Several years ago I marked both the 50th anniversary of my admission to the bar and my 50th year as a member of my law firm. Those milestones inspired me to reflect on the changes that have occurred in the legal profession during the past half century. There have been profound changes—some obvious, others subtle—that have radically transformed the manner in which law is practiced and experienced by lawyers. The social and economic structure and the culture of the profession are very different from what they were 50 years ago.
L.P. Hartley, the English author, once wrote, “The past is a foreign country; they do things differently there.” A young lawyer of today in a large firm, if transported in a time machine back to the 1950s, would not find a law firm of that era an alien place, but he or she would quickly perceive that they did “things differently there.” Our present-day young attorney, viewing a practice in 1950, would be struck, among other things, by the much smaller size of law firms, the almost complete absence of women and minority lawyers, and the lack of computers and other sophisticated communication devices.
My purpose in this essay is not to indulge in reminiscences or to glorify the past as a “golden age” for I do not think that it was—certainly not for women or minorities—but because I believe such a comparison illuminates important issues affecting lawyers and the quality of the professional life they experience.
I concentrate on three matters: (1) the tremendous growth in the size of law firms, including the emergence of megafirms, the globalization of practice, the greatly enhanced competition in the profession for legal business, and the specialization that now characterizes legal practice; (2) the changing demographics of the profession, specifically the increased participation of women and minorities; and (3) the impact of new technology.
It is no longer accurate to speak of the legal profession; the law is practiced in many different ways in a large variety of institutions. Although my discussion focuses on large firms, i.e., those with several hundred lawyers or more, changes that I describe affect law firms of every size. The demographic changes, the intensified competition for legal work, the pressure to increase profitability, issues relating to specialization, and technology have an impact on all lawyers. Some developments in the past 50 years are outside the scope of this essay, for example, the expansion of in-house corporate legal departments, the introduction of legal departments in accounting firms, the extensive use of paralegals, and the emergence and impact of the trade press.
Several points merit emphasis: First, I regard some of the changes in the profession in the past half century as salutary, for example, the lowering of entry barriers to women and minorities, but I have reservations about various aspects of large firm practice. Second, I believe there are opportunities to do challenging and professionally satisfying work in all types of institutions. Finally, there are numerous career paths open to young lawyers apart from working in large firms. However, a considerable number of young lawyers will spend some time in a large law firm, especially at the outset of their careers.
Growth in the Profession
One of the most striking changes in the past half century is the enormous increase in the total number of lawyers, together with the major expansion in the size of many law firms, the emergence of megafirms, the branch office phenomenon, and the globalization of the profession. This expansion in the lawyer population has been accompanied by greatly intensified competition among law firms for legal business.
In 1951 there were approximately 220,000 lawyers in the United States; by 2000, the lawyer population exceeded one million. The American Bar Foundation’s Lawyer Statistical Report shows the following:
U.S. Lawyer Population Size (selected years)
In the late 1950s fewer than 40 law firms in the United States had 50 or more lawyers; in 1960 there were only about a dozen firms with 100 or more lawyers. When I was at Yale Law School in 1950, students spoke of avoiding employment in the “legal factories” in New York; they were referring to firms of about 75 to 100 lawyers. In March 1953, when I joined Arnold, Fortas & Porter LLP as an associate, the firm had 11 lawyers. The two largest firms in Washington were Covington & Burling LLP, with about 70 lawyers, and Hogan & Hartson LLP, with about 25 lawyers.
All of this has greatly changed. Today, more than 600 lawyers work at Arnold & Porter, Covington & Burling has more than 500 lawyers, and Hogan & Hartson is a firm of nearly 1,200 lawyers. As shown by a 2006 American Lawyer survey, there are at least 13 firms in the United States with 1,000 or more lawyers.
What accounts for this explosive growth in the profession? In a perceptive essay written a decade ago, “The Material Basis of Jurisprudence,” Judge Richard Posner advanced an explanation that I find convincing. Posner argued the legal profession in the 1950s was essentially a cartel, in his words, “an intricately and ingeniously reticulated though imperfect cartel.” There was no overt collusion between law firms with respect to such matters as fees charged of clients or salaries paid to associates, but the profession was anticompetitive in a great many ways. It was like a club with highly restrictive membership practices. Posner analogized the profession at that time to a fictitious linen weavers guild in 12th-century France that was granted a monopoly charter over the manufacture and sale of linen fabrics. The practices of the guild were anticompetitive—it enforced limits on hours of working and on the number of employees, and it fixed minimum standards of quality. The guild encouraged and prized excellent craftsmanship. There were high barriers to entry; strict rules were established on who could become an apprentice, and the guild, according to Posner, “excluded from membership Jews and other aliens believed not to share a common core of basic tastes and values with the members.”
