Seventy-six percent of lawyers want to work remotely at least one day a week – a staggering rise from the 37 percent that wanted to do so prior to the pandemic.
Not only that, but a whopping 84 percent of firms say they are investing more heavily in technology to make it possible for their lawyers to work remotely and adapt to the post-COVID landscape.
Those are two findings that leap from the pages of the 2021 Report on the State of the Legal Market. The big takeaway: the year 2020 was likely an inflection point for the redesign of legal services on a massive and unprecedented scale.
“There is considerable uncertainty and speculation as to what ‘normal’ operations will be, even in a post-pandemic world,” according to the report, which was produced by the Center on Ethics and the Legal Profession at the Georgetown University Law Center and Thomson Reuters Institute.
The major stumbling blocks to real change, the report says, are law firm partners themselves, “who have resisted trying new approaches for a variety of reasons.”
Read or download a pdf version of the 2021 Report on the State of the Legal Market.
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2021 Report on the State of the Legal Market
Here are some more key findings:
- “Most firms now acknowledge that remote working – though clearly different from in-person operations – can work. Indeed, the disruptions resulting from work-at-home arrangements were less serious than most firms expected.”
- Firms have a greater appreciation of how technology can facilitate the delivery of legal services than before the pandemic began. Indeed, 84 percent of partners … expected their firms to increase investments in technology. The experience of “adapting to the radically changed market conditions in 2020 may well create more openness to experimentation in other forms of service delivery,” the report says.
- Firms have reduced costs by: (a) making more efficient use of office and administrative space; (b) rethinking changes in staffing and work patterns; (c) altering levels of secretarial support; (d) reducing expectations for in-person meetings; (e) increasing the efficiency of digital connections; and (f) reducing business travel. Many of these changes are likely to remain even after the pandemic ends.
- Beginning in March 2020, there was a significant drop-off in consumer demand for legal services that affected virtually all law firms except bankruptcy and reorganization practices.
- Corporate legal departments, by contrast, saw their workloads increase. “Much of this work involved novel issues that had to be handled by in-house counsel themselves as it required an in-depth knowledge of their businesses and a very quick turnaround. As a result, some of the ‘business as usual’ legal work of their departments – including many transactions and litigation matters – had to be put on hold. This contributed to the drop in demand for law firms,” the report says.
- Despite the downturn in demand, most firms were able to increase their rates throughout 2020. This was partly because they “focused attention on billing and collection efforts, with the result that (at least in larger firms) there have been significant improvements in practices such as daily time recording, weekly time reviews, timely billings, follow-ups on client payment delays, and closer scrutiny of expected collections and potential problems.”
- As the pandemic progressed, firms proactively reduced the size of their legal staffs in all categories of lawyers. Firms also cut payroll and altered compensation structures. Forty-six (46) percent reduced partner draws; 40 percent reduced the salaries of fee earners; 34 percent furloughed support staff; 32 percent reduced the salaries of support staff; 36 percent discharged support staff; and 11 percent discharged fee earners.
- The report concludes: “It remains to be seen whether the cataclysmic events related to the COVID-19 pandemic will indeed prove to be a tipping point for the legal industry, the time when the redesign of the legal service delivery model (both for law firms and others) firmly takes hold. It seems fairly clear, however, that – whether it is a tipping point or not – the experiences of 2020 and 2021 will accelerate important changes in the way law firms operate and relate to their clients, lawyers, and staffs moving forward. Firms that take these changes seriously and respond to them proactively will undoubtedly emerge as the market leaders in the new post-pandemic normal.”
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