Will Recession Force Restructuring of Legal Profession?

An interesting column is in today's New York Times that looks at the legal profession as it is buffeted by the recession and corporate clients seeking to drastically control their legal expenses. The current set up of large law firms is like a plantation system where the partners oversee the laborers made up of the associates. In some cases the partners do little - the real work is done by associates - yet bill crazy amounts for their inflated time. Meanwhile, associates are pressured to bill literally every minute of their time to generate required billable hours and collect fees. Associates often feel themselves to be like rats on a wheel with no way of exiting. Meanwhile life among the partners is no cake walk either and in many firms life among the partner ranks is like being in a piranha tank. Ethics and competence frequently means little and an amoral "rainmaker" may be highly successful while good, ethical attorneys fall by the way side. Of course in conservative areas of the country, being gay is a career killer (no large law firm in this area of 1.6 million people has an openly gay attorney to my knowledge despite the fact that all of the top law schools in the state require firms interviewing on campus to have a non-discrimination policy that includes sexual orientation). Despite the public perception, law is not a career I would recommend to anyone - at least not private practice as it currently exists. Here are some column highlights:

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The economic downturn is hitting the legal world hard. American Lawyer is calling it “the fire this time” and warning that big firms may be hurtling toward “a paradigm-shifting, blood-in-the-suites” future. The Law Shucks blog has a “layoff tracker,” and it is grim reading. Top firms are rapidly thinning their ranks, and several — including Heller Ehrman, a venerable 500-plus-lawyer firm founded in 1890 — have closed.

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The employment pains of the legal elite may not elicit a lot of sympathy in the broader context of the recession, but a lot of hard-working lawyers have been blindsided, including young associates who are suddenly finding themselves with six-figure student-loan debts and no source of income.

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The silver lining, if there is one, is that the legal world may be inspired to draw blueprints for the 21st century. The changes are likely to begin with compensation. . . . Lower pay should mean that associates will not need to work the grueling hours many have been forced to. And it will mean less pressure to go into private practice for law graduates who would rather do something else.

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Clients are also likely to benefit — and consumers, since legal fees are built into the cost of almost everything. Even before the downturn, big-firm clients, led by the Association of Corporate Counsel, were pushing to phase out the billable hour — which can go as high as $1,000. Tight corporate budgets will give clients more leverage to push to pay by the project or for successful outcomes.

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Law schools may also become more serious about curriculum reform. The Carnegie Foundation for the Advancement of Teaching released an influential report that, among other things, urged law schools to make better use of the sometimes-aimless second and third years. If law jobs are scarce, there will be more pressure on schools to make the changes Carnegie suggested, including more focus on practical skills.