Why Are In-House Legal Departments Turning to Temporary Attorneys?

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  • From telecommuting to flexible hours, the workplace is changing.
  • In fact, freelancers are more the norm than ever within many companies.
  • This is also true for in-house legal departments who have now turned to hiring temporary attorneys.

Summary: What are the advantages of being an ad hoc lawyer?
Is the trend to be an ad hoc in house attorney the right move for you?

The current workplace is seeing a widespread shift from traditional in-house staffing to include more variable staffing. The changing tides are sweeping a multitude of industries--most famously writing, web development, and virtual administration--but we are now seeing a blooming trend of highly skilled lawyers taking on a flexible work style. What is causing this part of the workforce to abandon old roles? And will this change be good for the employer, the worker, or both?
The Role of Ad HocTM Counsel Within In-House Legal Departments
Definition: Independent professionals are hired on an Ad Hoc (as needed) basis to support business operations. In this article, we are focusing on the legal department’s use of these professional relationships.
In-house legal departments provide a valuable service to corporations, as they possess internal knowledge of the company and can conduct a wide range of necessary legal activities. Operating under a business model, in-house departments seek to cut costs when possible, while doing their best to go above and beyond their duties for the company.
These legal branches are invaluable to large corporations. So much so, that they have been ranked due to their successful strategies. Corporate Counsel released their top picks for Best Legal Departments in 2015, assessing potential winners on “innovation, a sense of community, [and] even a bit of swagger.” The lucky winners were:
  • Wikimedia Foundation
  • Office Depot
  • Marriott Vacations Worldwide
  • Intel
According to Corporate Counsel, they chose the winners based on a track record of success and a desire to constantly improve their department.
Operating a corporate department involves evaluating and identifying budgetary needs, as well as optimizing current spending. In-house attorneys discussed problems they encountered when they felt stuck executing smaller tasks and couldn’t focus on the larger issues. Department heads tackled the adjusting labor needs with contract employees, also known as ad hoc counsel.
Why Are Lawyers Turning To Flexible Jobs?
Findings from the Bureau of Labor Statistics show that in 2015 there were 15.5 million people labeling themselves as self-employed, contract workers, or temporary employees. The number of these workers in the United States is set to expand, with over 40% of the workforce estimated to be labeled as independent workers by 2020. The reasons for a move towards an alternative work schedule most commonly fall into one of these categories:
  1. Schedule Freedom
Freelancers and contract professionals are free to set their own work hours. With no managerial oversight, each worker can take on as much or as little work as they feel comfortable with. This translates well for parents, travel enthusiasts, or anyone who doesn’t like to wake up early.
As a single parent, the opportunity to schedule work around your children is enticing and hard to pass up. If you are having a child and you need a reduced work schedule, contract work can feel like a miracle.
  1. Advancing Technology
It is no secret that technology is advancing more rapidly each day. Nearly all professionals currently own or have access to a laptop or home computer. With apps like Slack, Google Docs, Online Pipelines, and more, it is becoming viable for employers to monitor work from a distance.
  1. Career Advancement
Working on a project or contract basis ensures that employees can take on tougher projects as they become more comfortable. Even after you establish yourself as a reputable worker, you have to continually progress in your professional development, or else you will quickly fall behind the competition. Many variable workers enjoy the competition and encouragement to improve.
When operating as part of a large company, it can be difficult to get a raise or a promotion. In contrast, contract work regularly offers a rate in the form of projects with increased dollar value. As long as a professional has prospects of a higher paying job, it is up to them to pitch their worth to their new client and potentially earn more.
How Can In-House Legal Departments Benefit?
One argument in favor of the recent uptake in contract workers is the influx of great talent. Many of these professionals coming to this market opted for a variant work style due to personal or career-related reasons. Top-tier professionals are now available for hire and they can add invaluable expertise to a project or department. Furthermore, departments can reduce spending, boost efficiency, and create a skilled network of consulting professionals for use in all areas of departmental needs.
  • Reduction in Labor Costs and Overall Budget
At a private law office, a sudden boost in work equals an increase in profit and revenue. This is not the case for corporate entities, where extra work translates to costly extra expenditures. Legal departments across the country are running on slimmer budgets and trying to cut costs where possible. Even the Corporate Counsel took into account management practices and operational strategies when ranking the best legal departments.
Establishing a ready supply of ad hoc counsel allows legal divisions to monitor cash flow and optimize labor costs by only hiring as much labor as they need--in a process called scaling to demand.
Fluctuating industry trends create an unsteady demand for work, which leaves legal branches to deal with the extra workload. Market changes may include things like:
  • Seasonal Peaks
  • Industry Trends
  • Corporate Ventures
  • Product Releases
  • Company Announcements
  • Mergers
  • World Events