Like the guild, entry into the legal profession is restricted; it is limited to individuals who have college and law degrees, who receive a passing grade in a bar examination, and who satisfy a bar committee that they are of sound moral character. A half century ago, barriers to entry into the profession were substantially reinforced by law firms through gender, racial, religious, and ethnic discrimination. The cartel was protected by the government—by statutes and court rules. There were strict statutory prohibitions against the unauthorized practice of law by nonlawyers. Competition within the profession was limited in a variety of ways, for example, by bar association and court rules prohibiting solicitation and advertising, encouraging lawyers to price their services according to fee schedules set by bar associations, and by bar admission rules that restricted the movement of lawyers from state to state. There was ample legal business for lawyers who were then engaged in practice, and there was almost no pressure to reduce fees to clients. There was little, if any, price competition. The current practice by potential clients of interviewing a number of law firms before retaining one firm to handle a major matter was then unknown. Many corporations retained one law firm for nearly all of their legal work; they did not seek out lawyers in Firm A for corporate transactions, lawyers in Firm B for an antitrust suit, or lawyers in Firm C for product-liability litigation. Many of the ties between law firms and corporate clients arose out of social and personal friendships between a corporate chief executive and a senior partner in a law firm.
As Judge Posner pointed out, the situation began to change around 1960. The cartel was shattered, and the profession became intensely competitive. Today, there is significant competition in nearly all areas of practice: for legal business, in fees that are charged, for attractive lateral entrants, and in the hiring of associates. Posner points out that the disappearance of the cartel in the legal profession was “a consequence of a surge in demand for legal services.” As he notes, the causes for this surge are not altogether clear. Posner states it was associated, among other factors, with “the creation of new rights, much higher crime rates, greatly relaxed rules of standing [to sue], more generous legal remedies (including relaxed standards for class actions) as part of a general tilt in favor of civil plaintiffs and against civil defendants, and the increased subsidization of lawyers for indigent criminal defendants and indigent civil plaintiffs.” There was an explosion in the volume of litigation. The “big case” became a common occurrence. To the developments mentioned by Posner, I would add that the increase in government regulation was a key factor. In addition, new areas of practice emerged.
When I was a student in law school, there were no courses in environmental law, but by the late 1970s, it had become a flourishing area of practice. Similarly, health care, housing, and energy law were not a part of the curriculum in the late 1940s, but now many lawyers are occupied in representing clients in those areas. The law relating to patents, trademarks, and copyrights was viewed as a relatively unimportant subject; presently, intellectual property matters are a significant area of practice in many firms. Pension and employee benefit law, now a major field of regulatory law, effectively did not exist until Congress enacted the Employee Retirement Income Security Act of 1974 (ERISA). All of these developments generated a demand for more lawyers, and law firms expanded in response to the demands of their clients.
From Partnership to Corporate
The enormous growth in the size of firms and the increase in competition have led to a fundamental change in the legal profession that I characterize as a shift from a partnership mode (or culture) to a corporate mode (or culture). By partnership mode, I mean an institution in which interpersonal relations are influenced by friendship, collegiality, and loyalty to one’s partners and the firm; by a corporate mode, I mean an institution in which interpersonal relations are dominated by considerations of profitability. In saying this, I do not mean that law firms have become corporations, although many are professional corporations or limited liability partnerships, nor do I mean to suggest business considerations are not an important factor in a partnership. My point is, there has been a major change among law firms in the personal relations among partners and between partners and associates. The relations that prevail are characteristic of large business organizations.
Many lawyers who were practicing in the 1950s and 1960s speak with nostalgia of collegiality and camaraderie among the firm’s members at that time. The partners in a firm knew one another and socialized together. In many firms, compensation was a lock-step system based primarily on seniority and not on the volume of legal business generated by the individual partner. It was virtually unthinkable to suggest a partner should be forced to retire prematurely, or that his compensation be substantially reduced because he no longer was as productive as he had been earlier in his career. The process euphemistically described as “de-equitization,” that is, reducing the compensation of an equity share partner by shifting him from having a right to a percentage of the firm’s profits to a fixed salary, rarely occurred 50 years ago. There was very little mobility; partners rarely switched from one firm to another. Mergers among law firms were almost unknown.
All of this has changed. Large size makes collegiality extremely difficult. How can one possibly know 400 or 500 colleagues scattered in different cities throughout the world? Decisions such as those relating to compensation, that were once influenced in significant part by tradition, loyalty, and regard for past contributions to the firm, are determined by bottom-line, objective factors. The lock-step system of compensation has been replaced by an “eat-what-you-kill” system geared toward business generation. The relations among partners, and between partners and associates, are shaped to a great extent by considerations of profitability.
An institution consisting of a thousand or so lawyers and a support staff of hundreds must be carefully managed. Failure to do so can be disastrous. There are lawyers who devote all, or a goodly part, of their working day to firm administration. Moreover, every large firm requires rules and procedures. In short, the large law firm has become bureaucratized.
