RBS survey finds outsourcing and consolidation to rise as firms adapt to new legal market
More than 30% of law firms plan to increase their non-fee earner headcount over the next year , according to new research from the Royal Bank of Scotland.
March 27, 2014 at 05:00 AM
3 minute read
More than 30% of law firms plan to increase their non-fee earner headcount over the next year as pressure from clients on billing rates continues to drive down profitability and force firms to rethink their business models, according to new research from the Royal Bank of Scotland.
RBS' annual review of the legal market in 2012/13 and predictions for the first half of 2014 found that more than 60% of firms expect to increase fee levels over the coming 12 months, with 50% also predicting an increase in the number of chargeable hours.
Despite this, historic levels of profitability are still a long way off and will not return without firms making significant changes in the way they service clients.
Pressure from clients means firms need to continue rethinking how they best deliver service at prices corporates are willing to pay – driving more use of paralegals and legal process outsourcing as well as more analysis of work flows and disaggregation of work .
As a result, more than 30% of firms plan to grow non legal headcount in the coming year, with this growth coming as the survey found law firms are continuing to face overcapacity levels of at least 5%.
The survey, which focused on the UK's largest law firms and used Legal Week's Top 50 financial data, looked at a number of key issues for the legal market including lateral hiring, merger activity, international expansion, technology and alternative business structures.
Other key findings include 70% of respondents expecting to see the rate of merger activity increase over the next 12 months and only 6% of firms surveyed expecting lateral hiring to fall over the same period. This is despite the viability challenges of lateral hiring, given the difficulty of integration and cost of recruitment .
Commenting on the report James Tsolakis, head of legal services, corporate and institutional banking commented: "The legal sector is currently confronted by many challenges, from being 'over-lawyered' to stressed demand dynamics. I remain optimistic however about the future of the legal profession in the UK and market participants are clearly demonstrating a willingness to confront and respond to these challenges with initiatives which will permanently change the shape of the profession and the manner in which legal services are delivered."
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View All
Trending Stories
Who Got The Work
Dechert partners Andrew J. Levander, Angela M. Liu and Neil A. Steiner have stepped in to defend Arbor Realty Trust and certain executives in a pending securities class action. The complaint, filed July 31 in New York Eastern District Court by Levi & Korsinsky, contends that the defendants concealed a 'toxic' mobile home portfolio, vastly overstated collateral in regards to the company's loans and failed to disclose an investigation of the company by the FBI. The case, assigned to U.S. District Judge Pamela K. Chen, is 1:24-cv-05347, Martin v. Arbor Realty Trust, Inc. et al.
Who Got The Work
Arthur G. Jakoby, Ryan Feeney and Maxim M.L. Nowak from Herrick Feinstein have stepped in to defend Charles Dilluvio and Seacor Capital in a pending securities lawsuit. The complaint, filed Sept. 30 in New York Southern District Court by the Securities and Exchange Commission, accuses the defendants of using consulting agreements, attorney opinion letters and other mechanisms to skirt regulations limiting stock sales by affiliate companies and allowing the defendants to unlawfully profit from sales of Enzolytics stock. The case, assigned to U.S. District Judge Andrew L. Carter Jr., is 1:24-cv-07362, Securities and Exchange Commission v. Zhabilov et al.
Who Got The Work
Clark Hill members Vincent Roskovensky and Kevin B. Watson have entered appearances for Architectural Steel and Associated Products in a pending environmental lawsuit. The complaint, filed Aug. 27 in Pennsylvania Eastern District Court by Brodsky & Smith on behalf of Hung Trinh, accuses the defendant of discharging polluted stormwater from its steel facility without a permit in violation of the Clean Water Act. The case, assigned to U.S. District Judge Gerald J. Pappert, is 2:24-cv-04490, Trinh v. Architectural Steel And Associated Products, Inc.
Who Got The Work
Michael R. Yellin of Cole Schotz has entered an appearance for S2 d/b/a the Shoe Surgeon, Dominic Chambrone a/k/a Dominic Ciambrone and other defendants in a pending trademark infringement lawsuit. The case, filed July 15 in New York Southern District Court by DLA Piper on behalf of Nike, seeks to enjoin Ciambrone and the other defendants in their attempts to build an 'entire multifaceted' retail empire through their unauthorized use of Nike’s trademark rights. The case, assigned to U.S. District Judge Naomi Reice Buchwald, is 1:24-cv-05307, Nike Inc. v. S2, Inc. et al.
Who Got The Work
Sullivan & Cromwell partner Adam S. Paris has entered an appearance for Orthofix Medical in a pending securities class action arising from a proposed acquisition of SeaSpine by Orthofix. The suit, filed Sept. 6 in California Southern District Court, by Girard Sharp and the Hall Firm, contends that the offering materials and related oral communications contained untrue statements of material fact. According to the complaint, the defendants made a series of misrepresentations about Orthofix’s disclosure controls and internal controls over financial reporting and ethical compliance. The case, assigned to U.S. District Judge Linda Lopez, is 3:24-cv-01593, O'Hara v. Orthofix Medical Inc. et al.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250
