Biglaw, Billable Hours, In-House Counsel, Partner Issues

Buying In: An Interview with an In-House Insider (Part 2)

The Anonymous Partner speaks with an In-House Insider about the value of junior associates, work-life balance, and other issues.

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Last week I spoke with an In-House Insider, a Biglaw refugee turned in-house counsel. You can see what our Insider has to say about the state of Biglaw and client relations here and below.

As with the initial installment, the only changes I made to the Insider’s words were those done to protect their identity, and the Insider was given the opportunity to revise their points once I added the questions and commentary.

Again, I thank the Insider for the candid observations and thoughtful opinions on these core issues. Now, on to the discussion….

AP: Thanks again for taking the time to provide your thoughts to ATL’s readership. Have you kept up with the Biglaw goings-on since moving in-house?

IHI: Not a problem. I can provide input on these things to you so long as it is done on a confidential basis. I must admit that I don’t turn to ATL as much as I did in my associate days (and especially not since I left firm life), but nonetheless I think it is a great outlet to share views on the development of our profession. From an in-house perspective, it is always good to stay in the loop on developments in firm life, and ATL also provides fodder when I talk to my old firm colleagues.

(AP: More evidence that ATL is a must-read for those who follow Biglaw and the legal profession generally.)

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AP: Now that you are in-house, what do you think about the current state of associates in Biglaw?

IHI: Regarding your discussion of associate structures, that is a really tough one given current market dynamics and something on which I have mixed emotions, given the benefits I received when allowed to cut my teeth on substantive client work right from the get go. I came out in the mid-to-late ‘90s when firms needed lots of warm bodies to handle the ever-rising volume of work. I got the typical trial by fire which I imagine you got as well (I assume we are roughly the same age and law school vintage). Really was able to develop my skills from day one. Billing rates were much lower (rationalized to the value proposition for a young associate). My billing rate was not much more than a paralegal at the start (imagine my salary probably was not much more either). Then of course the salary wars ensued and rates kept going up and up (those were the days). From where I sit now, junior associate work is not worth the sticker price firms try to charge (and in my opinion this rule applies across jurisdictions). So in response many clients prohibit or discourage juniors (generally 1-3 years) from working on matters, which I think is wrong as well.

There are some things that junior associates can do effectively and efficiently, but the value proposition must be there for us as your clients. We are not in the business of paying to train your associates. We are in the business of creating value for our shareholders, and our in-house legal team exists to enthusiastically serve our commercial team with high-quality, effective legal services in support of the company’s global business strategies and objectives in a cost-effective manner.

(AP: For me, this answer clearly shows the moderate nature of In-House Insider’s views. I have definitely heard directly from some clients that junior associate time is worthless from their perspective. Other clients, including those that allowed me to work on their matters when I was a junior associate, are more concerned with top-level costs than the experience level of the person doing the work.

What is interesting about Insider’s position is that this moderate outlook with respect to junior associate level work (and its value) is tempered by a rock-solid belief that Biglaw firms today are charging inflated prices for junior associate time. The latter point is one that is hard to argue with. At the same time though, in this age of deflated associate classes (bodies-wise) and ever-longer partnership tracks, the idea that firms depend on clients for “paying to train” associates is a bit anachronistic. It is far more likely that I have staffed an entry-level associate on your matter for budgetary, rather than training, reasons. That said, I have always thought that how a firm staffs a particular matter says a lot about its estimation of the client’s importance.

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I think Insider’s company is a big enough client of the Biglaw firms they frequent that he is fairly insulated from some of the more egregious “team compositions” I have seen over the years. Any Biglaw client being subjected to a rotating carousel of first-years should immediately take the hint, and move their business somewhere it would be more appreciated.)

AP: Is in-house life the promised land it sometimes seems to be to those grinding away in Biglaw? It must be nice to have Biglaw firms at your beck and call.

IHI: Another thing to consider on this topic is the impact the external service provider has on the life of the in-house folks. I am one person in a worldwide legal group of a few dozen lawyers with primary day-to-day responsibility for our corporate business development initiatives spanning multiple continents, a large section of corporate matters. I wake up usually around 6 a.m. to a raft of e-mails that came in on projects overseas during the night, spend about 10 minutes with my young kids before I go to work and maybe get to see them for a bit before they go to sleep if I can get home from the gym in time. [Since you] have kids, I am sure you are in the same boat. Then there is the travel (for me several trips a year usually overseas)

I am not complaining (in fact I really like my position), but I underscore the point that in-house folks work just as hard if not harder than some firm lawyers, and we do not have near the same degree of the support apparatus that a lawyer in a large firm has (after hours admin, WP, copying, etc.). So we encounter the same work-life issues you have in a firm environment. I assume that you see our reality with your client interactions, so you know where I am coming from. External counsel support is integral to enabling our in-house legal function (i.e., you folks allow me to perform my responsibilities effectively, make my life easier and allow me to see my spouse and kids). Some companies keep just about everything inside but they have in-house legal departments that would rival many global law firm platforms.

(AP: Insider’s perspective closely mirrors that of many of my former colleagues who are now in-house. It is a different ballgame, but the keys to success are very much the same as those required to succeed in Biglaw, namely, commitment, willingness to sacrifice, and the ability to self-motivate. As a Biglaw partner, the point I gravitate to in Insider’s comments is a simple one. My job is to make my client’s professional (and by extension personal) lives easier — Biglaw’s raison d’etre, clearly reiterated by a customer. We should never forget it.

Next week, we will hear more from our In-House Insider on where Biglaw firms need to improve, and what they can do to really cement their relationships with clients. In the meantime, let me know your thoughts by email or in the comments below….)

Anonymous Partner is a partner at a major law firm. You can reach him by email at [email protected].

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