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In-house legal departments have been continuously asked to find ways to save money and to do more with less. With a recession looming, legal departments are finding new ways to utilize contract attorneys to do somewhat complicated work for less money.

Matthew Weaver, director of interim legal services at Major, Lindsey & Africa, said there has not been a significant increase in legal departments requesting contract attorneys. However, those who are asking for contract attorneys are asking for different projects than just basic contract review.

"We have seen requests from preexisting clients," Weaver explained. "We haven't seen a boom, because it's been a trend that has been slowly gaining steam over the last decade."

Weaver said he has been asked to find contract attorneys who can perform transactional work, those who can work out contracts for procurement and health care work pertaining to the Health Insurance Portability and Accountability Act.

Lea Ann King, general counsel, compliance officer and corporate secretary at Toyota Material Handling in Cincinnati, said she has been using contract attorneys throughout her 11-year in-house career. Traditionally, King said she would bring in a contract attorney when someone in the legal department was out on medical leave to fill a temporary position.

"It was truly plugging in a temporary resource," King explained.

However, more recently, the talent pool of contracted attorneys has expanded, and she said she can bring them on for more complicated tasks or for special projects.

"Recently we brought some in for document review in large litigation. We had outside counsel review the work but for the quality and cost of that work, it was a win to have contract attorneys doing that review," King explained.

She said she has not had any conflict between her law firms and independent contractors. Early on in the process, she set the expectation that a partner in the firm handling litigation would be overseeing the work of the contract attorneys.

Even more recently, when the pandemic from the new coronavirus shut down large gatherings, King said she brought in contract attorneys to review the contracts the company had with different venues and had them draft cancellation agreements for those events.

"The nice thing about being in-house counsel is that we have a budget to live by. Bringing in contract attorneys was a way for us to increase head count but not have to go through all of the things required when hiring a full-time attorney," said Jeff Wigfield, former deputy general counsel of Hub Group in Chicago.

He explained that there are great attorneys who work on a contract basis for $120 to $130 an hour. An associate at a major law firm doing the same work could be charging anywhere from $500 to $700 an hour.

At Hub Group, contract attorneys are largely used to draft and review contracts. Wigfield said in 2019 the legal department executed approximately 2,000 contracts and needed help going through those agreements.

"We also brought in a transactional attorney on a contractual basis," Wigfield explained. "When we have an M&A deal, we would use him to do the due diligence and bring in-house some of the work that would go to a firm."

Because of the increased talent level, contract attorneys are being utilized for every area of work. Amy Lerner Hill, deputy general counsel at City National Bank in Los Angeles, told Corporate Counsel that contract attorneys are largely used for overflow work or for when someone is out on leave. However, subject-matter expertise is important.

Her team in the bank's legal department does everything from litigation to privacy and operations, so she utilizes contract attorneys that can cover those specific areas.

The Future of Contract Attorneys      

Despite the increased uses for contract attorneys, Weaver said in-house counsel will not be getting rid of their firms anytime soon.

"There is no replacing a senior partner at an Am Law firm that runs a large acquisition or a senior cybersecurity attorney," Weaver said.

"However there is an amount of work, which can be project-driven, that doesn't require a senior partner but does require a specialized attorney," he continued.

Wigfield said he would expect to see more attorneys shift from working full-time in-house or at a law firm to working on a contract basis.

"These attorneys are making decent money and working their own hours," Wigfield explained. "In-house counsel are going to keep using them to keep costs down, and the work-from-home environment has taught a lot of people they can be effective outside of the office."

Weaver said becoming a contract attorney is an attractive opportunity for those who are not climbing the corporate ladder to become a partner or general counsel.

"These are people who want to be an attorney and they want to have a career. However, they don't want to play political games," Weaver said.

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In-House Departments Aren't Necessarily Fishing in Post-COVID-19 Legal Talent Pool

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