may be the deciding factor.
A new study has some good news and some bad news for both law firms and in-house legal departments. The economy is on the rebound. The pace of claims for unemployment insurance continues to be the lowest since January 2008, and housing Rose 0.8 percent in February.
Confidence is also up. According to an article by Corporate Counsel, Managing partners’ overall confidence in the economy was up 18 points between the third and fourth quarters of 2012, and 85 percent predicted future revenue growth, according to the latest Law Watch Managing Partner Confidence Index survey from Citi Private Bank.
However, while we may no longer be in a recession, the economy still hasn’t really recovered. According to an article by the Washington Post, some 12 million Americans are still looking for work, and many millions more would confirm that it hasn’t felt like a recovery at all. That would include the people who have seen their incomes flatline or have been drowning in mortgage debt for years on end.
This is not just a feeling, but reality supported by hard data. According to the Post, since the start of 2010, growth has averaged 2.2 percent, which would be just fine in normal times, but is lousy considering the starting point was a time of mass unemployment and general economic despair.
In-house legal department are weary of the future and continue to be conservative with spending. As a result, large companies with leverage have been negotiating their way into discounted legal fees. Case in point, GlaxoSmithKline increased its use of VBFs from 3 percent to 68 percent; United Technologies Corporation’s use of VBFs is more than 70 percent; Home Depot, more than 75 percent; and Pfizer is 100 percent VBF according to Corporate Counsel.
In general, law firm managing partners are concerned that clients will continue to push for discounted fees. And they should be. Unless the economy begins to show stronger signs of a recovery, in-house legal department will likely continue to push and receive discounted fees.
Foreign Attotneys May Now Work In the U.S. as In-House Counsel
It looks like in the midst of immigration reform by the Obama administration,things may be looking up for foreign lawyers. Under a resolution approved on Monday by the ABA House of Delegates, foreign lawyers will have limited authority to serve as in-house counsel in the United States.
Resolution 107A is among a series of proposed amendments to the ABA model ethics rules that acknowledge the globalization of law practice. It amends Rule 5.5(d) of the ABA Model Rules of Professional Conduct concerning unauthorized practice and multijurisdictional practice. The amendment states that foreign lawyers may work as in-house counsel in the United States, but they may not give advice on U.S. law unless it is based on the advice of a lawyer who is licensed in the appropriate jurisdiction. A related resolution, 107B, requires registration for foreign lawyers working as in-house counsel.
Seven states already expressly permit foreign lawyers to work as in-house lawyers in the U.S. offices of their clients. This will likely open the gates to foreign lawyers looking to practice in the U.S. But how does that bode with our current economic climate? The legal market has yet to bounce back, and employment numbers are still low. With thousands of U.S. lawyer unemployed and many more U.S. law graduates still seeking employment, how will this impact our market? The answer remains to be seen.
What Does It Take To Become An In-House Counsel?
The number of attorneys who are interested in making the transition in-house is increasing, despite current economics. While securing an in-house position has always been difficult because of supply and demand, doing so in this economy is even more challenging. There is a significant distinction between wanting to go in-house and being ready to go in-house – something that many attorneys tend to miss when conducting their job search. In this article, we discuss what it takes to become a strong candidate for an in-house position in today’s marketplace.
Experience
The ideal in-house candidate is an experienced attorney with at least five years or more of professional practice experience, who can operate fairly independently. Why five years or more? In-house legal departments are not good training grounds for recent law graduates and junior-level attorneys. Companies generally do not have the resources available to train attorneys. Moreover, in-house attorneys, unlike their law firm counterparts, are viewed as part of overhead. Therefore, while attorneys are a necessity, they do not contribute to the financial bottom line of the companies they serve. Therefore, in-house legal departments have every incentive to want to hire experienced attorneys who require little training or supervision.
Is there such a thing as too much experience? In some cases, there is. Companies tend to value hiring attorneys who have both law firm and in-house experience. Partner-level attorneys who only have law firm experience are at risk of being passed for positions, junior-level or otherwise. They tend to be viewed as too specialized, not business-oriented enough, and lacking in industry experience. That prejudice tends to grow in accordance with the length of time they have remained in private practice without ever having held an in-house position. Partner-level attorneys are often viewed as too “inflexible” and expensive to successfully transition in-house. In an employer-driven market companies get what companies want, whether or not these preferences are justified. Therefore, the best time to consider an in-house transition is after five years of practice and before partnership.
