Simmons set to vote on moving legal jobs offshore
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Firm lines up qualified agency staff in India, South Africa or Australia
SIMMONS & Simmons is preparing a plan to outsource work to agency lawyers in low-cost jurisdictions, paving the way for a fresh wave of outsourcing in the legal sector.
Partners will vote this week on a proposal to use external lawyers in India, South Africa or Australia for large pieces of litigation or corporate due diligence.
Other firms, including Clifford Chance and Lovells, have outsourced paralegal and support staff functions, but Simmons is the first major firm to consider using qualified agency lawyers abroad.
The move would put paralegal, trainee and associate jobs at risk in the firm’s English-speaking offices.
It is understood that Simmons could achieve a 50 per cent cost-saving on each role that is moved offshore.
Managing partner Mark Dawkins has pinned the firm’s new three-year strategy on maximising efficiency.
“We want to be at the forefront of delivering value through new ways of working at the top end of the market,” he said. “We’re not going to defend a business model that clients don’t want to have to pay for.”
Dawkins confirmed he had spoken to several outsourcing agencies, but said the outline proposal did not include details of potential job cuts.
He said: “We could get more work from clients and grow. It could be a way of enlarging our market share.”
In August last year, Clifford Chance announced plans to ramp up its offshore paralegal capacity in India, while Lovells and Eversheds have moved some business support functions to low-cost centres. All three firms have since slashed staff numbers in the UK.
A number of legal outsourcing companies have sprung up to meet increased demand, including Exigent, Integreon and Office Tiger.
Exigent director David Holme said: “Law firms are dipping their toes in the water. They want to build up a capability without having to employ people full-time.”
Simmons partners will vote on the new three-year plan this week.
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Readers' comments (46)
Anonymous | 28-Apr-2009 8:44 am
Before training to become a solicitor, I worked for a telecoms company that outsourced several functions to India a few years ago. It was a complete disaster.
By the time I arrived my responsibility was to help with the return of most of those functions to London, at considerable cost to the company.
The relief in the voices of the customers who had not taken their business elsewhere as a result of the diablolical standards of customer service experienced following the changes was palpable.
It beggars belief that the legal sector would fall into the trap of thinking that a move like this could actually save them money in the long run. All it will do is alientate their clients and make life more difficult for the staff who remain in the UK!
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FourChavsDishonourTheirFamilies | 28-Apr-2009 8:58 am
We all know what it's like dealing with outsourced call centres in India and wherever and this is going to be the exact same - cheaper service but poorer quality work.
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Matthew Record | 28-Apr-2009 9:46 am
The challenge to firms outsourcing work (whether legal or support) is to manage the process and quality so that clients still get the top-end service they expect and can benefit from the resuting cost savings that outsourcing delivers. The management team at Simmons, and any other firm considering this, would only choose this route if they felt it was a win-win situation for clients and themsleves.
Within 3 years I would expect most major firms to be outsourcing much of the process-driven work that junior lawyers regularly undertake and this can only be good for the careers of those lawyers.
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Anonymous | 28-Apr-2009 12:04 pm
I guess that Anonymous would exclude Lord Steyn and Lord Hoffmann from the list of South African lawyers that would fail to meet client expectations!
Simmons may be onto something. It can be expected that with the redundancies in the UK legal market it must also have influenced some of the many Saffer lawyers working for City firms. Why not employ them in SA (albeit indirectly) at a fraction of the cost they would be expecting in the City.
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T-Bone | 28-Apr-2009 12:24 pm
I guess it depends on what sort of work is to be outsourced: I assume Simmons will still put their PI cover on the table for clients and backstop the work?
I've been based in Asia for 8 years. A lot of our work is 'interfacing' with local counsel and, (putting it politely), it takes a huge amount of time and is frought with difficulties. Clients doing deals in the region understand this issue. I'm not sure that clients in an European context would have the same understanding...
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Anonymous | 28-Apr-2009 12:33 pm
Indeed, this is a great news from Simmons after laying off more than a hundred of associates globally on the pretext reducing costs.
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Advocate | 28-Apr-2009 2:12 pm
Having had experience in the states and Africa, i completely disagree with you Anonymous. I think the approach you have chosen to take displays your ignorance about jurisdictions other than your own. I wouldn't be at all surprised to find out that you have never dealt with a foreign lawyer on a cross border transaction or complex litigation. When you do, you will realize that lawyers who practice in foreign jurisdictions (many of who studied in Harvard, Oxford etc) are truly excellent.
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Anonymous | 28-Apr-2009 3:11 pm
I think there is something to be thought of here which is not whether India, S Africa or the other countries can handle this but is it fair to those in the UK who loose their jobs?
There are enogh competent and skilled individuals in those countries to handle the work and turn out quality product but yes their way of working and the use of language is different from what Europeans are used to. SO be patient....
And if the quality was really that bad then CC and the others wouldn't be so keen to have best friends alliances in India and continue to out source their work or retain foregin qualified lawyers from these countires.
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Anonymous | 28-Apr-2009 3:44 pm
As an in-houser I have previously worked for companies heavily involved in outsourcing some of their client orientated services overseas. In most cases it was a complete disaster and even if with the most stringent quality control procedures, the standards were not satisfactory and clients absolutely hated it and left en masse. Most of these companies were at some point contemplating how to get these services back on-shore.
Funny that the legal profession views this as an "innovative move" when a large proportion of the business world has wised up to the fact that you shouldn't underestimate your client's relations.
There are other ways to cut costs and if my current external advisers were enaging in outsourcing, I would most certainly reconsider their appointments.
Another thought: how will law firms source senior lawyers in a few years' time if there is no need for junior lawyers' now?
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Anonymous | 28-Apr-2009 4:30 pm
Why not outsource elsewhere in the UK to solicitors qualified in England and Wales? A cost saving would be achieved and clients would continue to benefit from English legal advice from English lawyers which is what they are paying for.
I know there are plenty of quality lawyers in RSA, India and Aus, but the vast majority of those lawyers will become partners in their own countries and maybe firms in the UK or US and will not want to work as agency staff for Simmons on lower wages.
The process will be problematic and I am sure the outsource agencies have been smart enough to ensure all liability rests with Simmons.
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