For CdM: Bullshit jobs

[CountDeMoney]

All regulatory stuff stays here, though, from HIPAA to SOX.

Ah, that's of course nice when the government protects your bullshit business.

My point is, all this bullshit about legal outsourcing is exactly that: bullshit.  Boilerplate contract language?   Big fucking deal.  It's about as important and productive as outsourcing HR verifications to India for $50 a pop.  The important shit worth countless billions is still being generated here.

[ulmont]

Only using American lawyers to review the work of five to ten Indians could still make sense. Confidentiality is something that can be enforced via civil law and it's not like companies shy from outsourcing their entire data processing to third parties.

1) Again, who's motivated to do this?  It's not the American lawyers; it would be the American clients that would have to push this.  Since the only reason to push this would be for price, it would be easier for the American clients to find a cheaper law firm (or solo practitioner).
2) Quite a few companies do shy from "outsourcing their entire data processing to third parties" for similar reasons.

[Ideologue]

There are some larger regulatory issues in play, like not being able to practice law in the United States (i.e., write the contracts for the bank) unless you are a member of the appropriate jurisdiction.  So the bank almost has to hire legal services from a local firm, which then has little motivation to outsource its work (among other factors, someone licensed in the jurisdiction would have to review all the work, etc. etc.).  Some document review (i.e., Ide's job) has gone to India, but not a lot in light of concerns over confidentiality and a preference to have licensed attorneys doing the review work.

Only using American lawyers to review the work of five to ten Indians could still make sense. Confidentiality is something that can be enforced via civil law and it's not like companies shy from outsourcing their entire data processing to third parties.

Thing is, we're actually competitive on price.  And since we speak real English, rather than pidgin Indian English, we tend to turn out a superior work product.

[Berkut]

Only using American lawyers to review the work of five to ten Indians could still make sense. Confidentiality is something that can be enforced via civil law and it's not like companies shy from outsourcing their entire data processing to third parties.

1) Again, who's motivated to do this?  It's not the American lawyers; it would be the American clients that would have to push this.  Since the only reason to push this would be for price, it would be easier for the American clients to find a cheaper law firm (or solo practitioner).

The people motivated to do this are those who wish to bid for a client and can offer a lower bill rate. The "American lawyers" who would want this are those who want the business that is currently going to someone who does not outsource - they can offer their services for a fraction of the cost.

If traditional firm charges $200/hour average, and offshoring firm can offer 25% of their work at $200/hour, and 75% at $80/hour (while offshoring that 75% out at $40/hour) they have a pretty large competitive advantage....if they can keep the quality, of course.

[Ideologue]

All regulatory stuff stays here, though, from HIPAA to SOX.

Ah, that's of course nice when the government protects your bullshit business.

My point is, all this bullshit about legal outsourcing is exactly that: bullshit.  Boilerplate contract language?   Big fucking deal.  It's about as important and productive as outsourcing HR verifications to India for $50 a pop.  The important shit worth countless billions is still being generated here.

Actually, the thing worth "countless billions" is the most susceptible to outsourcing (although really it's automation that frightens me, for reasons outlined in my previous post).

You think BigLaw makes its money by drafting a few novel contracts?  Some, yes.  But the big business is in corporate litigation.  Litigation means discovery, which means document review, which means an army of temps or foreigners going through millions of emails and spreadsheets, and being billed out at three to ten times their labor cost.  That's the countless (highly countable) billions, and the work will die as soon as 1)jurisdictions begin to permit unfettered automation and 2)general counsels decide to stop wasting their companies' monies.

The first wave, offshoring then inshoring (which I benefited from) is already past.  But in a few years, it will be computers.

Hell, I'm sort of surprised and impressed by how BigLaw has managed to protect their money machines so successfully over the past twenty years.  Assuming the work is necessary in the first place--which I can get behind, in the absence of automation, someone does have to actually do the work of production and redaction--there is nothing about a JD that prepares one to do the work, other than to endure boredom; if I were king, and if I were thinking about the common welfare, I'd permit non-lawyers to do it.

