The legal services industry, along with much of the country, is coming to terms with the reality that COVID-19 is not the short, temporary interruption many had hoped. We are beginning to see law firms make more permanent adjustments. Headlines in publications like the American Lawyer are already highlighting the acquisition of stars in hot practice areas, but what won’t be included in the press releases is what will happen to less-desirable practices areas and less-favored attorneys.
While winners in bankruptcy, internal corporate investigations, and healthcare may be sought after right now, a larger number of attorneys work in areas of litigation and transactions that are slowing down. Behind many announcements of new partners will likely be untold stories of other lawyers at those firms who have been demoted from the ranks of partner or had their compensation reduced.
Through the end of the year and into the first quarter of 2021, we expect to continue seeing attorneys who represent certain industries, such as retail and hospitality, suffering severely. Lawyers whose work is focused on serving these industries should start to create options for themselves now. Many partners, regardless of the clients they serve, will need to consider making a move during the first quarter of 2021 when bonuses are usually paid. Given the magnitude of the economic, societal, and health-related changes that are buffeting our lives, some lawyers who have always felt secure at their firms will find themselves looking for an exit in the months to come.
While we may be in physical isolation, this is not the time to isolate from one’s network. For non-equity partners whose clients have been hit especially hard, avoid the temptation to wait for the bad news to come to you. Likewise, it’s a sign of intelligence, not weakness, to begin identifying allies with whom you can discuss forthrightly your situation and your concerns.
By starting the process now, attorneys can give themselves the time to cultivate strong relationships within their networks before asking for any favors. This is also the moment to be present for one’s existing clients through the hard times. When economic activity returns to more normal levels, the demand for legal professionals will return for a vast majority of lawyers. But non-equity partners first need to cross some very choppy waters.