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When to Hire Outside Counsel

Handshake after good cooperation, Consultation between a male lawyer and businessman customer, tax and the company of real estate concept.
By William Vogeler, Esq. on April 24, 2019

When do you hire outside counsel? It's not a trick question.

Lawyers typically answer "it depends," but it doesn't have to be that complicated. You can break it down into two answers: You hire outside counsel only when you can't do the work in house. Otherwise, hire outside counsel when you have no better choice.

Do the Work In House

As in any legal representation, attorneys have to start with the client's best interests in mind. That means doing the work competently, efficiently, and cost-effectively. For profitable companies, that bottom line really matters. They need legal departments to do as much work internally as they reasonably can. After surveying 180 in-house legal departments, the Corporate Executive Board discovered efficiency trends that every in-house lawyer should watch. They include:

  • Spending most of your budget in-house
  • Using more on-lawyer professionals
  • Hiring a legal operations manager
  • Investing in legal technologies

Of course, there comes a time when even the most talented lawyers just can't do the work in front of them. That's when it's time for general counsel to hire outside counsel.

No Better Choice

It's about choosing the best law firm or other legal alternative for the task. These days, savvy businesses know all about alternate legal services. For them, it's still about legal spend. In-house counsel have to watch the budget for outsourced services. Before hiring outside counsel, here are three suggestions:

  1. Reduce the number of law firms
  2. Use smaller firms more often
  3. Consider alternative fee agreements

In any case, don't outsource the whole legal department. Hire and develop people with the expertise to keep most work in-house. Then you might find  the time to hire outside counsel is when you bring them in house.

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