Downturn May Have an Upside for Contract Attorneys
Emily HellerThe National Law Journal
May 05, 2009
For some contract lawyers, work is synonymous with being a galley slave, performing grunt jobs in stuffy basements or offices far removed from meaningful contact with other legal professionals.
The collapse of the economy hasn't helped the plight of that segment of contract help, which several Internet blogs have well documented. With widespread large law firm layoffs, more lawyers are desperate for work and willing to work for less.
At the same time, law firms and legal departments that may be short on cash in the downturn are taking advantage of the cheap help by recruiting attorneys for the short term.
But the economic turmoil also has stirred up positive changes to traditional contract services, creating some new twists on the temporary attorney industry.
"Law firms are re-imagining how to use lawyer talent," said James Leipold, executive director of the National Association for Law Placement.
Clients are telling their firms that they don't want to pay high hourly billing rates and that they want less expensive co-counsel, he said. But because law firms are still contemplating the way forward, it's too soon to know how it's going to shake out.
"Different firms find different solutions. There could be some wins for contract lawyers in that re-structuring," he said. "I think it'll have an impact on contract lawyers. We just don't know what kind."
Firms will begin trying different staffing models, said Michael Gotham, director of attorney recruitment and retention at Seattle-based Perkins Coie.
"I think we are going to see a lot of experimentation," he said. "How quickly that moves, how broadly change happens and even what direction it goes is uncertain."
Although there may be uncertainty, the contract workers' role has changed and demand is growing, said Joe Ankus, a law firm recruiting consultant at Ankus Consulting Inc. in Fort Lauderdale, Fla.
"What you are seeing is flexibility on both sides of the equation," he said.
Still, it is largely a buyer's market right now. Hourly rates for contract lawyer pay in New York and Washington, D.C., have dropped to $30 to $32 from $38, said Gregory Bufithis, founder of The Posse List job-posting Web site for contract lawyers.
If someone balks at $32 per hour, someone else will do the work for $28, he said.
INTENSE PRESSURES
Even so, the same intense economic pressures hitting some full-time lawyers have created new opportunities for contract lawyers, particularly those with an entrepreneurial bent and an eye for an unfulfilled niche.
A growing community of contract lawyers is working as freelancers for law firms or corporations. They have found service niches and their calling cards are lower costs and higher flexibility.
Since 1996, Lisa Solomon in Ardsley, N.Y., has practiced as a contract lawyer assisting small firms and solo practitioners with research and writing for civil cases. She's an "inside" lawyer who drops into firms and cases as needed but doesn't work with the firms' clients.
Small firms and solo lawyers are feeling the same pressures as bigger law firms to reduce their bills, she said. They can use contract lawyers to staff up for a big case or big client without bearing the overhead.
With lots of lawyers looking for work, Solomon is busy coaching and training other lawyers who want to work independently.
"Business is growing," she said. "There is a demand."
Lawyers need "to figure out a way to provide services in a manner that fits the marketplace," Solomon said. "It's just that people might be looking for ground chuck instead of filet mignon. People still have to eat."
Demand for staffing agency lawyers is up, particularly in litigation, intellectual property, bankruptcy and foreclosure work, said Charles Volkert, executive director of Robert Half Legal in Menlo Park, Calif.
There is "an uptick in the number of candidates coming through our doors" and increased demand from law firms and corporations, he said. He declined to give specific statistics but said that project work and project attorneys are more numerous than they were one year ago.
On the other hand, freelance lawyering is "an entirely different animal" than typical contract lawyering, said Melody Kramer, a freelance lawyer and San Diego solo practitioner who co-founded the National Association of Freelance Legal Professionals about a year ago. The organization has 450 members in 18 countries.
It's like being an associate for hire, writing motions and briefs and preparing for depositions and court hearings, said Kramer, who has freelanced since 1994.
"I have had more work than I know what to do with," she said. "I think the market is perfectly primed for freelancing right now."
One-time lawyer Bufithis has seen his business evolve as the legal services market has changed. In 2002, he created a clearinghouse for contract lawyering job leads. Working as a contract lawyer, he and colleagues began sharing information about possible jobs. Word started to spread, and a friend of a friend said he wanted to join the "posse." That gave a name to Bufithis' job-posting Web site, The Posse List, which has surpassed 14,000 subscribers, he said.
Bufithis has just launched a sister Web site -- The Posse Ranch -- to help contract lawyers go solo. He has a third business, Project Counsel, a European-based attorney referral and staffing agency.
Staffing agencies pay Bufithis annual subscription fees to post their jobs and projects. He also maintains a law and consulting practice in bankruptcy and corporate restructuring.
LANGUAGE SKILLS IN DEMAND
One of the most in-demand contract lawyering jobs calls for special language or dual nationality -- assets that are helpful with cross-border litigation, transactions and investigations, Bufithis said.
Add international document review to that list, said Lyzka P. DeLaCruz, who founded a firm, Bakker DeLaCruz, in 2007 with partner Filip Bakker. "It's really just started to boom for us," DeLaCruz said.
If a large multinational company needs attorneys to review documents in another language, it would pay a staffing agency, which then would pay lawyers to do the work. DeLaCruz and Bakker, fluent in five languages between them and with lots of connections to other international attorneys, charge less than a staffing agency would, she said.
DeLaCruz doesn't see her firm as replacing the agencies, with whom she professes a good relationship. There is a place for both arrangements, she said.
Many laid-off lawyers are launching solo practices as their next steps. A solo practitioner and a legal freelancer have the same business requirements, among them marketing, taxes and insurance. "You have to want to run your own business -- your own solo practice," contract lawyer Solomon said.
Freelance lawyers have to do the legwork to get jobs, but there is a benefit to working for yourself.
"I wanted the flexibility to work where and when I chose," Solomon said, adding that here is no stigma to entrepreneurial contract work. "Believe me, I'm proud of what I do."