Until recently, election to partnership meant three things: tenure, a right to a share of the firm’s profits, and participation in the firm’s decision-making process. Now, the situation is radically different. In many firms, partners can be demoted, deprived of their equity share, or forced to leave the firm. As law firms have grown larger, and as they have diversified geographically with numerous branch offices, partners in the firm have come to have a lesser voice in firm policies, and they have tended to become more like corporate employees. A small number of the major “rainmakers” of a law firm—those partners who generate large volumes of business or who are responsible for the supervision of the work of the firm’s largest clients— have a significant voice in determining the direction that the firm will take. These rainmakers can decide whether to open a new branch office, hire a particular lateral candidate, acquire or merge with another law firm, and so on. But the great majority of partners largely are uninformed about firm matters, and they do not participate, except in a pro forma way, in shaping firm policies.
These changes have important implications with respect to our notions of professionalism. Heretofore, a professional has been defined as an individual who exercises a large measure of control over the manner in which he or she renders services. In a large firm, partners still function without substantial oversight or interference in advising clients, writing briefs, trying cases, and handling transactions. They still enjoy a high degree of autonomy in these areas. But many of the day-to-day aspects of their work are subject to firm rules and procedures. The records they must maintain, their billing practices, the financial results they must produce, and the hours they are expected to work are all guided by firm policies.
In addition to changes in interpersonal relationships within the firm, there have been significant changes in client relations of large firms. Many clients in the 1950s and 1960s viewed their lawyers as trusted advisors and counselors. Questions concerning fees rarely were raised by corporate clients. Today, lawyers frequently are viewed as technicians, such as auditors or an engineering consultant. Clients insist on detailed information in statements for fees about work that has been performed, and firms are pressured to lower fees and grant discounts. Many lawyers who practiced 30 or 40 years ago have remarked to me about the absence of client loyalty, which means excellent performance on a particular matter does not guarantee being retained in future matters. I do not mean to suggest by the foregoing observations that there are not close ties in some instances between clients and lawyers; a difficult litigation or a complex transaction may lead to strong bonds. But it is fair to say that objective business considerations are the controlling factor in lawyer–client relations.
Judge Posner’s thesis—that competition replaced an oligopoly—accounts for a number of the present characteristics of the legal profession, such as the maneuvering among firms with respect to billing rates and fees they will charge, the relative equality in compensation paid to associates, the lateral movement of partners from one firm to another, mergers between firms, and the aggressive pursuit of legal business. But Posner’s insight does not explain why firms have gotten so large. The expansion of government regulation and globalization of business operations has had an impact. The large law firms have developed in response to the demands of the marketplace. They thrive because they satisfy the requirements of their clients, principally the world’s large business organizations. Their strength lies in the broad range of their capabilities, in the depth of their expertise, and in their ability to mobilize large teams of lawyers who can address complex legal issues. They are attractive to young lawyers heavily burdened by debt incurred for their education because they offer substantial financial rewards, and they are counsel in many of the cutting-edge transactions and cases.
It is not clear whether there is a maximum optimum size for a law firm or whether at some point growth in size will result in inefficiencies and counterproductivity. One limit to growth is conflicts of interest, both of the type prohibited by the Rules of Professional Conduct (for example, a firm may not sue an existing client) as well as so-called business conflicts, that is the unwillingness of an important client to allow the firm to represent a competitor, supplier, or customer even though there is no conflict forbidden by the rules. Firms that represent large international conglomerate organizations have frequent conflict issues that may limit expansion.
The extensive movement of partners from one firm to another is among the dramatic changes that have occurred in the profession since the 1950s. It was almost unthinkable in that era for a partner to contemplate joining a rival firm. Today, it is common. This phenomenon reflects, in part, a breakdown in the spirit of collegiality and loyalty to one’s partners that characterized law firms half a century ago. It also evidences the dominance among individual lawyers of financial considerations as well as the intensely competitive character of present-day practice that prompts a firm to pursue a partner from another firm to strengthen its competitive position and profitability. In addition to the disruption to the practice of the abandoned firm that may be caused by such departures, as well as the feelings of betrayal and bitterness that are generated, significant problems, including ethical concerns, often are presented to the firm that the lateral joins.
The successful integration of laterals is a major challenge. In the case of firm mergers, the integration problems are magnified enormously; many partners and associates may be forced out, and others will leave independently. Differences in billing rates and compensation practices between the two firms can create tension. Moreover, the introduction of a large number of lateral partners can affect the morale of associates who feel their advancement may be impeded. For such reasons, some firms still strictly limit the hiring of lateral partners and adhere to the policy of creating partners primarily from among associates who have absorbed the firm’s culture during an eight- or nine-year apprenticeship. It is true a firm can grow quickly by recruiting laterals. However, it should also be noted that, in a significant number of instances, laterals leave within a few years after their arrival. As reported recently in The Legal Times, “over the last five years, among the Am Law 200, 10 of the 25 firms with the most lateral hires are also among the 25 firms with the most partner departures.”
