Articles Posted in Talent

Professionalism runs rampant in legal departments – not just lawyers. More and more members of legal departments at least have the opportunity for additional education and recognition as a trained person in their area, a hallmark of professionalism. This idea came to me from an article on the rising level of professionalism in nonprofits and its rationalizing effect on how they are run, all in Admin. Sciences Quarterly, Vol. 54, June 2009 at 268. Somewhat similarly,

E-discovery experts can take courses and be recognized;

Paralegals can earn certifications (See my post of March 23, 2006: certificates of paralegals; and March 19, 2006: certified legal assistants are as common as non-certified.);

This blog has put its boots on and waded into the ugly stream of bad interactions among co-workers. After all, in legal teams as elsewhere frustrations and grievances lurk and often spread (See my post of Oct. 24, 2006: rumors and back-biting.). Several came to mind.

Bias regarding physical appearances (See my post of March 26, 2008: physical appearance with 11 references.);

Competitiveness (See my post of Oct. 2, 2008: competitiveness with 29 references.);

Gina Passarella, writing in the Legal Intelligencer, Oct. 14, 2009 on the Thomson Hildebrandt 2008 Law Department Survey (ed. Jon Bellis), extracts some findings that suggest internal budgets were kept mostly flat other than modest increases in compensation.

The survey shows median total spending increased by five percent in the United States and by four percent worldwide between 2007 and 2008. When looking at outside counsel spending, which makes up about 60 percent of the average legal budget, that spending increased four percent in the United States and six percent worldwide. Hence, in the U.S., inside spending, which accounts for about 40 percent of all legal spend, must have increased perhaps six percent so that the inside six percent and the outside four percent comes to the overall five percent.

It is widely known that compensation accounts for approximately three-quarters of a law department’s inside spending. According to the survey, the average increase in base salary for in-house attorneys was three percent and there are usually some bonus and incentive amounts on top of that along with benefits. So compensation increases must have taken up nearly all of the increase in inside budgets. Otherwise, general counsel held the budget line tight.

A report from the Corporate Executive Board identifies 38 attributes in what it calls the Employment Value Proposition (EVP). Out of 38 EVP attributes of an organization, they found two to be the top drivers of commitment: “Manager Quality” and “Collegial Work Environment.” Manager Quality is a vast topic, barely plumbed on this blog. Collegiality I have addressed (See my post of Oct. 19, 2009: a collegiality index and benchmark for legal departments.).

Three other drivers are critical to improve both the quantity of employees attracted and the quality of their commitment: “Development Opportunities,” “Future Career Opportunities,” and “Respect.”

Since few in-house lawyers can be promoted more than once or twice in a department, “Development Opportunities” turns on giving people interesting assignments that let them grow and investing in CLE for additional training. “Future Career Opportunities” within a law department (aka career path) is an intractable problem; no general counsel wants to consciously groom lawyers to leave the department (See my post of May 4, 2009: in-house counsel career paths with 15 references.).

Don Liu, general counsel of Xerox, mentions an unusual restriction on legal departments. “I’m aware of at least two U.S. public companies that had a non-U.S. lawyer who ran their legal department, although they couldn’t call themselves the general counsel because of licensing requirements.” The quote comes from David Galbenski, Unbound: How Entrepreneurship is Dramatically Transforming Legal Services Today (2009) at 34 (See my post of March 22, 2006 that differentiates “general counsel” and “chief legal officer.”).

If “General Counsel” has professional ethics or licensing restrictions, does “Chief Legal Officer”? Do state laws prohibit people other than U.S.-admitted lawyers to carry the title “General Counsel”? By the way, I think in decades past, law firms were sometimes referred to as a company’s “general counsel.”

This post gathers my metaposts on various categories of employees in legal departments, other than the general counsel. There are too many posts about general counsel for me to make sense of them in this way. So I focused on six other levels.

Administrators (See my post of Feb.13, 2008 administrators, office managers with 21 references.).

Deputy General Counsel (See my post of Jan. 30, 2009: deputy general counsel with 11 references.).

