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The Many Forms of a Law Firm

Image © Micu Radu

About The Author

Helen Morse (Writer)

Helen is studying Law (European & International) LLB at the University of Sheffield, now entering her final year having spent an Erasmus year at the University of Vienna, Austria. Helen is interested in international and commercial law. Outside of law, Helene is a keen sports woman, playing at county level.

We are well into the application season now and Keep Calm Talk Law has published a number of articles in recent months with the aim providing relevant information and advice for those seeking to obtain vacation schemes, training contracts, mini-pupillages and pupillages. This article is going to give an introduction to the different variety of law firms and highlight points to consider when deciding which type of firm to apply to. In applications and interviews, it is not only important to have a general appreciation of the landscape of the profession you want to enter, but also demonstrate an understanding of the work, culture and expectations of the firm you are specifically applying to, as Chris Bridges noted in his article ‘Commercial Awareness: Defining the Undefinable’.

The legal profession is going through a time of great change, having to adapt to globalisation, changing client needs, continued economic pressures and advancing technologies, (see Jade Rigby’s article published late last year on the biggest challenges facing the legal profession in 2015 for further insight). Even a few a years ago, the different types of law firms could be neatly pigeon-holed and their work easily categorised. However, this article will demonstrate that, as a result of this ongoing development, the distinctions between different types of law firms has become more difficult to define. Equally, alternative legal structures and training models are now emerging, different from the set-up at a traditional law firm, opening up new opportunities for the future generation of lawyers.

International Law Firms

International law firms, as the name suggests, provide a full range of legal services for global business and industry. International law firms can typically be divided further into UK headquartered, non-UK headquartered firms and ‘hybrid firms’.

UK Headquartered Firms

Within this category fall the famed ‘Magic Circle’ firms (Allen & Overy, Clifford Chance, Freshfields Bruckhaus Deringer, Linklaters and Slaughter and May), ‘Silver Circle’ firms (Herbert Smith Freehills, Ashurst, BLP, Macfarlanes and Travers Smith), and many others. Although based in the UK, firms of this variety will have offices worldwide as well as, or at least, very strong associations with other firms around the world.

Non-UK Headquartered Firms

A number of American firms have set up large offices in the UK, with many offering experience and training contracts to would-be UK lawyers. Examples include Jones Day, Kirkland & Ellis, Baker McKenzie, K&L Gates and many others. Famously, firms of this breed pay very generously and offer its trainees a lot of responsibility. However, understandably, with this comes high performance expectations and typically very long hours. These firms are very much international in nature, and some prefer this focus, rather than being labelled as an ‘American law firm’.

Hybrid International Firms

These types of firms, although with UK offices and still financially separate, are part of a much wider global group, typically sharing the same management board with other members coordinating their activities and services. Examples include DLA Piper and Hogon Lovells (with UK and US partnerships); Slater & Gordon (with Australian and UK partnerships); and Norton Rose Fulbright (with five global members). The above firms, although part of a group, are financially separate, whereas CMS Cameron McKenna, part of the wider CMS group, is not.

The Considerations

Regardless of where they are based and their ownership structure, the features and considerations remain largely the same. With international weight comes a career with very good opportunities for travel and day-to-day dealings with multi-national clients. The type of work international law firms engage with will often be challenging and demanding, but equally of a high quality and of the kind likely to feature in newspapers like the Financial Times.

The work of international law firms is inherently commercial in nature, being dominated by the areas of corporate and finance. Although, there are exceptions; firms such as Slater & Gordon are full service and several other international firms offer private client work complimentary to their business services, a key example being Macfarlanes. Generally, however, if your interests lie in the work more associated with acting for private individuals, then an international law firm may not be the firm for you. If you are motivated by the transnational and cutting-edge calibre of the work associated with commercial law, though, then working for an international law firm will make for a very rewarding career as they are amongst some of the leaders in this area of law.