The practice of law has always had aspects of a business; it was, and is, a way of making a living. But in the 1950s, lawyers thought of themselves as “professionals,” not as businesspersons. Numerous commentators have remarked that in recent years legal practice has become commercialized. By that, they mean that financial considerations are of overriding importance, and the notion that lawyers have responsibilities to serve the interests of justice and the public interest, or that they are different from businesspersons, is no longer the case.
A megalaw firm is a large financial institution. The annual gross revenues of nearly a dozen firms exceed $1 billion, and for more than 40 other firms they exceed $500 million. The 2006 American Lawyer survey shows that profits per partner at seven New York firms range from $2.5 million to nearly $4 million. There is a lengthy list of additional firms in which the average annual compensation for partners exceeds $1.5 million.
It is impossible to understand the dynamics of large law firms without taking into account this financial picture. Revenues and profitability of this magnitude have many implications. A large law firm is a big business. There is enormous pressure on partners in such firms to generate legal practice sufficient to sustain such revenues. As Judge Richard Posner, observed: “The increasingly competitive character of the legal services market makes lawyers feel like hucksters rather than the proud professionals they once were, and brings forward to positions of leadership in the profession persons whose talents, for example, for marketing [rainmaking] are those of competitive business rather than of professionalism.” These figures also reflect the long work hours of partners and associates, and the decreased commitment to pro bono by various partners. The emphasis on generating business has greatly diminished the satisfaction that many lawyers once realized from practice.
Collegiality has been damaged by the replacement of partner compensation systems based on seniority with systems predicated on business generation. Since it is frequently not clear who in a large firm is responsible for originating a particular matter, disputes arise between different partners concerning the allocation of billing credit for purposes of determining compensation. Thus, instead of promoting cooperation and camaraderie, the compensation system may engender rivalry and rancor. Such systems are justified on the grounds that to be economically viable, a law firm needs a steady inflow of new matters, and there needs to be an incentive to produce such matters. It is argued that partners who succeed in doing so should be rewarded. Given the economics of the current law practice, that is a compelling argument.
There is another aspect of this emphasis on money that should be noted. In my generation the message to associates was simple: If you work hard and if your work product is excellent, the likelihood is that you will be made a partner. No one ever suggested to me when I was an associate that it was important for my advancement to generate practice for the firm. That, too, has changed. Unlike the situation 40 or 50 years ago, only a small percentage of associates will be elevated to partnership. At present, the prospective capacity of an associate to expand the firm’s practice, either with an existing client or by attracting new clients to the firm, is an important criterion for election to partnership. Entrepreneurial capability is held in high regard. It is unlikely that anyone will rise to the highest levels of partnership compensation who is not an important rainmaker. The law school can contribute to an associate’s ability to do excellent legal work, but I do not perceive how it can teach or cultivate entrepreneurial or rainmaking abilities. I know of no law school that holds out that it can do such a thing. Yet, that ability has become a crucial factor for a successful future in legal practice.
Some of the extraordinary growth in lawyer’s compensation can be dated to the early 1980s when large corporate takeover fights occupied center stage. Lawyers engaged in such battles noted that their counterparts in investment banking firms were realizing enormous incomes. They could perceive no legitimate basis for the income differential. There was mounting pressure to increase fees and escalate profitability.
To lawyers who began practice in the 1950s, the compensation now being enjoyed by associates at large firms is astonishing. Presently, law school graduates joining the large firms in New York and Washington generally are paid in their first year an annual salary in the neighborhood of $125,000 to $160,000, plus a year-end bonus, and the compensation of associates, when they often are eligible for election to partnership, can be in the range of $400,000. Hiring bonuses in the range of up to $250,000 are paid to former Supreme Court law clerks. These high stipends have been motivated in part by concerns that otherwise talented young lawyers will choose to join investment banking houses, hedge funds, accounting firms, and in-house corporate legal departments.
Salaries at this level are by no means an unmixed blessing for associates. Law firm managers understand the principle that profitability inheres in realizing revenues in excess of salaries paid to associates, and they also appreciate the point that profitability is maximized by leveraging the number of associates relative to the number of partners. Since there are limits to the fees that a client will tolerate, there is substantial pressure on associates to work a large number of hours, and the number of associates who will advance to equity partner positions is strictly limited.
One of the distinguishing characteristics of present-day practice is the high degree of specialization. In the 1950s, it was possible for young lawyers in Washington to aspire to be a generalist. There were ample opportunities to function in different areas of practice. I specialized in antitrust matters. I advised clients about such issues, I served as trial counsel in antitrust suits in the federal courts and in administrative proceedings, and I represented parties before the U.S. Department of Justice and the Federal Trade Commission. However, I also represented clients in many different areas of the law, both civil and criminal, including auto safety, issues regarding the Securities and Exchange Commission and Federal Communications Commission, and contractual matters. I had projects with an international dimension, and I functioned on legislative matters. I had an extensive appellate practice. In addition, I had an opportunity to become involved in significant pro bono projects. My experience was not unique among the lawyers of my generation.
