A recent study of legal firms and partners revealed interesting insights into the profession in Australia and New Zealand.
It’s long been acknowledged that a culture of long hours and fast turnarounds in the legal sector has come at the expense of work-life balance – and is simply considered part of the profession.
But work-life balance, workplace culture and conditions have been in the spotlight in Australia recently, particularly when it comes to workload pressures for junior lawyers.
While many firms are working to implement policies and procedures that offer and track more flexibility and balance, the competitive and demanding nature of the legal profession is a constant challenge. Clients often need short turnarounds on high volumes of work as we saw across firms that worked on the recent Banking Royal Commission and the current Aged Care Royal Commission in Australia.
An increased focus on work-life balance amongst firms raises questions around how to drive change. Perhaps we should change the way law firms charge for urgent work, with the proposal of industry-wide surcharges enforced for work performed after a certain hour. These surcharges seek to establish a culture where clients think twice about how urgent or necessary a piece of work really is before briefing their lawyer.
Talent retention
Law firms continue to experience challenges in attracting and retaining talent. The expectation that all partners should deliver a standard number of billable hours over a five-day working week is increasingly becoming a thing of the past. The prestige of a firm’s clients and the quality of its work are no longer the sole determinant for prospective staff. It is now common for prospective employees and clients alike to enquire about a law firm’s ethics and values.
Disruption and opportunities
The way lawyers are being asked to operate is evolving. Some lawyers have commented that they are now inclined to be less confrontational in their dealings, as clients increasingly expect lawyers to be a facilitator of deals, not an impediment to them.
- TECHNOLOGY: Technology continues to affect the delivery of legal services. Staff working remotely continues to increase. Larger firms are investing in digital architecture that enable corporate clients and in-house counsel to more effectively collaborate in the drafting of documents.Disruption from artificial intelligence (AI) continues to grow with tools such as AI-driven legal assistants launching to provide basic legal advice. While this can make simple legal advice more accessible, firms are seeing that adding value in transaction-based law still comes from building strong relationships and being the ‘trusted adviser’ who will give clients deep and specialised advice with bespoke service.
- STRUCTURE: Law firms are acutely aware of their strategic positions and have become much more inclined to incorporate their businesses. The goal is not simply to limit their partners’ liability. Rather, they want more flexible capital structures and the ability to invest over the long term in capital intensive projects. Choice of remuneration options for increasingly diverse groups of practice leaders is essential. Increasing regulation, anti-money laundering (AML) requirements, in particular, are also having an impact on the profession, especially in smaller firms. Sole practitioners and small firms remain under pressure from this new regulation-heavy environment impacting their profitability.
This article was published in Pitcher Partners’ 2020 Legal Survey. For more information, access the full report here.
