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Summer’s just around the corner, and the need to slim down is on just about everyone’s mind. With corporate earnings shrinking to the size of string bikinis, companies nationwide have gone on crash diets, shedding jobs by the pound. But in the midst of massive layoffs, company lawyers are holding on to their positions — at least for now. We didn’t have much luck getting GCs to go on the record. After all, no one wants to hold out false hope or send tremors by admitting that layoffs may occur in the future. So we asked those in the know: headhunters. “People in the middle executive level are being cut,” says Michael Waldorf, president of Los Angeles-based legal search firm Waldorf Associates Inc., referring to the thousands of corporate job cuts that have been announced. But, he says, “there aren’t a whole lot of midlevel people in corporate legal departments.” Some companies’ recent layoff statistics back him up. The Goodyear Tire & Rubber Company, which is planning to eliminate 7,200 jobs worldwide during the next two years, says its cuts will not extend to the legal department. Similarly, Lucent Technologies Inc. says it expects that the company’s 10,000 job cuts through layoffs and attrition will have only a minimal effect on its lawyers. Consultants say that in-house lawyers are staying above water for a variety of reasons. For one, large companies “pretty much always keep lean and mean legal staffs,” according to Lynn Mestel, president of New York attorney search firm Mestel & Company. So there usually isn’t much fat in the legal department to trim. Also, company lawyers tend to be highly skilled in specific, narrow practice areas, which increases their value to employers. “When we hire in-house legal counsel, it’s a long-term investment not subject to change unless there are extraordinary circumstances,” says an employee at one of the largest financial services companies. Additionally, in a troubled economy, the need for inside lawyers can even increase. “If anything, corporations need more employment lawyers,” says Alisa Levin, a legal consultant at New York-based Greene-Levin-Snyder. Linda Kline, of New England Legal Search, adds that companies also recognize that keeping lawyers on staff allows them to save money on outside counsel fees. All of this doesn’t mean that in-house lawyers are completely immune to the slowing economy. If nothing else, corporate legal departments are driven by business. When things are busy, lawyers are added. But if business slows — and an entire business line is cut — the lawyers who support that part of the business will be eliminated, too. But while vast numbers of lawyers aren’t being terminated, very few enterprises are actually expanding their legal departments right now. “In this climate everyone is more conscious than ever about head count,” says Levin. “The thought of adding lawyers just isn’t there.” This, coupled with the fact that lawyers at companies have stopped fleeing to dot-coms, and that hiring at firms is down, has significantly intensified competition for existing in-house positions. The trend toward consolidation in the banking industry has eliminated some jobs and pushed corporate counsel out of work, too, according to Mestel. Bank mergers tend to cause “shifts in power” and “overlap,” she says. “My experience has been that when there is a shift in power, there is a shift in staffing,” says Mestel. She adds that, so far, any lawyer she’s come into contact with who has recently lost his job from a corporation has been let go as a result of a merger. She admits that if the economy continues to slow — and more companies cut their staffs in order to get operating costs in line with revenues — corporate counsel could become victims of layoffs. Motorola Inc. is a reminder that there is always an exception to the rule that skinny departments can avoid cuts. A spokeswoman for the company, which has plans to eliminate 26,000 positions worldwide, says that while Motorola’s 190-lawyer legal department is slightly leaner than most corporate law departments overall, some lawyers already have been cut. Declining to specify just how many have been let go, the spokeswoman said the lawyer head count is expected to further decline by the end of the year. The company’s stock has skidded from approximately $40 a year ago to about $15 at press time. Motorola is trying to revive its fortunes with, among other things, a wireless instant messaging joint venture with Telefonaktiebolaget LM Ericsson and Nokia Corporation. The good news is that Motorola is just an exception — for now. We’ll have to wait and see if it becomes the norm. COMPANY NAMENUMBER OF LAYOFFS ANNOUNCED Motorola Inc. — 26,000 DaimlerChrysler AG — 26,000 Nortel Networks Corp. — 20,000 Delphi Automotive Systems — 11,500 Lucent Technologies Inc. — 10,000 The Procter & Gamble Co. — 9,600 Compaq Computer Corporation — 7,000

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