Our Issues: Equality | Pro Bono | Size Matters | Join Us
The elite sector of the legal profession has done a poor job of integrating white female and minority lawyers of both genders into partnership positions. The legal services industry has lagged other business sectors in retaining and promoting these groups, leading to sharp criticism from leaders in the profession and from corporate clients.
Recently, then-ABA President William Neukom criticized the profession’s lackluster efforts at integration, saying that the legal profession was "lagging seriously" when compared with other professions and sectors of the economy. Meanwhile clients have begun to set diversity criteria for the firms they employ, and have signed on to the Call to Action in which hundreds of corporate general counsels pledged to make serious and sustained gains in law firm diversity an important criteria in their selection of outside counsel.
Building a Better Legal Profession adds the voice of law students to these growing demands for change within the profession. Elite law students want to work in effective, dynamic, and progressive environments. They understand the business value of diverse workgroups in our increasingly globalized economy and have no desire to work for firms that are losing revenue due to their failure to adapt. Moreover, law students are concerned with the fundamental moral issue posed by firms with all-white management. In 2009, it is simply too late in the day for a business organization to maintain an all-male or all-white management structure and be able to recruit the best talent to its team.
At BBLP we are dedicated to ensuring that students have full, free, and accurate information about law firm hiring, promotion, and retention of female and minority lawyers that is presented in a highly user-friendly format. Our goal is that elite students will vote with their feet by choosing those firms that have the best bottom-line results to show for their diversity efforts, and that in so doing will put competitive pressure on those firms that are still, regrettably, lagging behind.
One of the many problems generated by the escalation of billable hours requirements on associates in large firms is the declining commitment to pro bono work. The American Bar Association recommends that all lawyers contribute at least 50 hours of pro bono service per year. There is a well-known gap between the legal needs of the poor and the available legal assistance provided by legal services organizations. Pro bono work provided by the private sector is critical to delivering legal services to those unable to pay for them, including to death row inmates, other criminal defendants, immigrants facing detention and deportation, tenants contesting evictions, and workers seeking to enforce overtime and minimum wage laws. Large law firms have the ability to devote substantial resources to filling these unmet needs. Yet a shockingly low proportion of lawyers at large firms meet even the minimal 50 hour recommendation.
The reason is obvious. When associates were required to perform an average of 1700 billable hours per year, it was relatively easy to perform 50 or even 100 hours of charity service. But when firms began to require 1900 or 2000 hours of billable service, associates – particularly those trying to balance those hours with a family – began to find it too taxing. The result is higher profits for partners at the expense of the social good .
The legal profession has been given the right to self-regulation and monopoly by the state in exchange for lawyers’ willingness to provide service to the community. The legal services industry has broken this trust by prioritizing excessive profits for partners above public service.
Size Really Does Matter
Twenty five years ago, the largest law firms in the country had an average of 95 lawyers. Today, that average is more than 500, with the 20 largest firms in the country having well over 1000 lawyers. Along with this exponential growth in size has been a huge increase in profitability. Where 20 years ago, partners at top firms earned between $300,000 and $400,000, today that figure tops $1 million for most of the country’s largest firms, and is approaching $5 million per partner at the most profitable. According to one analyst, if the growth trends of the last 20 years are projected forward into the future, the 46 largest firms will have gross revenues of more than $1 billion each, with the top six bringing in more than $10 billion each. Many of these firms are projected to employ more than 10,000 lawyers, most of whom will be based outside the United States.
The increased size and scale of the modern firm is a product of its business model. The economic structure of the large firm is such that profit per partner (what the partners take home) is determined in large measure by three things: billing rates, the number of hours that associates bill, and the ratio of equity partners to other lawyers at a firm. A certain number of associates must be promoted to partner each year in order to maintain the incentive structure that motivates associates to work so hard. (Those not promoted must leave, building in a high level of necessary attrition.) But each time a firm adds an equity partner, it must do something to ensure that the profit per equity partner does not fall as a result of adding new partners. It can raise rates, add a sufficient number of new associates, or increase the number of hours worked by current associates. Often it does all three, making firms progressively larger, more expensive, and more hardworking.
This explosion in law firm size has brought many negative consequences. One of these is the inexorably rising billable hour requirement. The negative effect of rising hourly requirements on pro bono is discussed above. A second deleterious effect is on the promotion and retention of female lawyers. A glance at the attrition figures for women in large firms makes it clear that these hours are often incompatible with pregnancy and taking care of children. Though the hours requirements have a severe disparate impact on the success of women in the legal services industry, they also impact the ability of male lawyers to be involved in the lives of their children. The lack of work-life balance is a frequent complaint of law firm associates, both male and female.
As firm size has ballooned, the work given associates has diminished in quality. Tasks such as document review which are allocated to young lawyers have been progressively de-skilled and routinized until they are stripped of much of their intellectual content. Many firms have established a second-class career track for “staff attorneys” or contract lawyers who are paid half of what associates make, are often minorities, and who have no chance at advancement. Meanwhile, hundreds of associates are vying for the few opportunities to try cases.
Of course, it is easier to make unreasonable demands on the young lawyers at your firm if you are making them from another city or another country. Growth in size has also led many firms to move away from a professional partnership model in which all decisions are made jointly toward a more business-oriented approach with centralized management making most decisions. As the social and geographic distance between associates and management has grown, it has been increasingly easy for firm management to impose hours policies that increase profits at the expense of associate job satisfaction or family life. The exodus of female lawyers with children is not seen by firm management as a result of the unreasonable billable hours demand but as merely part of the high level of attrition required to keep the firm profitable.
BBLP sees it differently. First, there is no excuse for maintaining policies that have the effect of driving nearly all the women out of the workplace within 10 years of graduation from law school. Yet that is what the business model of the large law firm, with its focus on billable hours, has done. Women make up 50% of the entering associates but only 13% of the equity partners in the country’s largest firms including those we rank. If the business model of the large law firm is incompatible with the success of women then it must change. But just as importantly, both male and female associates are suffering from these short-sighted management efforts to increase profitability. Law firm lawyers have the highest rates of depression and alcoholism and the lowest rates of job satisfaction of any profession. BBLP works to put pressure on the legal services industry to reform the business practices that are leading to these undesirable results.
Join Us to Work for Reform
BBLP chapters at top-tier law schools around the country are involved in activities and actions intended to raise awareness among students and also to press firms for reform on these important issues. Contact your local chapter or start one at your school.