The following is a summary of the Chambers Webinar event that occurred on December 3rd 2020, titled ‘The Shape of the Flexible Legal Staffing Sector with Peerpoint and Allen & Overy’.
In a survey by Chambers and Partners that was sent out to roughly 1600 in-house clients across the USA in the last year, every single respondent was reportedly spending money on Alternative Legal Services. A key takeaway from Chambers’ research is how providers were able to harness the global marketplace. Providers shared the key ability to be able to work collaboratively across a global scale; though it is yet to be seen how COVID affects this ability to work globally.
Independent providers such as Integreon and Elevate were identified as the entities who “kickstarted” the harnessing of the global market. In essence, they were the trendsetters for global working amongst ALSPs. Lawfirms themselves are reportedly getting in on the action, with the advantage of institutional relationships, and global coverage.
Reports show that there’s a trend in providers focusing their services on “narrow slices” of the market, attempting to situate themselves in a niche to bolster their competitiveness, and become industry leaders within those niche parts of the market. Specialization has become a very attractive feature of ALSPs it seems.
Interim support in the form of flexible legal staffing continues to be a hot trend in the legal market. Catriona Blamire of Peerpoint/Allen & Overy speaks on how the array of options within FLS (Flexible Legal Staffing) has grown significantly. For example; you can opt for a paralegal resource, to an interim resource GC. For many firms, it might be that 30% of their legal team consists of interim staff, so it’s a key part of their resourcing strategy. The pace at which flexible legal staffing is growing has quickened as well, with 10 new market entries in London alone in the past 2-3 years.
Some reasons identified for why legal teams opt to hire interim support through FLS are:
- regulatory change projects, such as BREXIT implementation
- to “parachute” in help for peaks in busy work periods, through M&A transactions for instance
- for period of leave; parental leave, extended leave, etc
- in permanent hiring periods, while those processes may take up to 6 months, an FLS can offer temporary support so that the hiring period may finish up comfortably and smoothly. And additionally, with some of the hiring freezes many companies are currently under, they may not have the “permanent headcount”, but they have a project budget to get people in to help with particular workstreams. Headcount freezes and restrictions are huge issues in 2020, which are being combated by FLS.
The pandemic has fastratcked many initiatives; with the absence of a need for in-person talent, a huge opportunity for the harnessing of global talent has opened up, as well as the opportunity for diversity. There’s also changes in the areas of demand as a result of the pandemic; high demand in the areas of restructuring, litigation and employment. Additionally there was a demand for shorter length of placements, which were actually ultimately extended by the client. Approximately a 15-20% increase in projects being extended.
There’s a pervasive need to access specialized functions, skills you don’t have in the team. Technology, process, data, etc are some specialized areas that clients are currently looking to access through FLS.
Using FLS is more economically efficient than its TradLaw alternative. Additionally, in the current state of the world under the pandemic, it’s beneficial to staff one’s legal team with interim hires in order to avoid the damage to one’s reputation that would occur if you let a large portion of your permanent team go.
A good reason/tactic identified in the webinar for hiring interim lawyers is being able to bring on flexible legal aid at the end of the financial year, where you have some budget left but you have no resource to tackle those challenges. This is where the hiring of a flexible lawyer would come in handy, especially considering the fact that that leftover budget would likely get lost in the calculation of the next year’s budget.