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Legal Work’s In-House Shift Shows No Sign of Slowing

Michele Gorman | Law360 - July 8, 2020

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Before the pandemic, legal departments were moving more work in-house and relying less on outsourcing, and industry experts predict this trend will continue long after the crisis wanes because of cost savings and the increasing sophistication of corporate teams.

In 2019, 28% of respondents to a survey by the Corporate Legal Operations Consortium said they shifted more work in-house, compared with 20% who outsourced more legal work. The results, which followed up on a similar survey CLOC performed in 2018, illustrate the ongoing legal department trend toward relying less on outside counsel and more on internal resources like technology and legal operations, as well as on alternative legal services providers.

Legal industry experts told Law360 they think the trend will extend beyond the pandemic for most corporate teams because it's a significantly less expensive alternative to using outside counsel. They also cited legal departments' increasing comfort with taking on more sophisticated matters as a reason it will likely carry into the future.

"I do think the trend will continue, and it might even be a little easier to pick up talent right now from a law firm or from a corporation because some corporations haven't been doing as well," said Audrey Rubin, president of Rubin Solutions and a senior adviser at BarkerGilmore LLC.

She said the trend might slow down temporarily as law departments zero in on tackling new and urgent matters and changes stemming from the pandemic, such as how to safely reopen their businesses — on top of dealing with the ongoing issues they previously had before the crisis escalated in March.

But soon, many companies and legal departments will likely take a closer look at and reevaluate their budgets.

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