Recently (on a Friday) the UK-based brains behind Contract Attorney Central received the following email:
I write to ascertain whether you free for this short term role; Start: Monday 18th June
Rate: £12ph, Firm: [a top 20 law firm based in Central London], Interview: Today
Please only reply if you are interested, can start on Monday and interview this afternoon. I look forward to hearing from you, [A large London based recruitment company]
Hold on a minute – £12 ($18) per hour for a document review role? There must be a mistake, the naive might say. Well, a job offer is a job offer may respond the realistic.
Considering a regular 40h/week this job would earn a contract attorney approximately £23,000 ($36,000) per annum, let’s get creative for a minute and compare a hypothetical annual salary of a contract attorney (let’s call him Shaun) who would accept this role with a few average salaries published on www.glassdoor.com:
Postman, Royal Mail, London, UK £21,500 / $33,500
Shaun, Contract Attorney in London, UK £23,000 / $36,000
Starbucks Store Manager in London, UK £29,500 / $46,000
Legal Secretary, Top 20 Law Firm, London, UK £34,000 / $53,000
3rd Associate, Top 20 Law Firm London, UK £78,000 / $121,500
Iit is interesting to see that Shaun would earn slightly more than a postman but less than a Starbucks store manager and even significantly less than the (again hypothetical) legal secretary sitting down the hallway from him. Not to mention the ‘real’ lawyer – the associate in charge of the document review.
OK now having established the status-quo, let’s dig down into the reasons for the recent popping up of low rate document review job offers and consider the options available to contract attorneys in such a market.
Reasons For Increase of Lower Paid Contract Attorney And Document Review Jobs:
1. Agencies Testing The Water
A very simple reason for the decrease in contract attorney salaries is that the agencies do simply try to test the waters. In times of higher supply of contract attorneys, it is a natural (business) decision to test ‘how low can we pay?’ (also to be read as ‘how can we maximize our commissions on the back of the contract attorneys?’)
2. Competition And Passing Down The Tighter Margins
It appears that the competition between recruitment agencies has intensified significantly recently. Some of us at Contract Attorney Central have experienced this in the form of unauthorized submission of our CVs, which is naturally followed by fighting between agents over who is entitled to the placement commission). For example, recruitment agencies try to get business from the law firms by bidding 10-20% less than the competition. Subsequently they pay the contract attorneys 30% or so less and thus keep the difference in form of their commission.
3. Outsourcing To Cheaper Domestic Areas or Low Labor Cost Countries
The reality is that document review is no longer the cash cow for the large international law firms based in New York, DC or London to the same extent as it has been in the past 6-7 years. The ability of major law firms to outsource reviews to cheaper domestic areas than the major cities where their headquarter normally sit, is allowing them to justify paying lower rates. However since nobody can live on this sort of pay in places like New York or London, document review in major cities might become rarer, as the review projects will be consolidated in less busy and less costly cities and areas. But not only this ‘domestic outsourcing’ but also outsourcing of document review projects to emerging countries such as India and the Philippines does have cost benefits for the firms and will eventually put them ahead of more expensive competitors when it comes to bidding for e-discovery projects. Contract Attorney Central has extensively covered this covered the topic of outsourcing and over-saturated contract attorney markets here.
4. Roles Still Being Filled
A very simple reason behind the increase of lower paid contract attorney and document review roles is simply that those roles do get filled easily. Hence, the testing of the water as described above is usually successful, specially in major cities where there is a high supply of contract attorneys. Unless certain skills are required, agencies tend to easily staff projects – even on low rates. Here at Contract Attorney Central we have worked on a document review where certain language speaking attorneys have been let go after a few days on the project, just to be contacted very shortly afterward by the same agency to re-join the project but with a 50% pay-cut! Even though those contract attorneys were now paid less than non foreign-language reviewers, they nearly all re-joined.
How Should Contract Attorneys Respond To Lower Paid Contract Attorney And Document Review Jobs?
First and foremost we think – unless you really have to for financial reasons – you should not accept those positions which clearly underpay any reasonable market rate in your particular market. The document review and contract attorney arena is a two or threefold business with attorneys, staffing and recruitment agencies and usually law firms involved. It is easy for the stronger parties in this equation to take advantage of the weaker one, ie. the contract attorney. As long as the low paid roles get easily filled, the agencies and firms will keep lowering the rate for their own financial benefit.
In addition to the market mechanics it is also a question of integrity of the contract attorneys who are ultimately professionals with university/college degrees who should not sell themselves under value for the services they provide.
Be upfront to your agent and demand a reasonable salary. One colleague of ours usually responds to job offers such as the above and asks only to be contacted for roles above £25 ($40). Surprisingly, he has not been blacklisted yet but instead managed to negotiate (at least for himself) a reasonable market-rate for such a low paid gig. Not a bad result for standing up for yourself.
Contract Attorneys and Document Reviewers – have you experienced or been offered this kind of lower paid document review jobs? What is your take on this issue? Would you agree with our assessment and tips or do you have alternative ideas and suggestions how to ‘fight the evil’? We would love to hear from you, so please leave a comment below.