| UK attorney and Director of Business Development at | | | | that their clients are beginning to demand. |
| LawScribe, Inc. | | | | Think about this: we’re not far from the day where |
| 1(818) 442-4615 | | | | the top firms will be paying their newly qualified |
| The Los Angeles Daily Journal announced in their | | | | associates salaries approaching $200,000 per annum. |
| March 19 issue that pay scales for first-year attorneys | | | | Do these firms and their clients really want these |
| rose yet again, with a number of firms hitting a | | | | associates’ time spent on document review and |
| staggering $160,000 starting salary. In the UK, the | | | | routine transaction based tasks if this work can be |
| situation is much the same. The reported that | | | | done elsewhere? If the US and UK talent pool is |
| Linklaters is expected to heat up the pay war with an | | | | shrinking, these associates will increasingly be spending |
| increase in its associate salaries of around 16 percent, | | | | their time on higher-end legal work both out of |
| to £69,000. The expected hike would push Linklaters | | | | necessity and because their clients will simply not |
| ahead of Clifford Chance in the battle to win over | | | | accept anything else. India’s vast pool of highly |
| top-flight graduates with lucrative starting salaries. | | | | qualified legal talent is the obvious choice to provide the |
| Unsurprisingly, the remaining “magic circle” firms | | | | outsourced legal support the US and UK firms will |
| are currently “reviewing their salaries”. | | | | require. It is this thirst for talent that has led to the |
| Is it just me or does anyone else have a sense of | | | | development of the Offshore Legal Process |
| “keeping up with the Joneses” going on here? | | | | Outsourcing industry. US and UK Law firms have been |
| Why do firms feel such enormous pressure to match | | | | exploring and developing relationships with offshore |
| each other in junior associate pay? The reason is | | | | legal service providers now for the last 12-24 months |
| because they are all trying to compete for the same | | | | and this trend shows no signs of slowing down. |
| pool of top talent. The competition for available talent is | | | | Offshore legal process companies such as LawScribe |
| only going to become even more intense as 75 million | | | | have moved beyond traditional back office legal |
| baby boomers will soon give way to around 30 million | | | | support services to increasingly more complex core |
| generation X-ers. Although its seems incredulous right | | | | legal work including legal research, patent and |
| now given the preponderance of law school | | | | trademark searching and drafting, document drafting |
| graduates, various studies indicate that there will be a | | | | and due diligence. |
| shortage of around 14 million skilled workers in the US | | | | It’s also no secret that over the last 12 months a |
| by 2020. | | | | number of the top 100 firms have sent high power |
| How high can the salaries rise and how long can this | | | | delegations to India. In turn the UK Law Society |
| go on for before the tide turns? The answers lie with | | | | recently invited a 20-strong delegation from the All |
| the leading firms’ corporate clients. Although there | | | | India Bar Association (AIBA) to the UK in the hope that |
| is no present indication that these clients aren’t | | | | this may help speed up the process of liberalizing entry |
| willing to pay premium bills for multi-million dollar litigation | | | | into the Indian legal market. Some UK Government |
| matters, eyebrows are starting to be raised at first | | | | sources predict a partial opening of the Indian legal |
| year associates’ over inflated hourly rates for | | | | services market within a couple of years. As Indian |
| routine, transaction based legal work. | | | | domestic regulations currently stand, Indian firms are |
| The top law firms are perfectly aware of this and | | | | prohibited from advertising or from having more than |
| realize that while they will continue on the one hand to | | | | 20 partners. The 1961 Advocates Act, which forbids |
| pay the ever decreasing pool of US and UK skilled | | | | foreigners from practicing in India, will also have to be |
| talent ever increasing wages, they are also on the look | | | | amended. |
| out for cheaper labor elsewhere. This labor has | | | | Until these changes are implemented even the largest |
| become available through the opening up of the global | | | | firms will continue to explore relationships within the |
| legal marketplace and the increasing proliferation of | | | | growing legal process outsourcing market. So long as |
| offshore and outsourced legal process support | | | | associates’ salaries continue to rise and clients |
| companies. The major law firms on both sides of the | | | | increasingly become more demanding and price |
| Atlantic are now looking towards Asia, and in particular | | | | sensitive, the offshore legal process outsourcing |
| India, to provide them with the extra string to their bow | | | | industry will continue to flourish. |