Career & Practice

Lateral candidates continue to raise 'red flags,' research company says

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Nearly one-third of all lateral candidates in 2022 raised “red flags,” which include undisclosed business affiliations, cultural incompatibility and inflated books of business, according to Decipher Investigative Intelligence.

Decipher Investigative Intelligence, a provider of prehire due diligence for law firms, reported that this number is slightly down from 2020 and 2021, in which 34% and 32% of respective candidates came with red flags. However, it said the number of candidates with warning signs was higher in all three years than in 2019, when 21% of candidates had warning signs.

The American Lawyer has coverage.

Greg Hamman, chief data officer at Decipher Investigative Intelligence, attributed the increase in candidates’ red flags to the busy and largely virtual hiring environment during the COVID-19 pandemic.

“One reason [for the increase in red flags] is the explosion of laterals we’ve seen in the market,” Hamman told the American Lawyer. “It underscores the risk that we’ve seen firms have in hiring.

“Our position is we are going to be transparent about the issues related to the particular candidate. It doesn’t necessarily disqualify a candidate but it’s important the firm knows that information in the prehire phase as opposed to finding it out post-hire.”

Other consultants told the American Lawyer that the higher number of red flags may have resulted from firms’ broadening of their candidate pool in recent years.

“In normal times, BigLaw firms are pretty strict about their hiring practices, but when they open up the talent pool, there is a higher concentration of those types of issues,” Brian Levinson, founder and managing partner of Alevistar Legal Search, a legal search and staffing firm, told the American Lawyer.

According to Decipher Investigative Intelligence’s data, first-quarter associate lateral moves increased more than 80% from 2020 to 2021 and 2022, the American Lawyer reports. Meanwhile, first-quarter lateral moves of all lawyers increased more than 75% from 2020 to 2021 and 2022.

Consultants also noted that candidates are compensated based on their books of business and could be overly optimistic about what they could bring to the firm. In other cases, cultural compatibility may only become an issue after a lawyer returns to the office after many months of remote work.

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