Practice
When it comes to the type of practice area in-house legal departments are interested in when hiring, it is important to remember that not all practice areas are created equal. While corporate law departments do hire attorneys in a variety of specialized practice areas, including litigation, labor and employment, intellectual property, real estate, and tax – to name a few, these positions are few and far in between. In other words, there are very few in-house legal opportunities available for these practice areas. Moreover, because of the type of competition that is generated for these few position, outstanding candidates are often kept from ever making the final cut.
If you are playing a numbers game, which is what you have to do when considering an in-house attorney position, and you are interested in moving up on the in-house totem poll, you should have general corporate and commercial contracts experience. In other words, transactional attorneys have an edge in the number of positions available to them, not to mention improved prospects for advancement within law departments, including general counsel positions.
To improve your odds even further, you should supplement your transactional practice with some exposure to litigation, employment, corporate governance, finance, intellectual property, and governmental regulations, to be able to assist a company gets its goods or services to market. Corporate law departments tend to look for “generalists,” or attorneys who are able to spot issues and handle matters in a wide variety of areas. In other words, most in-house counsel act like ER doctors conducting triage when the ambulance gets in. They have to quickly identify the problem, establish priorities, determine what they can handle themselves and whether they will require the services of a specialist, or in this case an outside counsel.
Aptitude
Even if you have the required experience and practice area to be a good candidate for an in-house position, there are a number of “soft skills” you need to be competitive and successful for these positions. First, as an in-house attorney you need to have business sense. When a company hires in-house counsels, they are expected to provide legal advice in a business context. The ability to understand business objectives and provide legal advice to non-lawyers is crucial to succeeding as an in-house counsel. Along those lines, the ability to persuade is also an important quality to have, as counsels often have to defend their positions. This assumes strong negotiation skills, as well as superior oral and written communication skills.
In-house attorneys are also required to work with a wide variety of people, from senior executives to employees on the floor. Therefore, having strong interpersonal skills and the ability to be comfortable in a variety of situations, from conducting formal board meetings to dispensing informal hallway advice, it very important as well. Finally, a successful in-house attorney must be able to provide practical advice. In other words, companies tend to turn to their counsel for solutions to their business problems, rather than for textbook advice or opinions. To be an effective problem-solver, an in-house attorney must not only be familiar with his company’s business, structure or industry, but also its culture and its risk management standards. Of course, these are but a few of the soft skills that are required to be an effective in-house counsel; there are others, many of which are company and industry-specific. What is to be remembered is that being an experienced and skilled legal practitioner, while a requisite, is not always sufficient to become a strong candidate for in-house positions in today’s marketplace.
5 Myths About Legal Recruiters
A good legal recruiter can help you find the job you’ve always wanted. That said, candidates generally don’t understand what legal recruiters do, or how best to use them. To maximize this partnership and motivate them to be your advocate, here are 5 myths that need to be dispelled:
MYTH 1: A Recruiter's Job Is To Find Me a Job
FACT: Legal recruiters are paid by their employer clients—not their candidates. Their job is to find the best talent for the position the employer is seeking to fill. They have to keep in mind all of the employer’s requirements and deliver candidates that are an exact match. They aren't paid to help people transition to new practice areas, find jobs for those that have been unemployed for long periods of time, or practiced on their own as solo practitioners. Instead, they are seeking talented individuals who have done the job already in a different context, or candidates ready to move up to the next level in their same career path. Also, companies simply do not accept unsolicited resumes from recruiters. They hire them for specific jobs. So it is not within a legal recruiter’s capacity to present you to their current or former clients just based on your strength as a candidate; it simply does not work that way. While good recruiters dedicate extensive time and resources to working with candidates who are likely to meet their employer clients’ expectations, they are not an employment agency, career counselor, or coach for job seekers. Therefore, recognize their role and advantage of your legal recruiter’s knowledge regarding the search and hire process, and the legal marketplace.
