The recruitment dimension

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With the Legal Services Act reforms on the horizon, Colin Loth, Manager of Legal at international recruitment consultants Badenoch & Clark, discusses the impact the Act will have on the job market and talented legal professionals

Loth: candidates will need to be flexible and open-minded in the new legal world

Since the Legal Services Act is not yet completely in place, the full extent of its implications on the legal sector remains difficult to predict. One thing is certain: its effects will be complex and far reaching. However, with the right approach, professionals will be able to capitalise on this changing landscape to protect their current and future career.

The Act will allow many law firms to change their business structure, which will mean that rapid change across the profession is likely. Employees from partner level to trainee must adapt and be flexible in order to keep up with this increased momentum.

The impact on firms

It is also probable that we will see a greater emphasis on commoditisation and standardisation for low-level transactions. This will have the greatest impact on mid-sized firms, which will need to demonstrate heightened efficiency. They will most likely look to achieve this by driving costs down which they can pass on to customers, as well as appealing to external investors by exhibiting slick and streamlined operations.

These mid-sized firms are still expected to maintain a number of specialisms in operation within their practice. However, this will open them up to competition from alternative providers such as retailers, widely speculated to be the big contenders amongst high street names, who look set to get involved in accessible, low-level family, matrimonial, personal injury, probate and property law.

Smaller firms are likely to compete with this model by either focusing on one niche specialism or merging with other small firms. Simultaneously, larger city organisations, although not in direct competition with these small- to mid-sized firms, will certainly feel the scrutiny of the outside investors. Calls for transparency of the inner machinery of the firms of interest to investors will again demand heightened rigour and efficiency.

The impact on recruitment

In all sizes of firms these changes will impact on recruitment and retention. Trainee lawyers are in a good position to benefit from the altered market, since they are by definition the more malleable and adaptable components of the workforce, so will be capable of embracing all opportunities available.

At the same time, hiring for non-legal roles may increase, as new business structures will permit similar incentives for non-legal as for legal staff, making it easier to attract high-quality candidates.

Established employees may find themselves facing extra pressures with which they are unfamiliar. For instance, now more than ever, firms will need to demonstrate to their clients the true value they can bring. Those who embrace these changes and adapt to the new pace will be well equipped to seek out opportunities early on and flourish as the market changes.

The key to success – at any level – is flexibility and a willingness to embrace change.

In terms of recruitment, it is likely we will see employers focus on a wider skill set. For instance, the drive for efficiency may see outsourcing of lower-level transactional legal work and alternative billing methods, particularly amongst mid-sized firms. Employers will therefore be looking for individuals with managerial skills who can manage paralegals or external providers tasked with this work.

Additionally, commercial awareness and business skills will be essential tools needed by candidates and employees alike in order to thrive in the newly competitive environment with its emphasis on fiscal return.

The Legal Services Act certainly looks set to shake up the legal sector, and there is potential for professionals to experience some dramatic changes. We would recommend that both candidates and employees should seek a thorough understanding of the impact of the Act on their specific organisation and role. This will give them the knowledge to devise an appropriate personal strategy suiting their skills and their employers.

Ultimately, those who do this, while maintaining an open-minded and opportunistic attitude and a willingness to embrace change, will enjoy a long and successful career.