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 5:16 pm
Well, that's the end of employment prospects for people who complete a law degree and fail to secure a training contract. Bye bye paralegal jobs.
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Anonymous | 28-Apr-2009 5:22 pm
They outsource the janitors and I said nothing. They outsourced the security guards and I said nothing. They off-shored the data input clerks and I said nothing. They off-shored the client care call centres and I said nothing. They off-shored the software developers and I said nothing. They off-shored the tax form prep work and I said nothing. Now they are off-shoring "junior" legal work, and we'll probably say nothing.
When they come to off-shore most of the rest of us, who will be left (employed) who can say anything?
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Anonymous | 29-Apr-2009 10:10 am
Speaking as an inhouse lawyer who regularly uses outside law firms, I can say without question that the quality of legal advice and work from lawyers in SA or Australia/NZ is the equal of any I have instructed in the City with the considerable advantage of less cost and less risk averse advice. Simmons are doing exactly the right thing by their clients (provided they are up to the management challenge)
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Anonymous | 29-Apr-2009 3:05 pm
I am qualified to practice in England and Wales and Nigeria and work with solicitors from the top UK firms on a regular basis on cross border transactions (usually on oil and gas transactions) and I think that the quality of work from the top Nigerian firms is as good as you can get anywhere. I have also interfaced with South African firms and have found them to be excellent. I think the first poster should get his head out of the sand and appreciate that there is a lot of quality outside England and Wales.
Outsourcing may be cheaper but cultural factors should also be considered. For instance I relate to a German client differently from a Nigerian client. Outsourcing tends to come with a 'one size fits all' approach that may be detrimental in the long run. Again as suggested by an earlier poster, why not outsource to Wales or Scotland where the wages are lower?
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Rob Millard (Edge International) | 29-Apr-2009 4:33 pm
"Anonymous @ 27-Apr-2009 11:39 am" has certainly prodded a hornets nest with his poor opinion of South African lawyers. I agree with the other commentators .... there are some truly awesome SA law firms whose work is easily equal to the best anywhere. Like in any market, though, there are also below-average SA law firms and lawyers, too. The charitable explanation for "Anon's" view is that he has experienced the latter but not the former.
My prediction: a single global market for legal services is almost certain to evolve over the next 5 - 10 years, irrespective of current / historical obstacles. The drivers are compelling. Get used to it .......
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BadgerHaggle&Bill | 29-Apr-2009 4:59 pm
The quality of lawyers at top foreign firms may be every bit as good as the English firms but the work isn't being outsourced to top firms from what I understand, it's being outsourced to cheap agency staff.
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Seán Mac Cann | 29-Apr-2009 5:16 pm
How long until overseas lawyers wise up and push up their prices to just below Simmons'? Or until a downwards-spiral bidding war for this work breaks out among overseas law firms? This is applying a short-term sticking plaster to deeper, unaddressed over-lawyering problems in current litigation and due diligence work.
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Anonymous | 29-Apr-2009 5:22 pm
Why is everyone who thinks this is a good idea so keen to send their jobs overseas? If this plan works then why have any lawyers in the UK at all? What reason can there be not outsource everything to a lower cost centre? If jnr lawyers overseas can do the same job as jnr British lawyers then, logically, snr lawyers overseas can do the same job as snr British lawyers at a lower cost. On this basis there is no reason to have more than a few client facing lawyers in the UK; the rest of us can be made redundant whilst everything is done overseas.
Also, why do those who like this idea seem to assume that it will not be their work that is sent somewhere cheaper?
Finally, how will you train jnr lawyers if there is no work for them to do because it is all being done at the lowest possible cost outside the UK?
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Anonymous | 29-Apr-2009 5:29 pm
Interesting reading! Of course there is always the other option of already extremely well paid partners doing something novel like reducing their charge out rates. Heaven forbid!
Outsourcing is all well and good, especially for clients but once it has started where does it stop? One day its due diligence the next your house is being bought and sold via Mumbai, all in the name of cost reduction and increased profits per partner.
If it proves successful might it be renewed in three years time only this time include all lawyers bar a lucky few senior non partners?
Whilst I can see some benefits to globalisation leaving trainees, and junior to mid ranking lawyers unemployed is not one of them especially in the current economic climate. Home grown talent needs to be nurtured and maintained for the long term.
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Anonymous | 30-Apr-2009 5:49 am
Fascinating....
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