MYTH 2: Recruiters Are Rude and Unresponsive
FACT: The truth is that most recruiters simply don't have the time to respond to the hundreds of unsolicited resumes and phones call they receive every week. It is also common for a recruiter to make over fifty calls each day, and with that kind of volume they simply don't have the time to deal with unplanned conversations. Legal recruiters, like anyone, have limited time and resources, and have to prioritize who is worth speaking with, and for how long. They are likely to be very responsive to clients or potential clients who have job orders for them to fill, and people who they see as strong candidates for those job orders. They are likely to be much less responsive to those who approach them out of a sense of desperation, with a career change in mind, or for whom they don’t have a job to submit them to.
MYTH 3: It’s Best to Work With Multiple Recruiters or Bypass Them Altogether
FACT: If you are seeking a law firm job, you need only one good recruiter to handle your search. Virtually all law firm searches are done on a “contingent” basis, meaning any reputable recruiter can submit a candidate to a prospective employer for consideration. Choosing one good recruiter ensures that you have access to all law firm openings. In contrast to a law firm search, if your goal is an in-house position, then you should engage multiple resources. However, while most in-house positions are filled on a “exclusive” basis, some in-house searches are conducted on a “contingent” basis, much like firm searches, meaning that the company accepts candidate submissions from a number of reputable recruiters. You should authorize your chosen recruiter to monitor such opportunities on your behalf. When you hear about a job from recruiters, and decide to bypass them by sending your resume directly to the employer, so you don’t come with a fee, think again. Chances are the recruiter and employer are working on an “exclusive” basis, so you’ll still have a fee attached to your candidacy, and you’ll likely have to be vetted by the same recruiter you tried to bypass. Rather than optimizing your goodwill and have the recruiter help put your best foot forward before an employer, you may have lost your only internal ally. The same can be said in a contingent situation; for the legal recruiter will have an incentive to make you stand out from the rest of the applicants. They will be able to discuss your candidacy directly with the employer, and potentially make the difference. On your own, you will not have anyone able to help you get a leg up on the competition.
MYTH 4: Recruiters Aren't Interested in Negotiating The Best Compensation Package
FACT: The majority of legal recruiters are paid recruiting fees that are a percentage of the new hire's first year base salary. The more you earn, the more they earn. Therefore, it is generally in their best interest that you obtain the best possible compensation package. Legal recruiters often they have inside information about what a company is willing to pay, and are able to negotiate a higher salary than what a candidate initially thought they could get. However, the opposite is often true. The company may have already discussed what they would be willing to pay for a top notch candidate, or made it clear that they are not willing to negotiate. In these cases, legal recruiters can do little but to advise candidates of the same, and not enter into negotiations that will not only produce no results, but also potentially damage the newly created relationship between the candidate and the employer. Companies do not take the recruiter's commission out of the new hire's compensation. Employers who have decided to hire a recruiter to assist them with the search understand that they must pay a premium for candidates sourced through recruiters, and are willing to do so.
MYTH 5: Recruiters Don't Care About Creating Long-Term Relationships
FACT: Legal recruiting is a relationship-building business. Successful recruiters know that their long-term success is based on building their network of relationships. Repeat business that comes from gaining multiple job orders from the same company is a key ingredient to any successful legal recruiting firm. The same can be said of candidates that were not a good fit for a current job, but went out of their way to introduce them to someone who was, or tried to provide them with job leads. These are the sort of candidates that a recruiter will remember and likely contact when they have a good job order to fill. Recruiters also have connections that can help candidates; and they are likely to offer them to those that showed a great deal of professionalism and respect of the process. One surefire way to get a recruiter's attention and build a long-term relationship with them is to offer to provide the names of people who are strong connectors to others, thought leaders, and high performers in their specialized field. Thinking of the relationship as “qui pro quo” can go a long way towards establishing a relationship that can be fruitful for both parties.
Not every candidate will find success working with a legal recruiter. However, if you are accomplished in your field and committed to staying in it, building relationships with legal recruiters who specialize in your skill set and industry can be your greatest asset in your job search.
No Change in Hiring Through the End of 2012
Legal hiring remains sluggish and there are not signs of improvements on the horizon through the fourth quarter of 2012. According to a report released by Robert Half, a little over 30% of lawyers interviewed in law firms and corporate legal departments were planning to hire. That means that the greater majority, nearly 70% don’t.
