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Legal Management Organization

Control spiraling legal costs!
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Everyone talks about how much lawyers get paid these days, but most responses to the problem center on "tort reform," which would limit the rights of non-lawyers as much as lawyers. Your Uncle Nutsy, who used to be an accountant for law firms before he rejected Satan and all his works, has a better idea.

Thing is, most lawyers don't make anything like the amount the client gets billed. A moderately successful lawyer might make $90,000 per year and bill 3000 hours per year (over 8 hours of work a day, seven days a week, 365 days a year!) at $150 per hour- in other words, they keep a fifth of what they "earn." This is not unusual; I've seen ratios of less than a tenth, especially for junior associates and paralegals. Now, some of this goes for overhead, but the legal business isn't high overhead, except maybe in terms of downtown real estate. No, a huge chunk of the overages gets distributed back to the partners of the law firm, who pocket a lot more than they "earn," as some kind of reward for the business they bring in and for their earlier years of service.

Thing is, most legal matters don't require a partner with thirty years experience. Most legal matters scarcely require a lawyer; a paralegal can be sufficient.

So, for routine matters- government pleadings, contracts, wills, trust formations, etcetera- I give you the Legal Management Organization. Open an office out in the burbs, where things are cheaper. Offer associate lawyers and paralegals a premium of, say, 25 percent over what they'd make at a large firm, with a quota of only 2000 billable hours (40 hours a week, with two weeks vacation per year) in exchange for no chance of ever making partner. And, voila, you're in a position to hire away all sorts of perfectly capable legal professionals and still undercut law firms operating under the partner system.

Uncle Nutsy, Aug 02 2000

mycounsel.com http://www.mycounsel.com/
For truly boilerplate issues, sites (and software, and books) like this one offer a different alternative. [egnor, Aug 02 2000, last modified Oct 05 2004]

[link]






       I'd do it, all other things being equal, but only because I don't plan on remaining a lawyer long enough to make partner. Most of the law students I know would rather work the longer hours now in the expectation that it would pay off in the future.
bookworm, Aug 02 2000
  

       It may sound naive, but wouldn't it be great if the young lawyers and paralegals would jump at the chance of earning $80,000 a year ($40/hour) and at the same time do their community a favour by making legal services available to people who can't afford $150/hour services -- but can manage 3 or 4 hours at $50/hour?   

       Here in Victoria, BC Canada, legal aid is available only to people with a total household income of less than $30,000 CDN / year -- that's basically poverty. So if you're not below the poverty line, your only choice is to pay $150 to $300 CDN / hour for legal help. 10 hours of legal help can eat up an entire month's after tax income for many people -- How is that fair?   

       So what you're saying, Bookworm, is that the law students plan on knowingly participating in a career that they know will un-necessarily cause huge financial stress to hundreds of families over a 20 year period so that they, the young aspiring lawyers, will make the big bucks as a partner down the road. Wouldn't investing 20% of $80,000 to $100,000 every year for the next 20 years be a guilt free alternative?   

       Many lawyers have already driven themselves out of the real-estate conveyance business because notaries will do the same work cheaper.
eagle, Aug 02 2000
  

       I think most of the law students who plan on working for large firms expect their clients to be corporations rather than families. And if they feel guilty about that, they do a little pro bono work on the side.
bookworm, Aug 02 2000
  

       No. Can't possibly work. I hear the Mr. Nice Guy (elsewhere at HalfBakery) has obtained venture capital from IBM, GE, Boeing and the Salvation Army. Soon hordes of these Nice Guys (and Gals) will be unleashed in the hopes of vanquishing selfishness, spite and clumsiness. With such an unstoppable force at work, soon the entire continental U.S. will operate in complete harmony, and the erstwhile lawyers will be assigned tasks writing philosophy, fiction and poetry. Young lawyers, get out while you still can.
pathetic, Aug 23 2001
  

       Excellent idea. Of course, they're better off becoming business consultants, anyway. Same system, same rates, same salary, but no judges, no juries, nobody asking for pro bono work, no bar exam, and no punks coming out of ivy league consulting schools looking to make a name for themselves. Disadvantage: constant travel.
ConsultingDetective, Jan 30 2004
  

       Since 2000, this has been baked by a number of law firms, a notable recent UK example being Ashurst LLP setting up a Scottish wing which employs people //no chance of ever making partner// to do the low-value, heavy lifting work against a lower cost base, which means more money for your Uncle Nutsy.
calum, Jan 26 2015
  
      
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