The multi-specialist approach of many international law firms, covering a wide range of industries and sectors, will ensure comprehensive and well-rounded training to begin any legal career. It is worth noting, though, that the larger firms of this type, such as the Magic Circle and American firms, can take on up to 100 trainees each year and, due to their large scale, there is always a risk of you becoming a small cog in a very large operation. I say this with caution, however, as many large firms emphasise their commitment to nurturing and progressing the career of their lawyers, for instance Hogan Lovells typically appoints partners from within their own ranks, and many other international firms take on far less trainees. This highlights the importance of doing your research and making any application firm-specific.

National Law Firms

Firms that fall under this category focus primarily on single-jurisdictional work for mainly UK public and private companies. Examples include Addleshaw Goddard, Burges Salmon and Shoosmiths. Compared to international law firms, national law firms are not exclusively commercial, with many offering private and business services, however it does largely dominate their work.

It should not be mistaken that these types of firms have no international presence, however. In fact national firms are increasingly engaging in multi-national work and some have loose international affiliations as cross-border trade is increasingly becoming the norm. Globalisation is arguably spelling the end of national law firms as we traditionally understand them, meaning there are now increased opportunities for future lawyers to engage in international work outside of the larger international law firms.  

Another great attraction to national law firms is that the calibre of work and reputation of the firm as a whole is arguably just as high as international law firms but the emphasis is just more on domestic work and clients. However, an unwelcome consequence of this to bear in mind is that you can be working just as hard and for the same amount of hours, but for a lower salary than can be achieved in an international law firm.

Regional Law Firms

Regional firms, like national firms, will typically have several offices, but instead concentrated in one region of the UK and often outside of the capital. The work is therefore centred on catering for regional clients, meaning they often offer private client services as well as conducting commercial work. Equally, larger regional firms are increasingly dealing with overseas parties, as it is becoming more common for even regional businesses to have international dealings. This is a great advantage for those who aspire to having a legal career with an international element, as it means the choice of firms is no longer only limited to international or very large national firms.

An advantage of training in a regional firm often cited is being in a smaller team, entailing more personal interaction with partners, a broader experience and increased responsibility. Even though salaries may be lower than those of the city, it is worth remembering that so too is the cost of living. Likely because of the above-mentioned reasons, obtaining vacation schemes and training contracts in regional firms are just as competitive and certainly not an easy option. It is also important to note that it is not uncommon for regional firms to ask applicants to specify their links to the area, so really think about how you can show your dedication to that firm and region, especially if your only link is attending university in the area.

There is a wide-spectrum of firms within this category, some with many offices or some with only a few; some focusing more on private clients whilst others remain quite commercial. Therefore, it is really important you do not just send out generic applications and instead show a genuine interest in the specific firm and location you are applying for.

Niche/Specialist Law Firms

Niche law firms offer highly specialised work in very specific areas of law, from Harbottle & Lewis specialising in media law, to Davies Johnson & Co., a specialist shipping and commercial law firm based in Plymouth. This means some niche firms cannot offer training contracts as they cannot provide a sufficiently broad training experience. Additionally, often these firms cannot support taking on a trainee, so training contracts may well be on a case-by-case basis rather than through an annual recruitment drive.

However, if you have a passion for a particular sector, then a niche firm would be ideal in ensuring highly focused and innovative work in that field. You must be sure you definitely want to work in that specific sector, though, as training in a niche firm can limit your career prospects somewhat to that specialised practice area. Then again, the nature of being a specialist can come with high rewards as your individual expertise and bespoke advice will be in great demand. It is worth remembering too that many firms offer paralegal work, so this may be an alternative avenue of gaining experience in a specific area of interest to you without, or before, committing to a training contract.

High Street Firms

There are a wide variety of firms that fall under the bracket of a “high street firm” and sweeping generalisations should not be made. However, apart from their location, what largely distinguishes high street law firms from the ones already discussed is their core practise areas. They primarily act for private individuals, focussing on areas such as family; criminal; wills and probate; and conveyancing. If you desire a career with lots of face-to-face contact and where you can easily see the direct impact you have had for your client, then you may be more suited to a high street firm.