What’s driving the hiring? Since the recession, we have yet to see hiring driven by growth. In other words, hiring is limited to instances where adding a headcount will reduce cost or improve productivity. In other words, corporate legal departments are only selectively hiring if the legal hires are capable of handling legal work in-house more cheaply than outsourcing it to a law firm. Law firms are seeking attorneys with solid business development skills and client portfolios to expand practice groups in high-demand specialties such as health care and corporate law.
In short, this is still leaving a lot of lawyers in the cold. The only “pick-up” in hiring activity seems to be centered on full-time legal staff including paralegals, legal secretaries, and contract administrators. Why? Because they are more economical to hire than full-fledged lawyers. The practice areas that are generating the most interest in-house remain corporate, compliance, and privacy.
The New “Hot” In-House Practice Area: Privacy Law
Why Is Privacy Law So "Hot"?
Innovations in technology have made it easier to track, collect, and process personal information about individuals. As a result, companies of all kinds are challenged to manage the way that they use data to both comply with U.S. and non-U.S. laws and to protect such data from unauthorized access.
What makes it even more challenging, is that in addition to maintaining compliance in a continuously evolving legal landscape, companies must also contend with industry standards promulgated by a wide array of diverse and sometimes overlapping industry groups. Regulations and court decisions have opened the door to increased liability for companies. Companies also have to contend with cyber hacking, data breaches, and other privacy concerns that are exposing them to further liability and costing them a great deal of money.
Why Are Companies Increasingly Hiring CPOs and Privacy Counsels?
Companies are increasingly suffering from data breaches, as hackers are getting more sophisticated and finding new ways to steal sensitive data from seemingly secure enterprises. This is a growing concern that is costing companies a great deal of money.
One study reported on 1,700 instances of computer hacking, cyber terrorism, and other data breaches in the past seven years, resulting in some 900 million compromised records. Another study of 49 breaches in 2011 reported that the average cost of a data breach (including detection, internal response, notification, post-notification cost and lost customers) was $5.5 million.
To handle the growing promulgation of ever-changing privacy laws and protect themselves from liability and exposure to computer hacking, cyber terrorism, and other data breaches, companies have been steadily adding key chief privacy officers and privacy counsels to their ranks.
Today, companies that maintain consumer or employee information have to address data protection issues and take measures to mitigate the risk of loss of the sensitive data it stores. Failing to do so can result in serious legal ramifications, not to mention public relations and business problems. As a result, more chief privacy officers and privacy counsels are joining companies of all sizes, and this is a trend that is certain to continue. In terms of industries, financial services, technology and software and healthcare lead industries with privacy hiring efforts.
In addition, not only are companies increasingly hiring chief privacy officers and privacy counsel, but they are also requiring general counsels, as a part of their skill set, have some expertise in privacy and data protection law. This is a new and increasing trend.
What Are the Salaries for CPOs and Privacy Counsels?
When it comes to hiring chief privacy officers and privacy counsels, it is a classic case of supply and demand. This is relatively new practice area; therefore, the number of chief privacy officers and privacy counsels is small compared to the demands. The pharmaceutical and professional services industries offer the greatest compensation and salaries, and depending on geography, industry, and company size, CPO’s salaries can range from the high 200K to the mid $400K. In terms of salaries for privacy counsels, they are akin to those offered for intellectual property counsels. Again, depending on geography, industry, and company size, privacy counsels salaries generally average $145K.
Hiring Paralegals Over Lawyers
Are companies hiring paralegals over lawyers? It looks like that might be a trend gaining some traction. The economy is not necessarily on the rebound, and signs of improvements are nothing if not unpredictable and unsteady. After gaining jobs for two straight months, the legal sector lost 1,300 positions in March, according to preliminary data released Friday by the U.S. Bureau of Labor Statistics. Most worrisome are predictions that lawyer jobs may be on the decline.
The Bureau of Labor Statistics predicted, "Growth in demand for lawyers will be constrained as businesses increasingly use large accounting firms and paralegals to do some of the same tasks that lawyers do." The report estimated that overall legal sector employment will increase 11 percent by 2020, and that paralegal and legal assistant jobs will surge 18 percent.