It would be difficult for a young lawyer today to handle such a broad range of matters. Clients seek out specialists who have expertise in a particular area. They want lawyers who have had previous experience with similar matters. Within a short time after entry into firms, young lawyers are directed to a particular area of practice, and they are expected to cultivate expertise with respect to a specific subject.
There is, of course, both a downside and an upside to specialization.
Lawyers do gain a deeper, wider knowledge of a particular area. As a
general rule, clients benefit from this trend. On the other hand, specialists
may lose the capacity to see connections and relationships with other
areas, and they tend to become narrower and less imaginative.
In remarks at the Yale Law School commencement in May 2004, Professor John Langbein characterized the “lengthening of the work day and the work week, manifested in the pressure to increase billable hours” as “the most worrisome change in big firm practice.” Langbein deplored these “patterns of overwork ... as transparently wrong.” In his words, “These patterns cause grievous disruption to family and personal life, they foreclose opportunity for lawyers to participate in public and community affairs, and they intrude upon the potential for religious and cultural fulfillment. In short, these workloads diminish the lives of those who lead them.”
Langbein is right in pointing to the pressure on associates in large firms to work a substantial number of billable hours and the consequences of doing so. Some firms have established annual quotas, in the neighborhood of 2,000 billable hours, or the equivalent of 50 40-hour weeks. Billable hours of that magnitude entail spending a high number of nonbillable hours in the office. Such quotas cannot be met without working a substantial number of nights and weekends. Some firms announce associates who work a specified number of billable hours will be paid a higher salary or a bonus.
Firms that do not have billable-hour quotas take into account the number of billable hours by an associate in making decisions with respect to advancement; associates are made aware that high billable hours are a plus factor in election to partnership, and that billable hours below the average of one’s contemporaries pose a handicap. Any associate with ambitions to advance to partner must satisfy these quotas. These pressures are not limited to associates—the records of partners also are scrutinized, and partners with low billable hours may be questioned by compensation committees, incur financial penalties, and have their advancement impeded.
The habit of working long hours is not unique to big law firms. It was the custom in my firm, when I was a young attorney, to work long hours, and friends in other firms in Washington reported the same thing. We were expected to complete the task, however long it might take.
There are, however, several noteworthy points of difference between the situation in the 1950s and that of today. First, among many married couples in the 1950s it was understood that men would work and that women would remain at home and care for the children. That social contract is a thing of the past; women now have careers of their own, and men are expected to share in rearing children. Oppressive work hours can be disruptive to family life. In addition, associates in the 1950s and 1960s felt they had a realistic chance to become a partner; long hours were an investment in the future. Today, the probability that an associate will rise to partner has been substantially diminished, and there is less motivation, but more pressure, to put in long hours.
A significant percentage of the associates in large firms are dissatisfied and disappointed by their work experience. There are a number of reasons for their disaffection: the long hours of work, the dissonance generated by the tension between the idealism of young lawyers and the realities of a large firm practice devoted to representing corporate interests, the drudgery associated with working on large matters, and the lack of mentoring and the impersonal character of large firms. A number of law firms have sought to address the last factor, but the morale problem persists as evidenced by the high exodus rate of associates. The rate of associate attrition at large law firms is astronomic; a recent study by the National Association for Law Placement (NALP) ascertained that nearly 60 percent of all entry-level associates at firms with more than 500 lawyers departed by the end of their fourth year with the firm.
In the 1950s large firms were located in a single city. Their practice was derived from clients nationwide, and lawyers traveled extensively for meetings with clients and court engagements, but the firm was based in one locality. Cravath was perceived to be a New York firm, Jones Day a Cleveland firm, Covington & Burling a Washington firm, and Kirkland & Ellis LLP a Chicago firm. A few firms had an office in London or Paris, but that was unusual. Today, it is commonplace for large firms to maintain branch offices in a number of cities. Moreover, a significant number of firms have established offices in foreign countries; their practice is globalized. White & Case LLP, a firm with more than 2,000 lawyers, has 35 offices located throughout the world.
The branch office development by law firms has paralleled the globalization of business organizations. This phenomenon in legal practice reflects the belief that large multinational corporations prefer to use lawyers in the same firm. Their business operations are far-flung, and corporations deem it advantageous to have outside counsel in the same geographic areas as their business operations. In addition, many transactions have multinational aspects. For instance, a merger may involve firms with operations in a number of countries, and it is necessary for counsel to deal with government authorities in each of those countries. Branch offices may be helpful in dealing with such officials. Moreover, a law firm in Country A with an office in Country B may enjoy an advantage in obtaining the legal work of a business located in A that involves Country B, and vice versa.
