Articles Posted in Talent

That is the conclusion of a legal search firm’s President, published in “Things to Think About When Hiring Your General Counsel.” Methinks the Esquire Group doth overstate too much.

Possibly, if companies assume the candidates all possess the requisite level of legal judgment, the swing votes go to the one with more business shrewdness. Even so, a general counsel often hires, manages, and evaluates subordinate lawyers, and solid legal credentials count in those domains. Surely the key trait in a prospective top lawyer is mastery of the law.

Enough extra responsibilities have been lain at the door of general counsel (See my post of March 16, 2006) that to demote their lawyerly contribution smacks of either irony or ignorance.

In an article about the warm support among St. Louis law firms for the kickoff reception of a gay bar association (St. Louis Post Dispatch, March 9, 2006 by Gail Appleson), the journalist quoted the diversity manager at Sonnenschein Nath & Rosenthal as saying that hiring minorities is “a business decision, because clients were demanding it.” The director of professional resources at Bryan Cave extolled diversity and noted that “client attention to this issue makes our efforts all that more important.”

The article looked back at the 1999 “Diversity Statement of Principle” circulated by BellSouth’s general counsel. Some 500 in-house counsel signed the statement and agreed to consider a firm’s commitment toward diversity when they chose outside counsel.

The article continues.

A thoughtful article urges companies to define their strategically key positions – their A positions – and take pains to they staff them with A players (Harv. Bus. Rev., Dec. 2005 at 110). If that proposition holds true, does it mean that law departments have A positions, other than the positions defined by title and compensation. Law departments talk about core competencies (See my post of March 13, 2006 at Philip Morris and posts cited.), but should they be thinking about core positions?

According to the article, strategic positions are relatively rare – “less than 20% of the workforce.”

Strategic jobs do, however, display a great deal of variability in performance, which represents huge upside potential for improvement. If the authors’ example of salespeople’s’ productivity varying enormously applies equally to lawyers, then lawyers in the top decile may produce five to ten times the value of lawyers in the 50th percentile.

Some law departments are fortunate to have on their staff a support staff manager who is very good, perhaps at managing intellectual property, handling document discovery, or bringing together knowledge. These accomplished sorts become known in their industry, speak on panels, write articles and achieve recognition, yet the Human Resource policies of the company limit their pay, promotions and professional growth.

Eventually, vendors, consultants, other units in the company, or law firms snatch them away. Other than to do whatever you can to retain the expert, be sure you have your star try to develop successors or at least codify the practices and strategies of the group.

In 2005, “50 percent of the minority general counsel (current and recent) of Fortune 500 companies have public sector experience, particularly as federal prosecutors,” according to June Eichbaum, in Diversity & The Bar, Vol. 7, Sept./Oct. 2005. In contrast, the percentage with public sector experience for non-minority general counsel of Fortune 500 companies was much lower, at 14 percent. I assume that of the 466 majority GCs, other than the 65 with public sector stints on their resume, all made their way to the top through law firms or private sector law departments.

I noticed that 13 of the minority FF GCs – out of 34 — graduated an Ivy-league law school, and nine others graduated the law school of Boalt, Michigan, Chicago or Stanford. Did these minority lawyers, most of them possessed of stellar academic credentials, choose public service or did racial discrimination by firms and private sector law departments force them to the public sector?

To take the temperature every now and then of a law department’s employees, to find out what they like and dislike, to measure employee satisfaction are all worthwhile. The findings might lead to improvements.

Even so, “according to positive psychologists, the most important determinant of happiness is our ‘set point,’ a natural level of happiness that is … largely inherited.” From the Neuroethics & Law Blog posted on Feb. 24, 2006 I understand one’s set point is a baseline of personal happiness that stays pretty close to that setting most of the time and returns there even after glorious wins or crushing losses.

If a law department’s morale stems from the composite of its members’ individual set points, it may prove difficult to materially budge that point.

During a year-long initiative, senior lawyers in the John Deere Law Department, teaming with external consultants and human resources staff, comprehensively reviewed many aspects of its jobs.

“The process included evaluating positions within the legal department using position analysis questionnaires, and re-evaluating existing job descriptions for lawyers and amending the descriptions to reflect responsibilities and skills and competencies consistent with the overall company-wide efforts.” “Leading Practices in Job Titles for In-House Lawyers: What Companies are Doing” (Assoc. Corp. Counsel, Aug. 2005 at 13)

I don’t know what position analysis questionnaires do, but the general thrust of this initiation is commendable.

So that its counselors appreciate fully the total worth of their employment, the law department of John Deere explains what their salary and benefit potential could be over time with the company. This innovative practice is described only briefly in “Leading Practices in Job Titles for In-House Lawyers: What Companies are Doing” (Assoc. Corp. Counsel, Aug. 2005 at 14), but it makes sense.

Answer the questions everyone in the law department has about money, and do so before they muster up the courage to ask (See my post of July 24, 2005 about disclosure of compensation ranges, Nov. 24, 2005 on publishing bonus determinants, and Feb. 19, 2006 about some downsides of bonuses.). Spell out the situation regarding options, matching grants to 401Ks, tuition reimbursement, and all other aspects of compensation. Money may not buy happiness, but it certainly spawns rumors and speculation.

To be promoted to an officer, a lawyer in a corporation usually must be a direct report to the General Counsel, at a minimum.

The perquisites include participation in senior executive compensation plans, more indemnification rights, coverage under the D&O policies of the company, perhaps the right to accelerate options and grants in the case of change of control, and other benefits.

Whereas a promotion within the law department may not require anyone else’s approval (See my post of Nov. 8, 2005 on the role of HR representatives who serve law departments.), elevating someone to become an officer is a corporate decision. In most companies, the titles (and availability) of Senior Vice President or Vice President are determined by the company’s human resources department and its policies for such officer titles. Such slots are sparingly approved.

Deborah A. DeMott, “The Discrete Roles of General Counsel,” 74 Fordham Law Review 955-981 (2005) cites a slew of articles by or about general counsel and in-house counsel as a role. I have listed them in reverse chronological order.

Robert W. Gordon, A New Role for Lawyers?: The Corporate Counselor After Enron, in ENRON: CORPORATE FIASCOS AND THEIR IMPLICATIONS (Nancy B. Rapoport & Bala G. Dharan eds. 2004).

Michele M. Hedges, General Counsel and the Shifting Sea of Change, in ENRON: CORPORATE FIASCOS AND THEIR IMPLICATIONS 539 (Nancy B. Rapoport & Bala G. Dharan eds. 2004).