Traditionally, high street firms were independent operations, running from one or two local offices. However, many firms of this category have come under a lot of financial pressure in the last few years. Consequently, it is becoming more common for high street firms to join a network or franchise-like operation, benefiting from the increased resources and exposure that can come with a joint brand. QualitySolicitors is a prominent example of this as the largest network of local law firms in the UK.

It is worth noting that a large proportion of the work high street law firms carry out is funded by legal aid, especially in criminal law. However, the recent government cuts to legal aid are threatening the work traditionally undertaken by high-street firms. Equally, the rise in ‘DIY’ legal kits is also arguably cutting into the common everyday work of high-street lawyers (a quick google of ‘DIY wills kit’ took me straight to one offered by WHSmith, only costing £16.99).

However, this should not necessarily put you off working in a high street firm. It is true that the dynamics of the work may be changing and some firms will have to think about diversifying in order to fund their future, however it could be very exciting to enter a high-street firm at this time as you could be directly involved in developing and changing it. What I would say, though, is make sure the firm has a clear strategy for the future, or at least is open about their need to adapt to this changing legal market, before committing to training with that firm. As a side point to think about, the SRA’s (Solicitor’s Regulation Authority’s) minimum required salary for trainees was scrapped in August of this year, so employers now only have to adhere to the national minimum wage, which is likely to affect the salaries of trainees in high-street firms the most.

Due to their smaller size, high street firms will often not have any formal work experience schemes or offer regular training contracts. Getting your foot in the door in these types of firms may have to be done through unpaid work experience; a contact; or starting out as a paralegal, before being offered training with the firm. This is not necessarily a negative, however, because the experience gained before committing to a training contract can be invaluable and act as a way to make sure a legal career in that type of firm is definitely for you. It is also more likely that in high street firms, where perhaps you are well known before you even begin your training, you will have easier access to the senior staff and more personalised training, both key factors in aiding your career development.  

In-House Legal Teams

In-house lawyers work for one organisation and manage the majority of its legal needs. Commercial organisations are usually the main employers of in-house lawyers, however an increasing number of non-profit organisations are hiring lawyers to work in-house, such as The Big Lottery Fund and Sport England. So, although you will not be involved in the front-line of services offered, being an in-house lawyer for a charity, for example, will mean you are critical to the smooth and efficient running of that organisation as a whole, which for some may make for a more fulfilling career.

The work of in-house lawyers can be quite diverse when compared to working for some legal firms, but its nature is very much dependant on the size and type of organisation. In-house lawyers will, for example, need to ensure the organisation is compliant with any relevant laws; be familiar with all aspects of employment law; manage and instruct outside legal counsel; as well as having any specialist legal knowledge relevant to the organisation. In recent years, as organisations have become more cost-conscious, in-house legal teams’ spending has come under increased scrutiny and many have had to downsize their permanent staff. This is not to say they are necessarily giving more instructions to law firms, though; many in-house teams make use of outsourcing services, such as Allen and Overy’s Peerpoint. Equally, efficient management of an in-house legal department is critical to the success of any organisation and highly valued, thus opening up new opportunities for lawyers with a business accruement to rise up the ranks of an organisation and even sit on the senior management board.

Traditionally lawyers would move to in-house after completing their training and gaining experience in private practice. However, more and more organisations are offering training contracts, such as EDF Energy, Tesco and Vodafone. This may be something to consider if you feel you will be driven by being directly involved in the direction of your “client” and being able to see first-hand the results of your work. Plus, an added bonus for working in-house can be access to company package benefits, such as discounts, pension schemes and private medical care.

Alternate Business Structures (ABS)

Within these different models sits a new form of law firm: an ABS. Again, generalities should not be made, as this category is differentiated by the ownership and structure of ABSs rather than its work and culture. I will not attempt to detail all the specifics of ABSs, as a whole article could be dedicated to this new form of firm, but I hope to give a brief outline of them to highlight the career alternatives they offer.