The good news is that companies are hiring, the bad news is that they are only doing so very selectively. With law departments on the brink of having operated by “doing more with less” for several years, some are looking to hire help. But experts caution that companies aren’t necessarily hiring lawyers. The bulk of the hiring seems to be dedicated to paralegals and contract managers. When it comes to hiring lawyers, the numbers are still very low, and the competition very stiff. That competition will grow even stiffer in the years to come as the Bureau of Labor Statistics predicted that the number of lawyers practicing in the country would grow 10 percent between 2010 and 2020—from 728,000 to 801,800.
While most of the commoditized work may be increasingly relegated to paralegals and legal assistants, companies will still need lawyers. Although many paralegals are skilled in certain legal areas and procedures, they are not necessarily experts regarding complex legal questions. Just because a nurse can take provide a great procedure, it does not mean that a nurse can take over a patient’s care. Companies trying to save money by relying primarily on paralegals to handle matters from beginning to end, and to respond to all client questions, without attorney supervision would be a recipe for disaster. This is not rocket science. If you check into a hospital for heart surgery, you want to be operated on by a skilled heart surgeon, not by a registered nurse or a therapist.
Lawyers will still be required to oversee matters, especially those with strategic implications, and will be able to do so more cost effectively in-house rather than as outside counsel. However, in-house lawyers will need to do more to demonstrate their value and contribute the bottom line. In addition to providing excellent legal services, they will need to be increasingly more strategic by identifying growth and revenue opportunities, while minimizing costs.
Also law degree and law firm experience are no longer enough to make the cut. The lawyer that has spent five to ten years with a big law firm doing sophisticated work may find it challenging to land an in-house job. Many of today’s in-house lawyers have a broad multi-area practice, industry-specific experience, an M.B.A.’s, tested management and budgetary skills, and broad international experience. In other words, versatility is key. While many companies will turn to less expensive alternatives by hiring more paralegals and contract managers, lawyers will still be in demand. However, they will to be more accomplished and well-rounded than before, for in addition to facing increasing peer competition, they will now face less expensive alternatives that will look very tempting to many organizations focusing on short term solutions and easy ways to cut cost.
2012 In-House Report: Salaries & Hiring Trends
InsideCounsel has released its hugely popular “2012 in-house compensation report,” discussing compensation, the hiring forecast, hot trends, and what it takes to land an in-house position, and how to succeed as in-house attorney.
Companies Are Hiring, But Selectively
The good news is that companies are hiring, the bad news is that they are only doing so very selectively. With the economy finally on the upswing, law departments are looking to hire new help. But experts caution that companies aren’t necessarily hiring attorneys.
The bulk of the hiring seems to be dedicated to paralegals and contract managers. When it comes to hiring attorneys, the numbers are still very low, and the competition very stiff.
Who’s Getting Hired: Standout Experienced Business Lawyers
Companies are most interested in mid-level and senior lawyers with four to nine years of experience. Additionally, they’re seeking jack-of-all-trades attorneys who can work independently.
Being a lawyer that delivers high quality services is no longer enough to land an in-house job. Today, lawyers hoping to get hired by a company need to show that they understand the company’s business and can contribute to its bottom line.
A law degree might no longer be enough. Today’s, in-house lawyers have to understand financials, business strategies, and need to be able to wisely manage projects and budgets. Many are now armed with M.B.A.’s to deliver just that.
One thing is clear: As companies emerge from the recession and slowly increase their legal hiring, attorneys searching for new careers must stand out among the competition. That often means being armed with more than legal excellence to do so.
Advice to Young Law Grads: Start with a Firm and Network.
The vast majority of corporate legal departments are still steering clear of recent law graduated. What can a recent law graduate do to improve his or her chances at landing in-house? The solution: try your hand at a law firm position first, focus on transactional work, stay there for at least five years, and network aggressively.
Base Salaries Slightly Up by 3.3%
2011 has brought moderate increase in in-house base salaries. According to the 2011 HBR Law Department Survey, the average base salary increase among all legal department staff levels in 2011 was 3.3 percent, up from an average increase of 2.6 percent in 2010.
The Bonus Is the New Gravy
The 2011 HBR Law Department Survey found that the average bonus increase among attorneys was an astounding 25.7 percent. The average cash bonus for all attorney levels was $67,000? What does it take to earn those bonuses? Today’s in-house lawyers are held accountable for the level of performance and their contribution to the bottom line. By the same token, they’re asked to share the risk of their companies’ performance. So, in-house lawyers have to meet their objectives, and contribute to the company’s bottom line to expect to get some gravy on top of base.
