Law firms have for decades reached outside their companies to hire lawyers to work on special projects for periods of a few days to a few months at a time. Much of that work has been in document review, with independent lawyers hired to sort through reams of paperwork. Since a firm contracts only on an as-needed basis, it is a good way to manage costs, and it frees up a firm’s higher-paid associates to focus on more lucrative business.
But now, contract lawyers with a wide range of expertise are available in ever greater numbers, which is good news for small firms that aim to compete against the bigger players.
“It’s a great way to be able to accept work you would normally have to turn away because you lack the human capital or the expertise,” says Leslie Firtell, CEO of Tower Legal Solutions, a New York-based company that provides these independent lawyers. “It allows smaller firms to play in the same sandbox as the bigger ones.”
Where are all these freelance lawyers coming from?
In years past, lawyers who were solo practitioners often went that route because they hadn’t made partner at a firm or because they had recently finished law school and hadn’t yet landed a full-time job. But the pool of contractors, and the range of work they can handle, has been growing as more lawyers choose to go freelance because of lifestyle or financial considerations.
More than a year of working (and overworking) from home has persuaded some that they can do better as independent contractors. After years of long hours at firms, which typically take it for granted that associates will work through the night when called upon, lawyers are looking at their options. And money may not be the chief concern for many. Some 78% of lawyers said they would choose the flexibility of working from home over a 10% pay raise, according to a survey of 600 lawyers from firms across the US by the online news site Above the Law.
Finally, as with other sectors, those in the legal profession have discovered that work done remotely is often as good as work done in the office.
What’s driving demand for contractors?
The increased supply of legal contractors has been well-timed for the industry. Firtell says the demand for contract lawyers is greater than it has been since the second half of the 1990s, when the market for legal services rebounded and law firms discovered they needed all those junior associates they had laid off in the wake of the 1990 recession.
In the wake of the pandemic, the number of associates at US law firms was down more than 20,000 at the end 2020, according to Thomson Reuters’ Peer Monitor Index (pdf). But legal work and the demand for lawyers has been surging with the rise in mergers and acquisitions and capital markets activity, to cite two areas. According to the legal market data provider Leopard Solutions, hiring for lawyers this year is up 150% compared with early 2020.
Law firms of all sizes that find themselves shorthanded are suddenly willing to have their contract lawyers handle more substantive matters, like working on mergers and acquisitions. And according to Firtell, this new generation of contractors can oblige. “The range of experience among these freelance lawyers is deeper and broader than ever,” she says.
That’s a particularly valuable development for smaller law firms, which can lean on contractors to broaden out what they can provide to clients.
“A small firm might have a client for whom it does one kind of business—like a litigation boutique firm—then its client is embarking on acquiring a company and needs advice on M&A. This is a way for a small firm to serve its client while also building its book of business,” says Firtell.
“But before turning to hiring a contract lawyer, you need to define what skills you’re looking for, what experience. You want to be ready to divvy up tasks. Then you interview the attorney. In some ways it’s like hiring for staff. Clients come to us because they need extra help—they’ve gotten a new case, someone is on parental leave or there’s a special project.”
An agency like Tower will send the freelance lawyer’s resume to the law firm, which will then interview the attorney. “We make sure the lawyer is a member of the bar in good standing and that there are no conflicts of interest,” says Firtell.
Solo practitioners using solo practitioners
Even a one-person operation can make use of contract lawyers. Andrew Abramowitz, who has had his own law practice in New York since 2010, says when he struck out on his own, he “did not have a plan but imagined I might hire an associate or take on a partner. But things came together in a different way.” Instead, he made use of freelancers, paying for help by the hour rather than hiring a full-time associate with a salary and benefits.
Some contract lawyers work through agencies and some are independent and work directly with law firms. Abramowitz makes use of both types. “Solo lawyers sometimes do it all themselves, but you can run into difficulties with bandwidth when trying to do it all alone,” he says. “I assemble a team as needed.”
Abramowitz has a small network of independent lawyers he works with regularly, but will also sometimes turn to agencies like Firtell’s for contract lawyers. “They can be helpful in drafting an agreement—for instance a case of a company being sold or a stock purchase agreement. They will have the first crack at writing the agreement, and then I will edit it,” says Abramowitz.
“I am not gunning for the biggest kinds of projects, like a high-profile IPO,” Abramowitz says. But working on this project-by-project basis means, “when talking to prospective clients, I emphasize that I have this bench of lawyers—of talent—I can call on.”
Law is a complicated business, which is why lawyers specialize. A lawyer versed in maritime law is the one to tap if your client’s ship has been arrested but hardly suitable if that client is pursuing an acquisition. Subcontracting specialists increasingly is the answer, even for the smallest firms.