I wouldn't permit foreigners to do it, because if I were king we'd be an autarkic economy, but that's a different issue.

I dunno.  Perhaps it's just [firm name] that makes its money off such business, and not all BigLaw firms.

[CountDeMoney]

My point is, all this bullshit about legal outsourcing is exactly that: bullshit.  Boilerplate contract language?   Big fucking deal.  It's about as important and productive as outsourcing HR verifications to India for $50 a pop.  The important shit worth countless billions is still being generated here.

Actually, the thing worth "countless billions" is the most susceptible to outsourcing (although really it's automation that frightens me, for reasons outlined in my previous post).

You think BigLaw makes its money by drafting a few novel contracts?  Some, yes.  But the big business is in corporate litigation.  Litigation means discovery, which means document review, which means an army of temps or foreigners going through millions of emails and spreadsheets, and being billed out at three to ten times their labor cost.  That's the countless (highly countable) billions, and the work will die as soon as 1)jurisdictions begin to permit unfettered automation and 2)general counsels decide to stop wasting their companies' monies.

The first wave, offshoring then inshoring (which I benefited from) is already past.  But in a few years, it will be computers.

Hell, I'm sort of surprised and impressed by how BigLaw has managed to protect their money machines so successfully over the past twenty years.  Assuming the work is necessary in the first place--which I can get behind, in the absence of automation, someone does have to actually do the work of production and redaction--there is nothing about a JD that prepares one to do the work, other than to endure boredom; if I were king, and if I were thinking about the common welfare, I'd permit non-lawyers to do it.

I wouldn't permit foreigners to do it, because if I were king we'd be an autarkic economy, but that's a different issue.

I dunno.  Perhaps it's just [firm name] that makes its money off such business, and not all BigLaw firms.

I'm not referencing BigLaw, I'm talking about internal Legal Departments and in-house counsel embedded within organizations.  Not everything in the Fortune 500 is outsourced to legal mercenaries.

[Ideologue]

That's like one of GC's biggest jobs, to outsource discovery work during litigation to a firm.

Contracts and such are not worth billions to the in-house people, it's worth billions to the companies they work for; I thought you meant the actual billions in revenue "generated" by lawyers.

[crazy canuck]

You think BigLaw makes its money by drafting a few novel contracts?  Some, yes.  But the big business is in corporate litigation.  Litigation means discovery, which means document review, which means an army of temps or foreigners going through millions of emails and spreadsheets, and being billed out at three to ten times their labor cost. 

Ide, you have a really distorted view of economics within legal firms.  I can only think that it because you have limited exposure to how firms work and you are employed in a company that services outsourcing of litigation support and so your view is necessarily limited.  Most large firms are run by the commericial solicitors.  That is where the money is percieved to be.  Simple things like being the official records and filing office for a corporations can generate millions in routine corporate filing requirements that can be done for next to no effort.   Add to that all corp reorg and the big money makers of mergers and acquisitions and the revenue stream really starts ramping up.  Litigation discovery work pales in comparison to the type of due diligence work done in any reasonably sized merger or acquisition.

Litigation also does not provide as steady a stream of income.  It is generally one off type stuff - although some rare clients do tend to generate a reliable number of pieces litigation (slip and fall cases in department stores for example).  But by and large large pieces of litigation come and go and are a lot more unpredictable in terms of revenue streams to the firm.

As a result corporate lawyers tend to be over renumerated and litation partners tend to be under renumerated within firms relative to eachother.  That is one of the reason, over the last 20-25 years, more and more boutique litigation practices have developed.   Litigators have realized they can make more money on their own.

There is still a large attraction to being part of a large firm for some litigators but generally those will be people who are able to specialize in a paricular area because they have developed a relationships with a solitor group within the firm that feed the litigator his work. 

[ulmont]

If traditional firm charges $200/hour average, and offshoring firm can offer 25% of their work at $200/hour, and 75% at $80/hour (while offshoring that 75% out at $40/hour) they have a pretty large competitive advantage....if they can keep the quality, of course.

