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Train Your Lawyers to Discuss Fees

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Managing partners and other law firm leaders can be reluctant to allow junior lawyers to discuss fees with potential clients. One of the recurring concerns is that the associate might commit the firm to fees that are too low. And some firms are gun shy about discussing hourly rates because of what those figures might reflect about associates’ compensation.

As consultants to law firms, we have seen firsthand that keeping lawyers in the dark has its own disadvantages. Notably, questions about fees routinely come up in discussions with potential clients. Thus, firms who seek to improve the rainmaking abilities of their more junior lawyers should strongly consider providing more training on how to talk to potential clients about fees.

Specifically, the training should address the following five questions:

 

1) What can associates tell potential clients about basic rates?

For firms that charge by the hour or on a flat fee basis, the best practice is to train associates to mention a fairly broad range rather than quote a single number.

2) What can they say about the firm’s position on alternative fee arrangements?

When asked about their firms’ openness to alternative fee arrangements, most junior lawyers answer with an “I don’t know.” This can leave a bad impression on potential clients and referral sources. Advise mid-level associates to instead communicate to clients that the firm evaluates fees on a case-by-case basis and would consider an alternative fee arrangement. It might be appropriate to provide associates with a sense of the firm’s willingness to charge blended rates, as well as some guidance around RFPs, contingency fee cases, and other special circumstances.

3) What should they convey about the process of providing quotes?

At every level, lawyers should know enough to tell their potential clients how fee decisions are made (by committee, by the head of the practice area, etc.) and when (an approximate timeline). This may seem simple, but firms often fail to offer this kind of guidance, thereby leaving the potential client in the dark about when they can expect to receive a specific quote or fee agreement.

4) To whom should associates mention a lead?

If a junior associate meets a potential client, what’s their next step? Do they report this to the billing partner, the head of the practice area, the managing partner? Make this clear. You don’t want to lose out on a valuable matter because one of your lawyers didn’t know whom to tell so that the firm could follow up.

5) What has happened with other matters the firm was pursuing?

Share success stories with mid-level associates (and special counsel and non-equity partners) so that they can incorporate the same strategies into their own interactions and learn to bring in new business.

 

This training shouldn’t just be about what to do but also about why those methods work. Well-designed training should provide lawyers with the confidence to communicate effectively about the firm’s fees.

Strategies for Managing Your Remote Law Firm Workforce: Preparing for Disruptions

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As we wrote about last week, COVID-19 probably isn’t going away in the next few months. Beyond adjusting your firm’s workflow to a fully or partially remote system, there are other facets of the pandemic which should be considered in your management decisions right now.

In today’s post, we’re bringing attention to a huge potential for disruptions that the current situation carries with it. Your employees or their family members may themselves get sick with the virus. Others will suffer from stress and anxiety related to fulfilling their work responsibilities while caring full-time for young children. Some will feel the effects of depression more severely as their worlds are turned upside-down.  We have already seen law firms with attorneys who have come down with COVID-19 and, weeks later, reported that they still couldn’t focus or pay attention normally.

There is a myriad of reasons for which people on your staff may not be able to continue working as expected, but the implication for management remains the same. Firms should be preparing now for those possibilities.

We recommend three basic strategies for setting your firm up to handle these types of personnel disruptions.

First, increase training to create some overlap between multiple team members in their knowledge and skills. Then, if one has to take time off or reduce hours, you have redundancy built in to smooth the transition of their tasks.

Second, identify people and scenarios where the risk of failure would have far-reaching consequences. This is a standard risk-management exercise and includes scenarios such as the temporary loss of key performers. This is where key person insurance would be beneficial except that insurance companies are largely balking at covering business interruption claims or other claims related to COVID-19. So that makes finding back-up personnel a high priority. Specifically, identify lawyers such as solo practitioners and litigation paralegals who could step in should your essential people become unavailable.

Third, rigorously document systems and standard operating procedures. Too many law firms operate on the assumption that the person who has some knowledge trapped between their ears will always be available to share that information. Whether that’s the password to your online banking account, a list of your twenty most important clients and their contact information, the procedure for an administrative assistant to open up new matters in your billing and document management systems, or the process for getting client checks deposited when the mail is taking eight days to deliver letters that used to arrive in two, put this information in writing. And just as importantly, have at least two people who can access that information in the event something happens.

When COVID-19 started, it may have felt like a series of major, rolling earthquakes. Six months later, we have lost the right to be surprised by the fact that pandemics are disruptive.

Should You Hire a Graduate of the Law School Class of 2020?

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California has joined the ranks of states temporarily allowing law school graduates to practice under the supervision of licensed attorneys without first passing the bar exam. This unprecedented situation gives rise to two related questions: Should you hire a graduate of the class of 2020? And if you do, how should you employ them?

The decision to hire any lawyer, including one fresh out of law school, should be client-centered. Some firms might be tempted to take advantage of the lower cost of a recent graduate. And too many firms hire (or decline to hire) out of habit. Given the economic uncertainties, it is critical to determine what your firm needs to serve its clients.

Too many law firms skip the seemingly bureaucratic step of writing detailed job descriptions that identify what they need from each role. Focus on the first six months.  This analysis might lead you to the conclusion that an experienced paralegal could deliver more for your budget than a freshly graduated lawyer. If you’re looking to delegate some of the workload initially taken on by partners so that they can instead dedicate more time to business development, that role may not require a law school education.

If you do determine that it’s in your firm’s interest to hire a law school graduate with essentially no experience, you need to be prepared to devote much more time and many more resources to training and onboarding than most firms are inclined to. As consultants to law firms, we often hear partners say that they want lawyers to do things in a very specific way and to also work with little supervision. This sentiment is the hallmark of poor management.

One of the biggest and most common mistakes firms make with new hires is failing to give timely and detailed feedback on the work product they turn in. If a new associate prepares a document and then the partner in charge of the case makes changes to it, that associate should have the chance to see what was changed and learn the reasoning behind it. If you want to maximize the impact of such training, don’t wait for a formal performance review.

Given that much, if not all, of the communication with new hires will now take place remotely, it is especially important to carefully select work assignments for new lawyers.  Ideally, you want to train a new lawyer with respect to skills that they will use repeatedly. If you include the time it takes to explain a project to a new lawyer and then to review and correct their work product, it is very likely that you could do it faster yourself. But that becomes less true as that lawyer completes similar tasks. That fact leads back to the question of the need to hire: Do you have enough work of a similar nature that will serve your clients?

If the answer to this question is yes and you are committed to training and communicating virtually, a graduate of the class of 2020 might be a good fit for you.