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THE THIRD WAY

In-house or private practice? Received wisdom puts this as the binary choice facing lawyers. But both roles place huge and increasing demands on time, and for many, managing their schedule is a receding dream. Does it have to be this way?


C A R E E R     P A T H

CATHERINE McGREGOR

EDITOR AND FEATURES WRITER

Former Airwave GC and company secretary Rachael Davidson is one of a growing breed of UK lawyers who might have cracked the conundrum. For nearly a year she has been working as an interim GC for an alternative law firm. This provider, Halebury, describes itself as a supplier of ‘external in-house lawyers’. Could this new model be blurring the line between internal and external counsel while also allowing fully flexible working?

GC’s Catherine McGregor catches up with her to find out more.

Evaluating the options

GC: Can you tell me about how and why you made the move away from a full-time in-house role?

Rachael Davidson (RD): My last full-time role was for a company called Airwave which provides the private radio network for the emergency services – so it was a really varied role with a really interesting set of clients. After five years as GC I decided to take voluntary redundancy during the company’s restructuring, and focus on things in my life outside work. The CEO and I spoke about a whole load of options including job share but I decided to leave, and, for six months I didn’t work. After the summer, I decided to look around at options and did a bit of ad hoc consulting for people I had worked with in a previous role at O2. I got the recommendation to Halebury from my sister, also a lawyer, who knew another lawyer who had gone to work there with a similar life set up to me – she had young children but still wanted an interesting mix of work and clients.

The model is really appealing because it’s a mix of well-known blue chip clients and smaller clients who you can really have an impact on. We’re experienced, capable, senior lawyers and most of us on the team have over fifteen years of in-house experience, so we can pretty much go in and tackle almost anything.

A member of the team

GC: How does it work exactly?

RD: Within Halebury there are a few ways of working. The majority of our clients have massive legal teams – BT, Virgin Media, a number of big banks. We slot into their resourcing requirements, working on or off-site as needed. We’re currently covering a senior lawyer’s maternity leave at a large bank. In either case you become a member of the in-house team, and they trust you to act in the same way as their in-house lawyers and in the best interests of the business. You might even manage other external law firms. I have a couple of colleagues that work for Expedia on transactions, which means briefing external lawyers.

The other model is for small clients, the SMEs who don’t have the financial means or requirement to take on a full-time senior lawyer, and probably wouldn’t take on one as senior as the services that they buy. For those clients you add value, not just in your legal knowledge but in your business knowledge, and you become a sounding board for the management.

My first client was really interesting because it was a business of only about 70 employees. It’s a software business that licenses software systems from a big US company, but it is a very small company that doesn’t have HR, or risk and compliance and certainly not legal. I was their go-to person for anything that wasn’t business or sales and that the CEO needed a sounding board on. They now take my services on a retainer basis. I have a set number of hours each month and I work remotely or on-site, depending on what is required. A lot of the work is routed through the CEO but he encourages the whole business to speak to me directly and figure out if they have the documents and processes they need.

Thinking holistically about risk

It actually allows me to use my skills in a much broader way than traditional in-house legal work. For example the small software business recently had an employment issue, and after that I circled back to the CEO and asked him about policies on flexible hours, working from home and people having parental or caring responsibilities. That led me to create an employee handbook for them, which was a way of managing all their issues in the round, rather than the traditional private practice approach of solving the specific problem. So I am their embedded in-house lawyer (with flexibility) and therefore am able to work more proactively for the company on managing risk.

Getting commercial

GC: What is the difference in mindset between a private practice lawyer in this role, compared to someone like yourself who has worked in a business?

RD: I do think it’s interesting the way that law services have been shaken up the last few years and I don’t think that the traditional private practice model can survive so well in the middle echelons. There are going to be the big Magic and Silver Circle firms who will always do what they have done because there will always be big transactions where lots of bodies are needed. There will always be smaller firms in the community that form core relationships with local businesses. But in the middle is where firms will need to get more commercial. Many of them are almost as expensive as the Magic Circle.

‘The biggest compliment I got was: “Are you sure you’re from a law firm? You’re working like one of our team.”’

I think that’s where the Halebury model is interesting for clients. And I think all of the alternative players – Lawyers On Demand (LOD), Obelisk Legal Support, Axiom – are starting to shake things up. Most clients don’t want legal advice packaged in a ten page memo anymore. They want the law to be easily digestible and commercial, and they want lawyers to be more confident in giving recommendations.

It’s not my place to make the business decisions for my clients, but I can certainly give strong recommendations and advice based on my prior experience working in a business.

Flexibility

GC: Is there a typical working week for you?