What’s Hot: Management Skills, IP, M&A and Compliance
The most in-demand practice areas: transactional (M&A), IP, labor and employment, and compliance. In terms of industries, health care and pharmaceutical are generally offering higher salaries.
The hottest skills required from in-house lawyers aside for outstanding legal and business skills, are management skills. Knowing how to manage projects, people, and budgets is key to increasing one’s value in-house.
Trends of the Future: International Expansion and E-Discovery
As companies are pushing for international expansion as a competitive strategy to expand their core business and increase their market share, so are corporate legal departments. Today, many clients are looking to hire in-house attorneys for their international operations, with a focus on Asia, South America, and India.
E-discovery is also very much in-demand. Companies are looking for lawyers who can effectively manage e-discovery and document review with a smart process that saves money.
What can we take away from this report? Lawyers with any hopes to succeed in-house need to be able to bring value beyond outstanding legal skills and experience. Contribution to the bottom line is what it’s all about.
In-House Job Search: Are You Too Junior?
The lateral job market between law firms and corporate in-house legal departments is a tale of two cities. What law firms are finding attractive in a potential candidate can sometimes be quite the opposite from what corporate legal departments are seeking. One of the best examples is experience. While attorneys with three to five years of experience are considered “hot” commodities by law firms, the great majority of corporate legal departments give them the cold shoulder.
The sweet spot for law firms that are hiring is three to five years of experience. There are several reasons for that. First, law firm associates with three to five years of experience have the highest level of attrition. According to statistics released by The National Association for Law Placement, almost 80 percent of attorneys at large law firms no longer work there five years later. The reasons for this high rate of attrition are varied. They include disillusionment with law firm life, not “cutting it,” being in a practice area that is drying up, or simply realizing making partnership is an unlikely goal. Whatever the reason might be, large firms hire significantly more associates than they plan on keeping for the long-term. Therefore, law firms are always on the lookout for talent to replenish these classes.
The other reason law firms have a strong appetite for attorneys with three to five years of experience has to do with their profitability. At this level of experience, associates can tackle more complex work with little supervision at a relatively affordable hourly rate. Whereas law firms claim to lose money on associates during their first three years of practice, they have plenty to gain once these same associates have been trained and can handle the bulk of the work partners are bringing in. They are instrumental to a law firm’s profitability.
When it comes to in-house legal departments, the story is quite different. Corporate legal departments are generally not interested in attorneys with three to five years of experience. Of course, there are always exceptions that prove the rule, but what we are discussing here is the rule, not the exception. Traditionally, corporate legal department are seeking experienced attorneys, with at least ten years of experience to join their ranks. The most sought-after candidates are transactional attorneys with strong business acumen, who can get up to speed quickly, understand operations, and deliver results in a fast, practical, and efficient manner.
Corporate legal departments are not good training grounds for junior and inexperienced attorneys. Corporate legal departments expect their attorneys to have a strong depth and breadth of knowledge, work independently, and with few resources. Generally, they are seeking attorneys who have developed a solid understanding of their industry, which also comes with practice experience. Sometimes, companies advertise for less-experienced lawyers who have been practicing for five to seven years. This is typically driven by a need to hire experienced candidates, but at a reduced cost. Attorneys with five to seven years can usually deliver the type of work handled by in-house legal departments, but they are generally less expensive than their more experienced counterparts. That said, more often than not, attorneys who are more experienced than the position requires fill these same positions.
What does this mean for junior-level attorneys with three to five years of experience? It’s typically best for them to hold off on their in-house search for a while. There are several reasons why they should wait. The most obvious one is demand. There simply isn’t much of a demand for junior attorneys in-house. Junior attorneys need to be patient and wait before trying to make a lateral move in-house. We are not likely to see an increase in demand for junior-level attorneys in-house, even if the economy picks back up. Attorneys thinking about going in-house should focus on developing their practice skills, business sense, and industry-specific knowledge. Attorneys typically start being marketable in their fifth year, and have more available options starting in their tenth year in practice. In the meantime, cultivating skills, until the optimum time has come to begin an in-house job search, is the best way to prepare for that type of lateral move.
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