Junior Lawyer Squeeze: BT Outsourcing In-house Work
The telecoms giant has followed the likes of Rio Tinto and Microsoft…
…directly outsourcing legal work to low cost providers.
In January we predicted that legal process outsourcing would be big in 2010 as it became clear that business themselves were taking a lead in the use of LPOs.
Legally India: BT announced yesterday that by “moving the existing in house team offering legal support services to UnitedLex, the BT Legal team will be free to focus on more complex and value-added activity”.
LPOs represent an increasing threat to the junior end of the legal profession in the UK. Whether it’s trainees or NQs, the simple fact is that LPOs can do the grunt work at a much lower cost. And clients know it.
Added to which, there is something of a one-way street as far as access to India is concerned. As low value work flows out there, high value work is not flowing back in at the same rate. International firms such as Allen & Overy, Clifford Chance (CC), Shearman & Sterling and White & Case have been banned from practicing in the Indian market.
The ban on international firms having offices in India was reinforced by the Bombay High Court in December. And more recently, a group of Indian lawyers have sought government action against 31 foreign law firms, including those listed above, and a legal process outsourcing (LPO) company for illegally practising law “out of five-star hotels and business centres” reports The Am Law Daily.
The fact that an LPO has been included in the latest action is surprising; UnitedLex CEO Dan Reed told Legally India that unlike law firms, UnitedLex lawyers did not opine on law and did not practise law, adding, “We don’t compete with Indian law firms and we sure as hell don’t practice Indian law.”
This blip aside, growth of LPOs in India and other low cost jurisdictions is expected to continue. As is the exponential rise of paralegals in the UK. So an ill wind blows for the record numbers of students signing up for law courses.
Our latest prediction – there will be a strong supply of paralegals.
March 31, 2010
This is also a common trend in Australia and the UK. Big law firms have begun outsourcing paralegal work to india to access the cheaper labout in those locations. We are also seeing the same strains on the junior members of the legal profession as their jobs are outsourced overseas.
March 31, 2010
To think I was going to head down under to escape the misery Brown and co have inflicted upon us here. How depressing.
March 31, 2010
There will still be plenty of training contracts for those bright enough to get them. Law firms cannot outsource everything otherwise they will be eating into their own profit base. At the top end, multinationals will always require top quality advice from the best firms in which case they will normally look to big UK or US firms.
January 17, 2011
I think almost all the jobs can now be outsourced. Many companies are doing this because they can reduce their expenses. It is beneficial to the countries that do the outsourcing because it brings employment despite the low labor costs.