While not disagreeing with your math, I think there are some items you're not considering (such as the larger firms not competing on price, the smaller firms not being able to get the volume of work necessary to have this happen, and ignoring the existence of cheap solos).  But I think that any useful further discussion would need to be done in person, over beer.

[Zanza]

I'm not referencing BigLaw, I'm talking about internal Legal Departments and in-house counsel embedded within organizations.  Not everything in the Fortune 500 is outsourced to legal mercenaries.

I am working for a Fortune 500 company and our legal department seems to be fairly small and the lawyers all seem to be in the rank of a senior manager or higher, so rather expensive employees. I don't know, but I would be surprised if they didn't give most of their issues to law firms and mainly review what their suppliers gave them. 

[crazy canuck]

I'm not referencing BigLaw, I'm talking about internal Legal Departments and in-house counsel embedded within organizations.  Not everything in the Fortune 500 is outsourced to legal mercenaries.

I am working for a Fortune 500 company and our legal department seems to be fairly small and the lawyers all seem to be in the rank of a senior manager or higher, so rather expensive employees. I don't know, but I would be surprised if they didn't give most of their issues to law firms and mainly review what their suppliers gave them.

It really depends on how things are set up.  In my practice it is often the other way around where the inhouse folks do most of the mundane day to day stuff and it is only when something unusual comes around that they ask for outside help to review and advise as to what they have already done and perhaps to take over the file to some extent.  Most inhouse lawyers will not do any of litigation of course and so all of that would come to me.  But by definition litigation would be unusual so that fits with the basic model.

[Ideologue]

You think BigLaw makes its money by drafting a few novel contracts?  Some, yes.  But the big business is in corporate litigation.  Litigation means discovery, which means document review, which means an army of temps or foreigners going through millions of emails and spreadsheets, and being billed out at three to ten times their labor cost. 

Ide, you have a really distorted view of economics within legal firms.  I can only think that it because you have limited exposure to how firms work and you are employed in a company that services outsourcing of litigation support and so your view is necessarily limited.  Most large firms are run by the commericial solicitors.  That is where the money is percieved to be.  Simple things like being the official records and filing office for a corporations can generate millions in routine corporate filing requirements that can be done for next to no effort.   Add to that all corp reorg and the big money makers of mergers and acquisitions and the revenue stream really starts ramping up.  Litigation discovery work pales in comparison to the type of due diligence work done in any reasonably sized merger or acquisition.

Litigation also does not provide as steady a stream of income.  It is generally one off type stuff - although some rare clients do tend to generate a reliable number of pieces litigation (slip and fall cases in department stores for example).  But by and large large pieces of litigation come and go and are a lot more unpredictable in terms of revenue streams to the firm.

As a result corporate lawyers tend to be over renumerated and litation partners tend to be under renumerated within firms relative to eachother.  That is one of the reason, over the last 20-25 years, more and more boutique litigation practices have developed.   Litigators have realized they can make more money on their own.

There is still a large attraction to being part of a large firm for some litigators but generally those will be people who are able to specialize in a paricular area because they have developed a relationships with a solitor group within the firm that feed the litigator his work.

Hmm.  That's fair enough.

[CountDeMoney]

5 Trends in In-House Counsel Compensation
By Marlisse Silver Sweeney
Corporate Counsel
June 26, 2013

Are the pay packages in your legal department keeping up with the Joneses? The new "In-House Counsel Compensation Report" from General Counsel Metrics LLC and Major, Lindsey & Africa, a legal search firm, deciphers the trends in compensation by compiling data from over 1,700 in-house lawyers at approximately 480 U.S. and Canadian companies. The information used for the report includes: base salaries, cash bonuses, law school graduation years, primary practice areas, company revenues, and company industries.

"It's data that we all deal with a lot, but we never collected it all at once and analyzed it," Rees Morrison, president of GC Metrics told CorpCounsel.com. He says the report provides a "roadmap for roughly figuring out where [counsel] sit on [the compensation] spectrum."

