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Legal Cost Containment – No Payment for Work by 1st Years

by Editors on October 18, 2011

Legal cost containment doesn’t just mean giving your in-house team more work:

Corporate legal departments are beginning to take a hard line on costs these days, and one of the first places they’re cracking down is in paying for the high hourly costs of first- and second-year law firm associates.

[via: Corporate legal departments refusing to pay for work by first-year associates at InsideCounsel]

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Jason Winmill October 19, 2011 at 3:13 pm

This article raises a complex question with an answer that depends on many factors. In this case, it seems clear that big law has done a poor job providing their clients with attractive solutions.

Everyone recognizes the need to train recent law school grads to become effective attorneys. The issue of the worth of these professionals raises a deeper question: How should the cost burden of training junior attorneys be shared between law firm and client?

Our consulting firm, Argopoint, works with GCs across a range of industries who seek better value from outside counsel legal services. Our experience suggests that one-size-fits-all solutions, such as not paying for junior attorneys, may not always be the best solution.

As the market for legal services becomes more cost-sensitive, law firms that can appropriately price out junior attorney services should experience growth. Firms that remain out of touch with clients’ economic concerns are likely to see business relationships diminish.

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