From the perspective of lawyers within a firm of this type, multibranch offices present a number of issues. First, operations of this magnitude require a large commitment of managerial and administrative resources, and it is a major challenge to integrate such branches with one another.
Second, when a firm is so widely scattered, it is virtually impossible to speak of a common firm culture. In the firms of the 1950s, the associates who became partners had grown up together in the law firm, they knew one another, and they tended to share a common set of values with respect to legal practice and the firm. When a firm has many branch offices, that is impossible. Partners do not know most of their colleagues or know them only tangentially. The bonds that link them are limited. That, in turn, reinforces the practice of making decisions by a small group on a bottom-line basis; it has solidified the transformation from a partnership to a corporate culture.
Third, it is difficult to make decisions based on a uniform firm-wide policy. Partners in Office A may be called on at a partnership meeting to vote on the election to partnership of associates in Branch Office B, but they know almost nothing about such associates. Differences in competitive conditions may force the firm to compensate lawyers in some cities differently from lawyers in other cities, which can be divisive.
Fourth, ethical issues, such as problems relating to conflicts in representation, multiply. Divergent ethical rules in different jurisdictions also raise troublesome issues.
Training Young Lawyers
The late Judge Simon Rifkind once analogized the training of young lawyers in large law firms to the teaching of medical residents in a large hospital. He stated: “Although the public generally is familiar with the term ‘a teaching hospital,’ the idea of a teaching law office has not yet been articulated. It is nevertheless true that, like the great teaching hospitals, the great law offices have become teaching institutions. They train young law school graduates to cope with the exceedingly intricate and complex legal problems which confront American business today. Indeed, that is the only place they can learn their craft.... Such transmission of the craft from one generation to the next is, in a great law office, accomplished not only by the method of watching a seasoned expert, but also by formal instruction. This is certainly true of well-known litigation departments of the great offices.”
Although large firms continue to perform this training function, it has been adversely affected by increased financial pressures. Associates are pressed to work a high number of billable hours, and this limits the amount of time available for training. The supervision and feedback involved in training takes time, and partners generally have less time available for that purpose. This may result in increased outsourcing of training and a diminution of in-house training.
As Judge Rifkind noted, “an apprenticeship under a good master” is a critical part of learning the craft of lawyering. In the past, when firms were smaller, partners knew many of the associates, and they had an interest in training them for the reason that a goodly number of associates would become partners in the future. However, as to many associates with whom they now work, partners do not have such an interest. As I have noted, the turnover rate of associates at most large firms is extremely high, and only a handful of associates will be elevated to partnership. There is, accordingly, a diminished incentive for partners to invest valuable time in training associates who may be gone from the firm in a year or two.
Ethics and Professional Responsibility
Ethical standards have been weakened by compensation systems geared to business generation, economic pressure to meet firm budgets, and the intense competition for legal business. Nearly every one of the changes in the profession I have described has generated problems of professional responsibility.
For example, the collapse of some large companies in the past several years has revealed the enormous pressure on counsel to issue opinions clearing questionable transactions. Deference may be given to the demands of a major client that accounts for a significant percentage of a law firm’s annual gross revenues. The pressure to bring in a substantial new matter leads to rationalizing the abandonment of an existing client and to resolving client conflict issues in favor of a newcomer. In high-stakes litigation, financial pressures have led to widely publicized incidents involving the suppression or destruction by counsel of relevant documents and information.
The search for new legal business has generated solicitation practices unimaginable a half century ago. Many law firms now have departments that develop marketing strategies for attracting new clients.
The large fees charged for a major matter—such as representation in a corporate tender offer battle or the fees now sought by counsel in class action cases and mergers—have shattered long-accepted notions of a “reasonable fee.” Fees of this magnitude have undermined the notion lawyers are members of a learned profession rather than businesspersons.
The major law firms in the 1950s were composed almost exclusively of white, Anglo-Saxon Protestant men. A firm that includes Catholics, Jews, Asians, members of other ethnic and religious groups, and women will have an altogether different culture. The new culture is much less formal, more entrepreneurial, more hospitable to new ideas, and probably less collegial. The disintegration of entry barriers for women, African Americans, and other minority groups will result in further dramatic changes in the culture of law firms.
Half a century ago, there were only a few women in the legal profession. When I was a student at the University of Chicago Law School in the late 1940s, there were only about a half dozen women in a class of 125 students. There were no women professors. In the winter of 1950, I visited friends in Cambridge, Massachusetts, and I discovered that there were no women in the Harvard Law School.
As far as I can recall, there were no women associates in the principal law firms in Washington in 1950. There were a few women in the U.S. Department of Justice—notably the legendary Beatrice Rosenberg in the Criminal Division—and there was one woman in the mid-50s on the U.S. District Court for the District of Columbia, Judge Burnita Shelton Matthews. Arnold, Fortas & Porter hired its first woman associate in 1952: Patricia Wald, subsequently a Federal Court of Appeals judge and a judge on the International Tribunal for the former Yugoslavia.