"There's so much hype around lawyer compensation in general, and I think the expectation is that it's very high," Bob Graff, vice president of global business development at ML&A told CorpCounsel.com. In reality, he noted that in-house lawyers and GCs probably work more predictable, shorter hours than their Big Law counterparts, and thus salaries are "in a much tighter, realistic range," says Graff. "They're not as high as people may think."

Just how high are they? From company revenue to practice experience, the report found five major trends:

1. Experience matters in-house

"Median base salaries for in-house lawyers cross the $180,000 mark at about 20 years experience, and peak at about 30 years out of law school," the report says. The median salary for a lawyer who graduated law school in 1975 is $195,000, whereas the median salary for a lawyer who graduated in 2010 is $75,000. Not surprisingly, bonus levels for all in-house lawyers peak at 25-30 years of experience.

2. The size of the company and industry correlate to the size of a GC's bonus

The report found that general counsel's bonuses, "do not appear to be highly correlated with years of experience." For GCs, the size of the company and the industry were more relevant to their bonuses. For GC base salaries, the years of practice experience were pertinent, but the report found that regardless of experience, "the bulk of GCs . . . make a base salary of approximately $250,000."

3. Extractive/mining/chemicals is the most lucrative industry for in-house counsel

The extractive/mining/chemicals category is the highest-paid sector for general counsel, followed by the food and beverage industry.

For in-house counsel at all levels, the medical device and pharmaceutical sectors join the extractive industry to round out the highest-paid industries. For both GCs and in-house lawyers, not-for-profit is, not shockingly, the lowest-paid sector.

4. Salaries are comparable for in-house lawyers across company sizes

The report found that "across all company sizes, median total cash compensation for all in-house lawyers is in a remarkably tight range." The median total compensation, which includes base salary and cash bonuses, for in-house lawyers working for companies with revenues of less than $1 billion is $170,000. The median salary for lawyers working at companies with revenues of more than $5 billion is $205,405.

"It's as if Corporate America has hit upon roughly . . . the value in-house lawyers bring and then tend to coalesce around that value for the total cash compensation," says Morrison. There is a similarly tight range with respect to in-house bonuses—with the exception of lawyers practicing in the securities industry, whose median bonuses were $48,000, compared to $28,000 bonuses in the second-highest industry, mergers and acquisitions.

5. Past $1 billion in revenue, GC salaries stay in a tight range

For general counsel, once the company's revenue passes the $1 billion dollar range, base salaries stay in a comparable range. GCs who work for companies with less than a billion in revenue can expect a median salary of $245,000. At the $1 billion revenue mark, salaries start at a $320,000 median, and then bump up to $350,000 for those working at a company with over $5 billion dollars in revenue.

[Malthus]

I think there is a perception out there that lawyering is a matter of mastering the right arcane mumbo-jumbo, which can (and maybe should) be either simplified, handed over to a computer to do, or outsourced to India. 

Fact is, there is a certain amount of jargon and mumbo-jumbo in the lawyering world as there is in any profession - but at base, good lawyering requires a deep knowledge of the client's affairs, a deep knowledge of the local circumstances (both regulatory and practical), and the ability, through experience, to foresee the types of problems that can arise - and prevent them. I'm talking about corporate and regulatory lawyering, not litigation, of course - litigation is all about solving problems that haven't been prevented.

To counter Berkut, a lawyer isn't really like a security guard at Wal-mart - a lawyer is more like the architect one hires to build the Wal-mart. Does an architect "make anything"? S/he plans out what others will make, taking into account the local building codes, the physical layout of the mall, and the customer's needs. Similarly, a corporate lawyer plans out how a buisness is to operate, down to such minor details as whether the baby sleepware sold in the store mas to be seperately tested in that specific jurisdiction or whether the testing in (say) California would suffice. Plan badly, and very bad things happen. This is not something you want to farm out to some dude in India ...

[Ed Anger]

I would flay a thousand lawyers and use their skulls for my throne.