Noun, British, The transfer of a military officer or corporate executive to another post for temporary duty
In the legal marketplace, secondment is the loan by a law firm of one of their lawyers to a corporate entity in need of in-house expertise on a limited basis. The law department may need an experienced lawyer to come in and clean up a mess, fill the gap left by a lawyer on maternity or medical leave, or oversee or help with a specific but time-limited project such as to manage an acquisition or lawsuit.
The secondment can be a full time engagement for a period of time (weeks, months, or a year or more), or structured as a certain number of hours per day or days per week, as needed. While flexibility is key with secondments, certain practices are common. Usually the seconded lawyer continues to be paid by the law firm and continues to receive the law firm’s employee benefits. The law firm and the company typically work out a flat fee for the use of the secondment, with an understanding of pricing for any “backup” legal services from the law firm itself, if required.
Done right, secondments are a win/win/win situation for the corporation, the law firm, and the seconded lawyer.
Win: for the corporation
Situations which might be appropriate for a secondment often are difficult to adequately staff otherwise, such as:
- A specific project which isn’t amenable to predictable hours;
- A project that doesn’t promise the continuity the company needs to ensure consistent attention to the end;
- A hire that should be short-term, but available talent is scarce and doesn’t have the expertise/gravitas required; and
- The appropriate hire may seem to be a junior lawyer well-grounded in the substantive law required, but the company really needs someone with the hands-on experience and judgment that comes with being be the only lawyer in the house or on the matter.
The secondment alternative, where a skilled lawyer is assigned to the company as needed at a flat, reasonable, predictable rate, provides the requisite expertise and assurance that the project will be seen through, plus backup skills of other attorneys at the lending law firm if necessary.
Win: for the law firm
Why would a law firm send its lawyers to work somewhere else (while still paying them the crazy salaries they do)?
Secondments provide training for associates in the many firms where the old method of “learning by carrying the partner’s briefcase” is a relic of the distant past The training is not only in the “how to’s” of the substantive law involved but typically provides on-the-job leadership/ownership skills which often are neglected when the junior lawyer is but one of many on law firm “teams.” The seconded lawyer becomes the go-to lawyer who exercises leadership skills and gains the confidence that comes with the assignment. This will carry over to instill confidence in the lawyer’s future client contacts once back at the firm.
Secondments bind the relationship with an existing or new client to the firm. With new clients, the firm has a chance to demonstrate its flexibility by providing the secondment in the first place, as well as by offering its expertise when the seconded lawyer needs backup for the thornier issues. Moreover, there may be opportunities to cross-sell new services when issues ancillary to the secondment arise; and further, with new and existing clients, instilling a reliance on the seconded lawyer who will be returning to the firm.
Secondments are a way to inspire good will when used as an “off ramp” for a lawyer the firm wishes to outplace. Most firms understand that promoting a culture of friendship and collegiality has long-term benefits, and ongoing relationships with lawyers who move on can be a valuable business proposition. A lawyer who is seconded instead of “up and outed” is much more likely to be grateful for the opportunity and inclined to retain the firm when business requires, whether at the company to which he or she is seconded or in future corporate in-house positions.
There’s also a financial advantage for the firm. Law Firm Business 101 teaches that lawyers aren’t financially productive to a law firm until around year three, whether because their learning curve necessitates writing off hours or billing them at reduced rates. Further, general underutilization of lawyers is a continuing issue since hiring the correct number of lawyers for entry-level classes out of law school is more art than science. Sending these more junior lawyers out on secondments at a flat negotiated, discounted rate may actually be more profitable for the law firm that is offering the seconded lawyer.
Win: for the lawyer being seconded
Another Law Firm Business 101 truism is that the successful lawyer is one who understands how her clients’ businesses work. A secondment not only immerses the lawyer in a specific business, but also gives the lawyer a taste of the business world generally, which often is a gap in the background of many lawyers who go directly from college to law school. This is valuable information not readily available to lawyers in the law firm environment.
The seconded lawyer also gains direct client contact. While the secondment is good for the law firm in that it tends to “bind” the company to the firm as noted above, it also is good for the lawyer, who inevitably becomes the client’s firm contact or go-to lawyer when she returns to her firm. This is a huge benefit for the seconded lawyer because “how much business you are responsible for” often is an important indicia of partnership potential.
A secondment also helps position a lawyer for future opportunities. The smart junior lawyer is always seeking to enhance marketability for the next opportunity. If looking for a lateral law firm move down the road, the possibility that this client still sees this lawyer as their lawyer and may well move with that lawyer is a great competitive advantage.
Especially if the lawyer is considering an in-house move at some point, the secondment may be a big plus. The combination of law firm and in-house experience in the form of a secondment is likely to make a candidate more marketable than one who has only law firm experience. From the potential law department employer’s point of view, a stint in-house is more likely to yield a lawyer who isn’t uber-specialized as is often the case with law firm lawyers, who appreciates the in-house issues and pressures attendant to the use of outside lawyers, and who understands the specific industry the company is in as well as the different expectations of “captive” in-house clients.
Becoming more common
Secondments are a common practice internationally, and are becoming more so in the U.S. With potential benefits for all parties involved, corporations, law firms, and attorneys should seek out such opportunities to score a win/win/win.
Co-author Barbara Mayden is a Principal with Young Mayden, LLC in Nashville, TN. She practiced business law for almost 30 years in Atlanta, New York, and Nashville before entering the legal search profession in 2007. She has held many high-level positions in the ABA.