Emerging legal talent may be increasingly looking to alternative legal services providers (ALSPs) as employers to take advantage of the flexibility and innovative work they offer
One somewhat unheralded finding in the Thomson Reuters Institute’s recently published Alternative Legal Services Providers 2023 Report was that alternative legal services providers (ALSPs) have become very attractive as employers as they leverage new ways of working that are enticing new hires and benefitting these ALSPs themselves.
The data-driven report on the ALSP market — published every two years by the Thomson Reuters Institute in partnership with The Center on Ethics and the Legal Profession at Georgetown Law and the Saïd Business School at the University of Oxford — tries to bring quantitative precision to the growth, potential, and challenges of this innovative market. As part of that research, Thomson Reuters conducts interviews with dozens of leaders at different ALSPs, getting a first-hand view into how these organizations are adapting to and driving changes in the legal landscape.
Leaders of ALSPs say their companies are growing strongly — the report found that in the past two years, the field has grown 45%. And that leaves many ALSPs looking to hire. “Today, the talent that is coming to us is extraordinary,” says the founder of one U.S.-based independent ALSP. Some of these legal professionals might otherwise be facing layoffs, but in the wake of the pandemic, others are looking for a different career and style of working than law firms have traditionally offered. Law firm leaders are suddenly finding that they need to sell the partner track to associates, rather than simply assuming that every young lawyer prioritizes a partner slot above all else.
This attitudinal shift in the talent mindset could have impacts across the legal industry, and the full implications of such a transition may not be known for years. But ALSP leaders say the experience and credentials of people looking for a substantial career change is impressive, and it is changing the perception of ALSPs.
Changing legal work landscape
The exact nature of law firm layoffs may work to the advantage of some ALSPs. “Law firms started letting go, not their rain makers, but their service partners, who were their subject matter experts,” says that same ALSP founder about the last rounds of law firm layoffs.
For many of those people, says a U.K. partner who runs their law firm’s internal ALSP, an ALSP may be a better fit for an individual’s strengths and career aspirations. For some of those considering leaving the traditional law firm career path, working at an ALSP may mean “doing what they enjoy, which is doing law,” the U.K. partner notes, adding that not every lawyer relishes business development or is a good manager, and for those, an ALSP might be a better fit.
These subject matter experts could also enable ALSPs to move into new service areas, such as into advisory work. “With more and more AmLaw staff on our bench, we’ve been angling to go more upstream and provide services that law firms provide in terms of expertise and counsel,” says the chief product officer of a U.S.-based independent ALSP. This leader also says they see potential in service categories related to labor & employment, regulatory matters, and privacy. “We’re gaining traction.”
Depending on who, exactly, chooses a career outside of traditional law firms, a movement to ALSPs could also have an impact on firms’ efforts to meet their goals in diversity, equity, and inclusion. It’s not a stretch to think that those who are most interested in an alternative way of working would include an over-representation of those who have traditionally had the hardest time navigating the more stringent law firm career path.
ALSPs say they are already seeing a change in the mindset of their clients, who now have a better understanding of the potential and allure of remote work. They’re also understanding that it doesn’t make sense for a lawyer, necessarily, to be acting as a project manager on a large matter. Further, ALSPs have identified the value of putting non-lawyers into leadership positions — a strategy which is often untenable for law firms — empowering ALSPs to leverage business and operational expertise in both the day-to-day running and strategic direction of the business.
Says one partner at a U.K.-based law firm ALSP:
It always used to be, ‘I need a lawyer who’s an expert in data privacy five days a week to sit next to me in Doncaster’ or some other remote place. Now it’s very much more. ‘I need these skills, for this amount of hours. I don’t know or care where they are, if they can work remotely, as long as I meet them.’ And I think that has opened up the market significantly.
Over the past few years, those clients have gained a better understanding of why lawyers might choose to work differently, and in fact, have gained more experience with remote work themselves. Clients also have seen colleagues make career choices that would have seemed surprising just a few years ago.
“We would hear from our clients all the time, ‘If they’re really that good, why aren’t they at a big law firm or why aren’t they in-house?’” says the general manager of one U.S.-based independent ALSP. Now, he says, clients see that ALSPs can allow them to work with the same attorneys they would have hired from an AmLaw 50 firm. “They were at an AmLaw 50 firm 10 years ago, and they didn’t leave because they weren’t as good,” says the general manager. “They left because they wanted something different.”
More and more, that “something different” is often a way of working that ALSPs are only too happy to provide.
You can download a copy of the Thomson Reuters Institute’s Alternative Legal Services Providers 2023 Report here.