The percentage of women in the profession did not change much until around 1980. An American Bar Foundation study shows the following with respect to the number of women in the profession:
Women Lawyers: Number and Percent in Lawyer Population in Selected Years
|Year||Number of Women||Percentage of Lawyer Population|
Women account for approximately one-third of the profession, and that number is projected to grow. In most major law schools, the ratio between men and women is about 50–50.
Although there are a substantial number of women associates in the large law firms, women still account for fewer than 20 percent of the partners, and they are significantly underrepresented in the upper levels of the management of law firms. A number of factors probably account for the high level of departure by women associates and the relatively low percentage of partners. The traditional demand by large law firms of single-minded dedication to practice is one factor. A Harvard University economist, Claudia Goldin, commenting on the controversy with respect to women in science, made the following observations which are pertinent to the situation facing women in law firms: “[The firms] expect a large number of hours in the office, they expect a flexibility of schedules to respond to contingency, they expect a continuity of effort through the life cycle, and they expect ... that the [employees’] mind is always working on the problems that are in the job, even when the job is not taking place.”
Many women understandably find it difficult to satisfy these demands and expectations consistently with obligations they feel toward their families. They are much more likely than men to seek leaves of absence and work assignments that do not entail such commitments, which in turn affect opportunities for advancement.
One factor generating change is that an increasing number of women occupy important executive positions in business and in corporate legal departments, and such women welcome their counterparts in the private law firms as counsel. The status of women and their working conditions in the profession have vastly improved in the past half century. Stereotyped views of women still persist, but they are less prevalent. Law firms have become responsive to the special concerns of women as childbearers and as parents. Provisions are made for health insurance during maternity, day care centers and other child care arrangements are widespread, leave time for maternity is universal, and many law firms are prepared to negotiate flexible time arrangements for women with children. Nevertheless, women who work fewer hours are less likely to be elevated to partnership, and it remains a major challenge to balance a career in a high-powered law firm with parental responsibilities.
In his talk at Yale, Professor Langbein stated: “The excessive time demands characteristic of large-firm practice weigh disproportionately on women, who tend to be the primary caregivers for children and sometimes for elderly parents. The struggle to get the firms to rethink these hours is largely being led by women. Indeed, the growing feminization of the legal profession is the most important counterforce that is coming to bear against the ethos of overwork that pervades so many large firms. I think that a legal profession that is 40 to 50 percent female, which is where we are headed, is not going to tolerate 55- and 60-hour work weeks.”
Langbein may be right, but it is not clear how law firms will resolve the conflict between the demands of law firm managers and clients and the demands of women in the firm. The pressure to work long hours is not only fueled internally within the law firms by the desire to maximize net earnings for partners, but also is a response to the insistent demands of clients whose operations are worldwide in every time zone.
Women lawyers and judges significantly have influenced the substantive law in a number of areas, such as gender discrimination, domestic violence, and the law pertaining to reproductive rights. It is not yet clear how the increase in the number of women lawyers will affect the manner in which law is practiced. Will it lead to changes in the law firm’s work ethic as suggested by Professor Langbein? The potential ramifications of the feminization of the profession remain obscure.
A parallel change involves the growth in the number of minorities in the large firms. There were three African American students in my law school class at Chicago in the late 1940s. It would have been futile for them to seek employment with the vast majority of law firms; discrimination was widespread.
In Washington in the 1950s, there were no African Americans in the large law firms. Black lawyers in the city primarily represented clients in their local communities. The Bar Association of the District of Columbia, the organization of District lawyers, excluded black lawyers from membership. I have a vivid memory of the dramatic meeting of the Bar in the mid-1950s when a group of the city’s younger lawyers banded together to eliminate this rule and to admit black lawyers.
There is a profound difference between the employment opportunities for black law school graduates a half century ago and the situation that prevails today. Discrimination in employment is now illegal, and the large law firms aggressively recruit black graduates. To some extent, this policy may be a result of the pressure exerted by corporate clients who insist on diversity in the legal staffs of the firms they retain. But I believe this hiring policy basically reflects the view that racial discrimination is immoral and unjust. Black persons account for about the same proportion of associates as they represent in law schools, roughly 8 percent. However, there is a very troublesome aspect to the black experience in large law firms. The rate of attrition of black associates is extremely high, perhaps two to three times that of their white counterparts. Further, the percentage of black partners is extremely low. A significant number of black lawyers leave their law firms for jobs in the government and the corporate sector. A literature of formidable magnitude addresses these issues.
One theory, advanced in the mid-1990s by David Wilkins and G. Mitu Gulati, is that the tenure and advancement of young black lawyers are profoundly affected by stereotyped beliefs and preconceptions of partners concerning the capabilities of black associates that lead them to be pessimistic about the quality of work they will receive. Few blacks, they state, are viewed by partners as “superstars” who will develop into firm leaders. Black associates experience difficulty in finding mentors and tend to receive less training and mentoring and fewer challenging assignments and responsibilities, all of which are critical to advancement. Disappointed and frustrated, these associates leave the firm long before they are eligible for partnership.