Corporations may struggle with the decision to hire on another full-time attorney or to pick up the extra work from within the department.
 A great solution is to outsource this work to your trusted network of legal aid that will only be paid to complete work on that project. Options to pay these types of contracts include paying hourly or a fixed project fee. In this way, businesses are able to align budget and company requirements.
  • Scalability and Variable Rates
Top tier professionals available for contract work may seem expensive, but the nature of the freelance market ensures that there will always be a wide selection of professionals with different specialties, rates, and skills. Companies are able to choose staff based on budget limits and project needs.
Hiring ad hoc individuals has become easier with technology and the higher demand for these types of contracts. Employers can go online to any of the following freelance websites and hire a professional within minutes:
  • Freelancelaw
  • Montaglegal
  • Guru
  • Upwork
In the process of filling a position, you can filter through potential candidates by rates, experience, and specialties. There is no limit to the scalability of ad hoc staff with such an easy process.
  • Expansion of Internal Resources
Ad Hoc counsel is in not a replacement for general counsel within the organizational structure. The general counsel performs its responsibilities with a focus on productivity and efficiency. In a complex business environment, it is highly likely that staff will encounter a broad range of tasks, projects, and issues. And by calling upon readily available consultants, the business can focus on general duties while their hired experts work within their specialties on assigned projects.
By allocating this extra work to outside contractors, the company is able to refocus their leading counsel members on critical internal affairs. We see this smooth out general operations with the added benefit of a more strategic approach to individual legal problems.
  • Diversity
It’s no secret that workplace diversity has been shown to boost productivity and worker morale. A study by Glassdoor confirmed that 57% of workers felt their company should do more to diversify the workplace. While most diversity initiatives take place within the human resources department, it is becoming more common for other department heads to lead the way with their own processes.
Not only do companies benefit from the boosted work productivity, they also benefit with potential recruiting efforts by building an inclusive reputation. Over 67% of survey participants noted a diverse workforce as a key factor when evaluating job offers.
In addition:
  • Diverse teams are more productive. Those who split work between men and women evenly secured 41% more revenue.
  • Creative Ideas flourish. Ideas that differ from the rest of the group are more likely to be considered and utilized in a diverse group setting.
  • Diversity breeds diversity. Wide arrangements of teams attract a more diverse set of applicants to company positions.
Is There a Good Time to Hire Ad Hoc Individuals?
Yes there is! As you will see below, contract hires can be largely effective during large company changes or structural attempts to curb spending. Department leaders should take a look at their hiring processes to see if there is room for improvement or cost reduction.
Business Growth
Accelerated company growth can make it difficult to forecast labor needs during the influx of work that comes with the new business. Relying on ad hoc services means that departments can fill temporary business needs with experienced professionals until a steady stream of work can be established and long-term needs determined. With this strategy, you are able to avoid costly mistakes such as over-hiring for salaried positions.
Moreover, there are several additional legal processes that must be considered when merging businesses. Contract workers can help with the paperwork associated with a large company restructuring.
Legal Discretion
Part of running a large corporation is embracing the likelihood that you will run into legal issues. For example, an unusual situation that is set to go to litigation will require a team of lawyers to attend to the case. If you use general counsel to attend to these rare occurrences, the productivity of in-house operations will drop as their attention is directed elsewhere.
Utilizing a team of ad hoc attorneys significantly reduces the decrease in productivity in-house and enables general counsel to focus on critical daily activities.
Stabilization of Internal and External Spending
Human resource departments must manage a delicate balance between hiring more full-time employees (making budget increase requests) and using outside counsel. Ad hoc counsel may work as a perfect solution by filling in work gaps with cheap efficient labor.
After a period of time gathering data, the organization may realize that it does have enough work to bring on salaried staff and ad hoc counsel can easily be reduced.
Final Thoughts
As corporations grow, there is a mounting pressure on legal departments to strictly manage operational spending. The most significant portion of cost usually comes from labor costs. In an attempt to curb spending and streamline business operations, organizations are turning to ad hoc counsel to fill gaps in staff. Contract staff members serve as an easy way to hire specific individuals, based on experience and pay rate, for temporary projects.
Utilizing these services is becoming more common due to the increase of technology, as well as a demand for variable work from the workforce. Employees benefit because they can work when they want and at their own rates. The independent workforce is forecasted to grow exponentially in the coming years, so it makes sense that companies would begin to leverage the booming labor pool to their advantage.
Businesses stand to gain happier workers, a more diverse labor pool, reduced departmental spending, an expanded specialist network, and an increase in productivity. It is easy to see why this is a trend with no end in sight!
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