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Remote Lawyers at Risk of Falling Behind If Big Law Demand Drops

May 19, 2022, 9:00 AM

Welcome back to the Big Law Business column on the changing legal marketplace written by me, Roy Strom. Today, we look at how Big Law might handle its remote associates in a downturn. Sign up to receive this column in your inbox on Thursday mornings.

What goes up will inevitably come down.

We’re already seeing that truism play out in all kinds of markets as the economy makes a turn for the worse. Just ask any crypto traders or check your 401(k)—better yet, don’t.

Will it also apply to the ranks of lawyers Big Law firms hired in remote locations during the pandemic?

There are a couple of answers, depending on what you mean by “remote associates.”

One group of remote associates are the truly remote. These people were hired as a response to a surge in demand, particularly in transactional practices. Firms were forced to get creative during a tight labor market and they looked to new cities where they don’t have offices to fill their needs.

Those remote hires may have always been a short-term solution—even if firms didn’t market the jobs as such. One partner at a major firm told me he’d been upfront about this with associates hired in new cities. They came on board anyway, eager for a salary boost and experience at a top firm to add to their resumes.

These are the remote associates whose jobs are most at risk when the market contracts.

The probability of a recession is up to 30%, according to Bloomberg’s May survey of economists. That’s double the odds predicted just three months ago.

Goldman Sachs Senior Chairman Lloyd Blankfein said this week large companies should prepare for a recession. It’s a “very, very high risk,” he said.

Some recruiters are skeptical firms would jettison remote lawyers during a recession. Firms were more creative than that in the dire months leading up to the Covid recession. They cut pay across the board instead of slashing headcount, which was possible because the Covid recession didn’t lead to the prolonged downturn law firms experienced after the Great Financial Crisis roughly a decade earlier.

“They aren’t going to let people go that are essential to running their business and are essential to servicing their clients—whether they are in the office or not,” said Michelle Fivel, a partner at Major Lindsey & Africa. “The question becomes: Is it harder to be essential when you are remote?”

This is a trickier question! Especially for the other kind of remote associates: Those who have the choice to work remotely in today’s “hybrid” environment.

Firms have operated remotely out of necessity during the pandemic, and many have said they’ve built up training and mentoring programs that account for a less in-person touch.

But these situations are still relatively new for most firms. Many struggled even before some lawyers worked remotely with problems of favoritism and other biases when handing out work assignments.

Lack of opportunity is the same issue that has been blamed for women and diverse lawyers falling behind in law firms since long before the pandemic, said Lauren Rikleen, who has studied diversity in law firms. It’s incumbent on firms to develop procedures and policies that will ensure remote associates get important work assignments and training, she said.

One policy she singled out: The “free market” assignment system some firms use that gives partners the power to choose what associates handle their work.

“It’s a totally human characteristic, but we develop our favorite people and others don’t get a chance,” said Rikleen, who advises firms on developing diverse and multi-generational workforces through her Rikleen Institute for Strategic Leadership . “The system of assignments underlies a huge chunk of the ultimate success in a law firm environment. And fixing that is one of the major keys to a more diverse organization and having success onboarding and retaining remote employees.”

Summer Eberhard, a partner at Majory Lindsey & Africa, said she’s heard from several remote associates who feel they are “falling behind” compared to in-office peers. Even if they’re getting good work assignments, some feel they’re not receiving the right training and guidance .

“There’s going to be a lot of lateral movement from the firms that aren’t doing it well,” Eberhard said. “People are coming to me saying, ‘I’m not getting what I need. Is there a firm that will give me what I need?’”

Worth Your Time

On Lawyer Development: Vinson & Elkins is taking a new approach to lawyer development, borrowing from major banks’ playbook, Chris Opfer reports. The firm has hired lawyer development staff who will help junior lawyers, particularly women and racial minorities, get opportunities to move up the ranks.

On Crypto and Big Law: Crypto’s crashing and Big Law could cash in on the lawsuits, Sam Skolnik reports. Digital assets have generated more than 200 class action lawsuits and other private litigation as of this month, up more than 50% since the start of 2020, according to a law firm that tracks the activity.

On Big Law Moves: It was a busy week of hires for Big Law. Kirkland added six investment funds lawyers from Proskauer. Sidley added two sports industry dealmakers from O’Melveny & Myers, whileFreshfields hired a tech IPO lawyer in its Silicon Valley office.

That’s it for this week! Thanks for reading and please send me your thoughts, critiques, and tips.

To contact the reporter on this story: Roy Strom in Chicago at rstrom@bloomberglaw.com

To contact the editors responsible for this story: Chris Opfer at copfer@bloomberglaw.com; John Hughes at jhughes@bloombergindustry.com