ABSs were introduced by the Legal Services Act 2007 and essentially they allow non-lawyers to have a financial stake in a law firm, either as a manager or through an ownership interest in the firm. The main benefits of a law firm being an ABS is that equity can be raised from a broader base of potential investors and they have the ability to diversify the range of services they offer. Several ABSs are actually familiar established law firms, the most significant example being Irwin Mitchell, who was the first top-50 UK law firm to become an ABS. The firm would no doubt argue that being able to appoint non-lawyer executives, such as the ex-CEO of PWC, Glyn Barker, is one of the greatest benefits. Lawyers are often not the best-qualified people to be running a business; therefore being able to bring in somebody with comprehensive business expertise can provide a vital competitive edge.

The market has not been flooded with non-legal organisations diversifying into legal services, as some feared may happen. Where they have entered the market, most are being rather conservative, simply supplementing the services they already provide. An example of this is car insurance specialist Admiral who now provides advice on claims arising from road traffic accidents.

However, accounting giant PWC has a rapidly growing legal services branch with their principal practice areas being very similar to what traditional commercial law firms offer. If this service continues to develop at the same pace it has thus far and other accounting firms decide to follow suit, then this could be a significant threat to the work of city firms.

The supermarket Co-op is the most well talked-of non-legal organisation to offer legal services and it has ambitious plans for its Co-operative Legal Services (CLS), but it has not got off to the best of starts, announcing millions of pounds of losses and many redundancies in its opening years.

Proponents of ABSs argue they are well placed to weather the current changes to the legal market as they offer flexibility and their set-up is more suited to changing client demands. A great example of a forward thinking ABS is Riverview Law which highly promotes its business model being built from the customer up, not the law firm partner down. If you were to begin your legal career in an ABS, then it seems clear you would be safe in the knowledge that the firm is open-minded to the future and likely has clear plans in place to continue their growth, which not all more traditional law firms will genuinely have. In terms of training in an ABS, thus far it seems very similar to training in any other law firm. The SRA training guidelines apply to ABSs too, so trainees must be supervised by qualified lawyers or others with the appropriate experience; experience at least three different areas of law; and still sit the Professional Skills Course.

Something Entirely Different

Lastly, an alternative model for training contracts that does not depend on securing one with any law firm at all is Accutrainee. Accutrainee itself recruits trainee solicitors and seconds them to law firms and in-house legal teams in accordance with the firms' requirements and the trainees’ career interests. The number of firms that a trainee works for and the duration for which they are seconded very much depends on the type of firm the trainee wants to work for and the type of availability the firms have, but generally they last for six months. Near the end of the training contract Accutrainee will contact the firms the trainee has been seconded to in order to determine whether they will be offering the trainee a newly qualified position upon qualification and offer support during this process.

This model offers an opportunity to work for more than one law firm and/or in-house legal department throughout the course of the training contract. As Accutrainee itself cites, this could give you better insight in determining the type and culture of firm which best suits you. Also, crucially in today’s market, you will gain experience and skills in adapting to different working environments, colleagues and clients. This is a relatively new route to qualification as a solicitor in the UK and, as there often are with any new initiatives, there are concerns that a two-tier system of trainees will emerge. However, this year the first two people to go through the Accutrainee program landed newly qualified positions – so it is one to watch.

Conclusion

As you can see, there is a wide spectrum of legal opportunities for aspiring solicitors. It is critical to understand the different varieties of law firms and routes to qualification to ensure you end up training and working in the right environment suited to you. As I have tried to emphasise throughout: generalisations cannot be made and many law firms will reject being put into any category at all. Once you have an overall, rough understanding of the variety of firm you want to work for, specific research is crucial in order to demonstrate your commitment to working for that type of firm and to determine the best route for you to get there.

Further Reading

Law Firm Application 101: Maximising Your Return

Commercial Awareness: Defining The Undefinable

Oil Prices and Your Commercial Awareness

The Biggest Challenges Facing The Legal Profession In 2015

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Tagged: Legal Careers

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