Tuesday, May 19, 2015
In my last post, I asked whether business leaders had unknowingly provided the legal industry with a long-term solution to declining interest in the legal profession (based on the drop in applications to law school) and potential waning influence. I suggested that business leaders (inadvertently or otherwise) may be the driving force that ends up saving the legal profession. I would like to take the discussion one step further.
There is no doubt in my mind that, historically, companies rarely did much legal training for the lawyers they hired. They simply bought talent—usually by offering employment to attorneys with private practice experience that was valuable to the corporation. Sometimes this worked extremely well, and sometimes it failed miserably. Why? Business leaders sometimes possess only basic knowledge of what quality legal talent really looks like (after all, they usually are not lawyers themselves). Moreover, they often have difficulty finding a lawyer who can operate in a corporate environment and have high-level legal skills. The “a lawyer is a lawyer” mentality still prevails.
Adding to the difficult situation is that private firm attorneys often view corporate attorneys as those who could not flourish in private practice (for whatever reason—lack of skill, drive, ability, focus, etc.), and they consequently may be perceived at times by their own companies as somewhat suspect (“If they were really good attorneys, wouldn’t they be practicing with a firm?”). It becomes a Kobayashi Maru-type of character test for such in-house attorneys—virtually, a no-win situation. They are hired to help, but at times not fully trusted to do so because they are on staff. Professional respect, and compensation, for in-house attorneys lags behind that for lawyers in private firms.
Corporations are struggling with the concept of attorneys as part of entrepreneurial teams. Few companies hire law students directly out of law school for the very same reasons that firms are currently limiting their new-hires—lack of return on their dollar. Lawyers take 5-15 years to build the experience necessary to obtain the “gravitas” needed for a high level of trust, depending on the field. Many lawyers never achieve this status; they are simply caught in an eddy of repeating activity. (Perhaps this issue is worthy of a separate post!)
At this juncture, the in-house path remains precarious, and pursued at one’s peril. At most companies, there is no specified legal track, unlike the well-worn management paths. Many corporate legal positions are much lower paying than firm jobs, and often of the “J.D. preferred” type of position—helpful to be a lawyer, but not necessary. Graduating law students usually do not choose this corporate path—it is chosen for them, as they graduate from lower tier law schools, have less than stellar grades, or perhaps due to personal obligations involving location or family. Perhaps such students never had a great desire to be lawyers, drifting into professional school through lack of other opportunities. Additionally, inside companies, non-lawyers often feel that their in-house attorneys are a form of threat, and sometimes attempt to undermine them.* Advanced education continues to be viewed, probably irrationally, with some suspicion in the business environment. Perhaps because the lawyers presently in-house have offered little to benefit the business operations, or because they are just not well understood.
These attitudes appear to be changing. As the legal environment continues evolve, students may actually enter law school for the specific purpose of being in-house counsel, perhaps even having a specific company or industry in mind prior to taking their first class. Law schools are well advised to shift their focus to accommodate this new reality. Law schools that play the game well will again become a dominant option for bright college students. What does this future look like? That will be the subject of my next post. More soon!
--Marcos Antonio Mendoza
*Interestingly, I have never heard a single MBA joke (has anyone?), but frequently hear lawyer jokes. However, many millennials report to me that lawyer jokes are no longer de rigueur around them—in other words, people feel sorry for them and the challenges they face!