Biglaw, Layoffs, Outsourcing, Staff Layoffs, Technology

Nationwide Layoff Watch: The Upside Of Outsourcing?

Which top-tier law firm is conducting staff layoffs due to outsourcing -- and could this be a good thing in the end, for both the firm and the employees?

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When it comes to Biglaw word-processing jobs, Williams Lea is the grim reaper. As we’ve chronicled in these pages, numerous leading law firms have outsourced their word processing and proofreading functions to this prominent provider.

This has led to layoffs — lots and lots of layoffs. Some affected employees have been sad, and some have been angry. One complained of the “callous disregard for the welfare of long-time Foley [& Lardner] employees” that a Williams Lea takeover displayed.

But could these changes be beneficial — not just for law firm bottom lines, but for the affected individuals? The latest law firm to outsource its WP and proofreading functions, one of the most prestigious and profitable firms in all the land, makes the case….

Earlier this week, Cleary Gottlieb announced that it would be outsourcing its New York word processing department to Williams Lea. We understand that the move affects approximately 50 employees and will take effect in May 2014. Severance is being offered, sources report:

Everyone in the Department will be given $5,000 and 2 weeks pay for every year of employment up to a maximum of 52 weeks. People were told that they can apply for positions with Williams Lea…. Anyone accepted to work with Williams Lea will not be eligible for the 2 weeks pay for every year of employment, but will receive a flat payment of $10,000.

How are Cleary staffers reacting to news? We heard that some people were upset (e.g., crying), but others appreciated that this move was done openly (since there have been allegations of stealth layoffs of support staff at Cleary in the past).

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We reached out to Cleary for comment. The firm provided this statement, through a spokesperson:

After careful consideration and in an effort to bring enhanced services, greater efficiency and broader expertise to our New York word processing functions, Cleary Gottlieb Steen & Hamilton LLP will transfer the management of those operations to Williams Lea, the well-regarded office services provider, by early May 2014.

The transfer of oversight to a company that specializes in this area will improve our ability to meet the needs of our lawyers and clients, and to ensure that our word processing services keep pace with advances in technology. Additionally, Williams Lea can offer a wider array of training and development opportunities for its staff members.

We are providing financial and other forms of support to help make the transition as smooth as possible for the impacted word processing employees who, through their hard work and dedication over many years have made valuable contributions to the Firm:

  • They all will have an opportunity to apply for jobs with Williams Lea, in our New York Office.
  • Those who stay in their positions through the transition, whether or not they become Williams Lea employees, will receive a retention payment.
  • Those who accept jobs with Williams Lea also will receive a transition payment.
  • Those who stay with the Firm through the transition but don’t join Williams Lea also will be eligible for a generous severance package and outplacement services.

To look on the bright side:

  • Cleary staffers can apply for jobs that will remain in New York. So this isn’t a case where people would have to move far away to keep their jobs. In fact, commutes would remain unchanged, because Williams Lea will be running the operation out of Cleary’s offices.
  • “Williams Lea can offer a wider array of training and development opportunities for its staff.” This is a fair point too. One could argue that law firms should focus on practicing law, and leave support functions like word processing to focused, dedicated providers like Williams Lea.
  • Payments are being made to the affected staffers, whether or not they eventually join Williams Lea — which is generous, one could argue, because people who end up working for Williams Lea haven’t really “lost” that much in the transition.

If the new positions paid a lot less, that might be a different story. But one source familiar with the situation advises us that current Cleary staffers who join Williams Lea will receive compensation and benefits that are comparable to what they currently get at Cleary.

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So, in the end, this doesn’t seem that bad. Cleary appears to be handling the situation in an open, transparent manner. Severance or transition payments are being made to affected individuals. And a company with greater expertise in word processing and familiarity with the latest technologies and processes is taking over these operations, which over the long term should (hopefully) result in improved — or at least more cost-effective — service.

At least that’s how things look from where we sit. Are we missing something? If so, feel free to opine in the comments, email us, or text us (646-820-8477). Thanks.

Earlier: Nationwide Layoff Watch: Outsourcing Claims Additional Law Firm Jobs

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