The Legal Industry’s Disruptor: Lawyers
For many years, both legal and business communities opined over the legal profession’s next ‘great disruptor’. Predictions included changes in billing models and technology, the rise of flexible/on demand legal services, the re-emergence of Big Four accounting firms in law, and equity, diversity, and inclusion initiatives.
All are true, and their impacts have been further fueled by the pandemic. While change has been unprecedented, its underlying factors are the same. In addition to changing generational expectations of what makes a ‘good’ job, many lawyers are fatigued from the nearly two-year pandemic and have re-evaluated their values and overall goals.
The past year has shown the biggest disruptors are in fact lawyers.
‘The Great Resignation’
Earlier this year, we predicted the war for talent would increase, which proved true. Throughout 2021, we saw unprecedented levels of work and demand at all levels of private practice and in-house. The rise in recruitment levels has been termed ‘The Great Resignation’.
The legal profession, built on precedents, has been generally resistant to change. The pandemic accelerated change, forcing lawyers to take a broader re-evaluation of work and employers to tighten their vision and strategy.
Lawyers leave their roles for many reasons (often a combination of): lack of advancement or engagement, high workloads, compensation, work-life balance, impact and strain of the pandemic, amongst others. Talent shortages have forced lawyers at all levels to take on more work.
Lawyers now seek more from their organization: more flexibility, more acknowledgement and advancement, and more diversity and equity. Such issues require thoughtful consideration and planning; however, due to increasing pressure and workload, legal employers find it difficult to focus on these matters. Instead, some law firms leaned into counteroffers, which included increased compensation, and in some cases, earlier admission into partnership to curb the Great Resignation.
Studies show that in more than 90% of cases where people accept counteroffers, they end up fired or leaving within six to twelve months of the counteroffer. For lawyers, there was a core cause that prompted them to explore other opportunities; eventually, the glow of the raise wears off and they are left grappling with the same issues that pushed them away in the first place. For law firms, counteroffers are often made in panic without consideration of the root cause driving the resignation.
The Great Resignation has created a candidate-driven market, leaving legal employers scrambling to offer raises and incentives to retain lawyers. According to HBR’s ‘Who Is Driving the Great Resignation’, employers must quantify and identify the root cause of higher resignation rates. Is the issue systemic? While resignations may have different reasons, can a root cause be identified?
Ian Cook said, “Exploring metrics such as compensation, time between promotions, size of pay increases, tenure, performance, and training opportunities can help to identify trends and blind spots within your organization.” Firms must consider if departing lawyers are seeking a larger platform, more work-life balance, flexible work options, etc.
Determining the root cause for the resignation can help the firm identify systemic issues affecting lawyer success and retention, as well as empower it to take appropriate corrective measures.
Reasons for lawyers resigning vary, and employers must develop a tailored approach for the root cause. Communication is key. In our experience as legal recruiters, poor communication is one of the most frequent issues cited by exiting associates. Over the years, associates have relayed their struggles about understanding work expectations, compensation structure, reward program, mentorship program, values, and goals of their former firm.
Communication is a two-way street, and the onus is on both the employee and employer. Lawyers must communicate their concerns to alleviate potential frustrations. Firms must ensure clear and consistent communication to understand its lawyers, provide targeted information and advice, and cultivate a working environment in which lawyers feel appreciated. Not all issues are systemic, and a solution may be easily found.
After the core cause(s) of turnover is identified, legal employers can develop tailored retention programs aimed at correcting the issues. If conversations are left to the time of resignation, firms have little choice but to turn to counteroffers. As mentioned, most employees that accept counteroffers ultimately leave their position within a year. Investing time for firms to speak to their lawyers, and vice versa, ensures potential problems are readily identified and dealt with.
In 2021, the Great Resignation challenged the legal profession, but difficult experiences can lead to positive change. As we continue to move forward in the pandemic, it is crucial for lawyers, law firms, and legal departments to identify and evaluate their needs to build more resilient careers and teams that will survive the years to come.
Cook, Ian. “Who Is Driving the Great Resignation”. Harvard Business Review, September 15, 2021, https://hbr.org/2021/09/who-is-driving-the-great-resignation