The ties between some law departments and their primary firms can be very close, but a suffocatingly close one was referred to in Corp. Counsel, Vol. 16, Oct. 2009 at 20. Chevron chose Charles James to become general counsel in 2001; James had been a partner at Jones Day. James’ successor, taking over in August, is R. Hewitt Pate, a former partner at Hunton & Williams. Note the two most recent general counsel of the $263 billion Chevron were law firm partners. But those two selections are not the bearhug.

“Until James became GC, Pillsbury [Winthrop Shaw Pittman] partners headed Chevron’s law department for decades.” Decades! That is a law firm with a hammerlock on its client.

Dominance by a firm creates problems, one of which in Chevron’s situation is that the hard-working, good lawyers in Chevron’s in-house group were never promoted to the top spot. Indeed, they might have known that the ceiling was at the highest to be a direct report to an imported partner, never the top spot. How demoralizing that must have been! How much attrition it might have caused! How hard it might have been to recruit crackerjack, ambitious lawyers if they realized the brass ring was unattainable!

In a profile of the chief responsibility and ethics officer for MillerCoors,Diversity & The Bar, Sept.-Oct. 2009 at 35, describes a practice followed by Richard Deusenberg, the now-retired general counsel of Monsanto. “For one week every year, he ran his company’s legal department on our [Valparaiso University, Indiana] campus. During the course of the day, he maintained an open-door policy for curious students…”

Those campus campouts encouraged law students to consider in-house practice. Instead of the lockstep tramp to law firms, some law school graduates might step into a legal department. Many general counsel could look for ways to raise such consciousness.

“For a company with $10 billion in revenue, each year of additional average lawyer tenure in a legal department reduces damages, settlements, and fines by approximately $1.7 million.” That finding comes from research the General Counsel Roundtable published in 2001 (based on 1999 data). The longer its attorneys have practiced in the legal department, the lower those particular legal expenses.

By contrast, total outside and inside expenses, which exclude damages, settlements and fines, drop until the average attorney tenure reached 5.3 years, and then began to rise, “suggesting that departments are not fully capturing the value of more tenured lawyers.” I think that last phrase means that you pay more each year but the productivity or judgment delivered of the lawyers does not keep pace (See my post of Nov. 28, 2007: a proposed years-of-experience benchmark; and Nov. 28, 2005: average age of lawyers in one set of departments.).

The findings conclude that the value of veterans in a department is so strong that “increasing lawyer tenure lowers total legal costs.”

Not much appears in the press about secretaries in legal departments. I do not mean Corporate Secretaries, I mean admins, executive assistants, traditional file-copy-type-answer phones-and-schedule secretaries (See my post of May 17, 2006: whither the term “secretary”; and Nov. 22, 2006: the new title, “Legal Administrative Assistant”.). Everyone knows that secretaries can contribute hugely to the success of lawyers and departments (See my post of Jan. 15, 2009: isolated lawyers often rely on local secretaries; and Sept. 5, 2007: with every successful lawyer, a secretary.). Some secretaries rise a long way (See my post of May 26, 2007: Mellon GC hired as attorneys three former secretaries.).

A few posts address secretarial metrics (See my post of June 28, 2005: ratios of paralegals and secretaries; April 23, 2006: four lawyers per secretary; Dec. 17, 2007: less support staff inside than at law firm; July 31, 2006: secretaries counted in terms of lawyer-equivalents; and May 11, 2008: secretarial numbers declining as lawyers type more.). Other posts on this blog consider their reporting structures (See my post of June 28, 2005: reporting lines of secretaries; Sept. 10, 2005: administrators supervise secretaries; and Aug. 3, 2005: secretarial pools have dried up.).

Competent legal secretaries are expensive (See my post of Dec. 22, 2006: high cost of experienced legal secretaries; March 17, 2006: higher pay for secretaries who use shorthand; Nov. 30, 2007: secretaries are typically non-exempt; and June 24, 2009: a proposal for an internal market for secretarial services.).