SHAUN, THE POOR CONTRACT ATTORNEY?!

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.

8 thoughts on “SHAUN, THE POOR CONTRACT ATTORNEY?!

  1. Well that is just great isn’t it. The secretaries here at my firm are a nice bunch but seem never to have any work to do. All they do is read magazines, drink team and banter and surf Facebook. Maybe I should apply for those roles. At least Internet instead of a secure data room.

    Report this comment

  2. Your Comment #4 is spot on (as the brits say).

    My 11 year old son asks me, why is such and such product so expensive? I say, “because they can sell it for that price.”

    The same is true for contract attorneys, if the firms can find a sucker for such a law wage, they will continue to push the wages down.

    Report this comment

  3. Interesing. I guess lower rates for contracted work seems to more prevalent that it used to be. How sad that we have come to undervalue so greatly someone’s expertise. Just my thoughts for the moment. :)

    Report this comment

    • Thanks for your comment Susan. As always it’s appreciated.

      On this point we have just had a conversation with a freelance IT consultant who faces the same dilemma in his industry now. Agencies testing the waters and other contractors underselling themselves. That second point is the one to tackle eventually…

      Report this comment

  4. Considering the massive markup the firms and/or agencies make on our work as contract attorneys, I think we are far underpaid. My current firm charges 220$ for me but I only see 35$.

    Not only that – in England there’s a new Government sponsored scheme being rolled out to get people from less privileged backgrounds into the legal industry. Even without a law degree or any proper professional education. And this also for around 2.60£ which is about 4 bucks hourly rate to be paid to this so called paralegal trainees.

    http://www.rollonfriday.com/TheNews/EuropeNews/tabid/58/Id/2098/fromTab/36/Default.aspx

    Surely this will also lead to salaries for contract attorneys and document reviewers fall further. Why would a firm even pay 12£ if they can have it for less than a cup of coffee at the aforementioned Starbucks. Well they will not get quality from this kind of people. That’s certain.

    Report this comment

    • Thank you stopping by and for your comment Simone. Wow, that’s definitely a massive markup your firm is making. How do you know your charge-out rate. Normally firms are über protective regarding those information. At least now we know why…

      Interesting link you sent us. We stumbled across it last week too and already tweeted it our followers.

      We would however slightly disagree with your assessment of the quality of people coming through tis scheme. We don’t necessarily think they will be poorly trained people. Sometimes (esp in the UK), those who come from a ‘less privileged’ background are harder and better workers. One’s prospects in life are all about the opportunities that are afforded to the same, rather than necessarily schooling. If these guys were given the opportunity to get a foot into the door of a legal career, it can also be positive we think.

      Query, though, whether anyone that they have identified that they are targeting to benefit from this can actually afford to work for £2.60 per hour???!! We know we certainly couldn’t. Nice idea but we can’t see the people they are aiming at could actually ever use the scheme – certainly for no longer than a few weeks? 

      Report this comment

  5. I knew the handwriting was on the wall at the company I did contract/doc review work for when they opened up an office in India. Haven’t had any work from them in almost a year. They only paid $20 p/H.

    Report this comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>