1st Legal Outsourcing Summit: Good Contracts Needed in Growing Industry

Law Practice

1st Legal Outsourcing Summit: Good Contracts Needed in Growing Industry

Posted Jan 22, 2008, 02:30 pm CDT
By Martha Neil

A first-time summit in New York City last week of Indian legal process outsourcing companies and their counsel shows how the industry—which could result in some $4 billion in foreign legal work being sent to India by 2015—is growing.

However, some issues in the fledgling industry remain unresolved, such as potential liability because of differing standards of practice in the U.S.—which provides much of this legal work—and in India, reports the New York Law Journal (sub. req.) in an article reprinted by New York Lawyer (reg. req.).

Good contracts detailing what is expected from an Indian LPO provider are critical to resolving such potential differences, although many of the companies that contract with Indian lawyers to do other countries' legal work now are based in Europe and insured in much the same manner as a U.S. firm would be, according to speaker Gregg Kirchhoeffer of Kirkland & Ellis and Robert Glennie, the managing director of NewGalexy, a British-based LPO that also has offices in India.

"With U.S. lawyers, you always have the rules of ethics," Kirchhoeffer says. "Going to a service provider offshore, you have to replace that gap-filler with contract." Some contracts, for instance, specify that computers used by Indian lawyers in LPO companies can only have limited Internet access, to prevent inadvertent disclosure of confidential documents.

One reason for the growing popularity of LPO companies among U.S.-based companies and law firms is their cost: an Indian lawyer may make $10,000 a year or less, according to the legal publication, although clients can be charged as much as $30 per hour for their services. Even the lowest-paid American lawyers, of course, make considerably more.

However, Indian lawyers are a better bet, because they are happy to have these jobs, says David Perla, co-founder of LPO Pangea3, which is based in New York by has 240 lawyers in three offices in Mumbai, India. By contrast, the lawyers who do such contract work through U.S. legal staffing agencies, he says, "are the ones who couldn't make it as real lawyers."

ABA Journal: "Manhattan Work at Mumbai Prices"

ABAJournal.com: "Rules Unclear re Supervising Indian 'Lawyers' "

ABAJournal.com: " ‘Attorney at Blah’: JD Earns Extra $20/Hour in Doc Review"

ABAJournal.com: "Hollywood Outsourcing Higher-End Legal Work to India"

Comments

Report Abuse

Posted by J. - 6 months, 4 weeks, 1 day, 7 hours, 54 minutes ago

OF COURSE, this has been happening in pretty much all other industries for about two decades.

Unfortunately, the legal class didn’t speak up.

And now it’s happening to us.

Goodbye, U.S. of A.!
Posted by dm - 6 months, 3 weeks, 5 days, 18 hours, 21 minutes ago

I worked in the Tech industry during the bubble, when they just could not get enough engineers. While some of the Indian guys I worked with were brilliant, highly organized individuals, the level of chicanery that went on with the others was nothing short of shameless. I expect this will last a short time until it comes back to bite people on the butt. No matter what certain publications say about the quality of outsourced work, the truth is the level of legal education in India is substandard.
Posted by BIGLAW 1ST YEAR - 6 months, 3 weeks, 5 days, 17 hours, 55 minutes ago

dm, you are ethnocentric and probably racist. You also generalize too much.

Shipping jobs over to India is a good thing. Hopefully we will see less unqualified individuals going to law school here who are going to end up in these brainless low-paying jobs. We also need to get rid of the large number of substandard law schools in THIS country.

I bet that if my firm outsources maybe I will get paid $250,000 a year!
Posted by Paul DeHoff - 6 months, 3 weeks, 5 days, 16 hours, 14 minutes ago

Sounds like a provision in the legal services contract precluding outsourcing or electronic transmission outside the local firm might be in order for those not wanting to pay top dollar to a firm for work done in Outer Mongolia.
Posted by jugdish - 6 months, 3 weeks, 5 days, 13 hours, 53 minutes ago

I did some of this type of work before bar results were released and landing my first position as an attorney. The work really is not legal work. For example my work consisted of going through tons of contracts a company had already entered into and searching for a few clauses in the contract. Anyone could do that. It is important though that the work is done as accuratley as possible. I don’t really see this as a threat to attorneys in the U.S. because these types of mass document reviews are not that common place in 90% of the work attorney’s do and for outsourcing to be cost effective they have to deal with large quantities.
Posted by J.D. - 6 months, 3 weeks, 3 days, 12 hours, 41 minutes ago

There’s still the issue of ETHICS which we as lawyers are supposed to think about on occasion…

Why would it be cheaper to send work half-way around the globe? Could it be because of crappy labor standards that would be unacceptable here? Is there not an qualm about taking advantage of slave labor?

And what about a sense of national pride? What country in the world would rather hire outsiders than its own people? For capitalism to sustain a nation, there is a need for the businessmen to look not only at the bottom line, but at the social impact of their decisions as well. Outsourcing represents the elimination of ethics from capitalism.

What job CANNOT be outsourced to a place of cheaper labor? If this trend continues, the U.S. will only be habitable by the CEO-class. Our labor laws will become meaningless. The middle class and low-wage workers will have to move to China or India to get work. And it will be under the worst labor standards one can imagine.

Commenting has expired on this post.

ABA Journal - Law News Now

Law Practice