RD: No, there’s no typical week! It’s very different from working in-house in a traditional sense, and that took me a bit of time to get my head around. The flexibility could be overwhelming – you have to be fairly self-starting. But I think for most lawyers that’s not usually a problem. Because I am self-employed and contract into Halebury, I can decide when to work or when to take three weeks off. That can be daunting if you’re used to working a nine to five. Also where is the next piece of work going to come from? For me that was an advantage of working as an interim rather than on my own as a consultant. I regularly talk with the management to ensure I have a good workflow.

I’ve had placements where it’s been full-time in a big legal department working alongside the team on major transactions, for normal office hours. I also did a project for a ‘big four’ accountancy firm which was much more project management, where I worked with the procurement team to draw all of their internal approval processes together. But I’ll have months where I’ll just work for my clients who have me on retainer and that might be between 40 and 120 hours a month. Yesterday I worked pretty much all day at home; today I’m in London in meetings; tomorrow I might take the day off. As long as I’m managing my clients’ expectations, it’s fine. But that might be too flexible for some people.

GC: If you decided to take six weeks off, what would happen to your regular clients on retainer?

RD: We’d bring in other Halebury lawyers who would pick up the work. Often other members of the team will have had prior experience with the client. But we usually work very closely with the client to determine the best cover.

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‘In the middle is where firms will need to get more commercial.’

Understanding the mindset

GC: What’s the rationale for big clients like BT using an interim when they already have huge in-house teams?

RD: Well it’s often cost – we’d be miles cheaper than a law firm. We might not be cheaper than a law firm doing a very good secondment rate, but you can often only have a secondee for a set period of time. You can’t have them for six weeks, send them away and then have them back in four weeks again.

We all have in-house experience so it’s not like taking a private practice secondee and training them in an in-house way. I remember from my time as a GC, when you first got a secondee (who only had private practice experience) they were often far less experienced and you had to train them in the in-house mindset: having an opinion and giving advice in a very straightforward way. Someone like me has the relevant experience, is very senior, can hit the ground running and because I’ve got that experience, I can act like a senior member of the client’s in-house team. Often that’s questioning the parameters and asking questions like: why are you running the project like this, and what’s the goal? Rather than just stating ‘this is the law’. I think we’re also a known quantity, as the client will have a relationship with the provider, so it’s not just like hiring a consultant from a recruiter.

Big clients often like us to come in and run a specific project so they can focus on all the other stuff they need to do. Even though some of these companies have big legal teams, they might not be that big in terms of each section of the team, and therefore they might get over-stretched in certain places at certain times.

GC: Do you ever face challenges from within clients’ in-house teams, or when dealing with clients’ outside counsel?

RD: Not so much from outside counsel, as you’re positioned as one of the in-house team from their perspective. I was working for one large client on their major transactions team. We were working on a big bid with a spreadsheet of all the points we had to address. We got the list down from 40 points to seven, and I think the biggest compliment I got was when the commercial person said: ‘Are you sure you’re from a law firm? You’re working like one of our team.’

GC: That’s interesting - do you consider yourself private practice?

RD: I don’t, but I think the clients do as they’re buying our service in.

Controlling the cost

Part of our model is providing clients with a tailored pricing plan which reflects their requirements and budget. For ad hoc work a capped hourly or daily rate may apply; fixed fees may be set for specific projects and longer-term placements; and retainer arrangements made for clients who want to ‘buy’ bulk hours, guaranteeing access to a lawyer while giving them budgetary control. The interesting thing for me is that I can set my own billing rate and I can offer client discounts.

Everything is very transparent. I feel very much in charge of my own time and my work. For the clients, I think that truly project-based approach alternatives can offer is very affordable, and helps them budget more easily.

Opening up options

GC: What do you think you’ve learnt so far from your experience of working in this way instead of the traditional model of working in-house?

RD: I love the flexibility. It’s definitely given me a perspective on my career, and it’s shown me that there are other ways of doing it.

I think it’s probably made me more tolerant in understanding why people need to go part-time or work more flexibly. Until I left Airwave I had worked full-time, even with young children.

Will I go back to a full-time role? Never say never, but it would have to be a job that interests me a lot, and where I feel I can make a difference to the business. There’s been so much that’s positive for me in the true flexibility and managing my own workload, it would have to be a rewarding role for me to give that up.

On the downside, I think it can depend on how you’ve chosen to manage your life. If you’re in a big GC or head of legal role and the status is very important to you then this way of working might not suit you as a permanent change, because you can’t have an ego about being a small cog in a big wheel.

I think an interim role is a really interesting niche as an alternative career path for senior lawyers who are looking for engaging high level work with greater control and flexibility. It’s appealing for people who are in transitions in their lives - maybe they have caring responsibilities for parents or young children, or have another passion they’re pursuing. That last one is quite interesting as there are a couple of people I know who only work part-time as interim GCs but they are starting their own businesses, or have taken up non-exec positions. This gives them the flexibility to use their legal knowledge and work on interesting projects, but also do something else important in their lives. It’s increasingly rare to get that in-house or in private practice.

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