Another hypothesis was advanced recently by Professor Richard H. Sander of the University of California at Los Angeles, who carefully examined a mass of statistical data concerning law school graduates and law firm hiring practices. Sander’s theory, in substance, is that large law firms seek out students with excellent academic credentials, that outstanding law school performance is in relatively short supply among minority students, and that firms seeking diversity in their cadre of associates hire black students who, on average, have law school grades below those of white students hired at such firms.
Sander states that black associates tend to be perceived by partners as less able and that “minority associates quickly find themselves receiving far less mentoring and training than they want, performing less challenging tasks, fewer substantive assignments, and not developing the close informal relationships with partners that will be signified by regular social interaction. They find themselves marginalized and superfluous, and their predictions that they will not be long with the firm are fully borne out.”
The situation appears to be improving, albeit very slowly. One of the most helpful developments is deeperawareness of the problem and a desire to implement changes that will yield meaningful diversity.
In the 1950s when I entered practice, there were no computers. There were no fax machines, or e-mail, or cell phones, or Palm Pilots, or laptops, or BlackBerrys. There were no Xerox machines. Documents were duplicated by a cumbersome process resulting in awkward copies. I can still recall my astonishment when I first saw Xerox documents in the early 1960s. Further, there was no electronic filing of court dockets, and court opinions could not be immediately retrieved.
The new information technology has been an important factor in reshaping the way law is practiced. The megalaw firm with numerous branch offices would not have emerged in the absence of computers.
Judge Richard Posner observed a decade ago that “The use of computers for document preparation, indexing, and legal research, and of facsimile machines and other communications equipment, has increased the traditionally low capital requirements of law firms, raising the minimum efficient size of firms and hence contributing to the astonishing growth in the average size of firms.”
More recently the costs of information technology have been mounting with the result that small firms are finding it increasingly difficult to match the technology capabilities of large firms.
Technology has changed legal practice in many ways.
First, it has relieved associates of some tasks that were once laborious and time consuming. It is now possible to say with considerable certainty that a search for all of the relevant precedents or statutes in all of the states on a particular point of law is comprehensive, or that all of the thousands of documents with respect to some issue have been reviewed.
Second, it has improved a firm’s ability to manage transactions and those situations where documents are standardized and need only be adapted to the particular matter.
Third, in a large case involving many lawyers within the firm, it is now possible to communicate rapidly with colleagues. Lawyers located in branch offices in different cities who are working on the same case or transaction can quickly exchange information.
Fourth, it has facilitated deposition and trial practice. To illustrate: A lawyer taking or defending a deposition can instantly gain access to relevant documents. In the late 1990s, while I was engaged as trial counsel in an antitrust case in the U.S. District Court for the Southern District of New York, I was invited by the court to participate in the experimental use of screens located on counsel’s tables that would simultaneously display ongoing proceedings in the courtroom. This real time technology expedited the trial. For example, objections on the ground that a question had been previously asked and answered could not be ruled upon by the court without the laborious rereading of the transcript by the court reporters. Such objections could easily be resolved by scrolling the screen.
Fifth, new technology has improved communications with clients. For instance, in the past a client might call outside counsel to consult about a suit instituted against the client. It was frequently a time-consuming task for counsel so contacted to assemble information concerning the proceeding, but with current technology, such data can be downloaded in a few minutes.
Are clients more efficiently served as a result of the new technology? Are lawyers better able to advise and assist clients? Yes, I think so. I am doubtful, however, the new technology has enhanced the satisfaction an individual feels in being a lawyer.
Finding that Fire
If history is a guide, there will be significant changes in the legal profession in the next 50 years. The momentous changes in the profession during the past half century have enhanced the ability of lawyers to serve clients more effectively. Competition among lawyers is beneficial to clients. The lowering of barriers to entry into the profession because of gender, religion, race, or ethnic background is certainly a praiseworthy development. On the other hand, I do not find among young lawyers of today that I encounter the sense of excitement about their work, or the pride in being a lawyer; that was the case for many young lawyers of my generation. It was fun—indeed, it was exhilarating—to be a young lawyer in Washington in the 1950s and 1960s. There was a sense of adventure. I rarely encounter that spirit today.
Given the present economic structure of the profession, I wonder whether we will see a renaissance of that spirit among young lawyers. There are exciting challenges confronting the profession—the internationalization of many legal issues and the pressing need for reform of our system of civil and criminal justice. Perhaps, these may inspire a renewal of the spirit that prevailed a half century ago.
Abe Krash, an adjunct professor at the Georgetown University Law Center, is a retired partner at Arnold & Porter LLP.