New York Lawyer
April 16, 2002

Q:
Like a lot of burned-out large firm lawyers, I�m seriously contemplating a move in-house. The idea is that while I will lose some income potential, my professional life will become more manageable and somewhat less demanding. Am I just kidding myself?

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A:
Thousands of lawyers have the same idea � giving up the rigors and competitiveness of law firm practice for what they perceive as the comparative serenity of working in-house. While 20 years ago articulating such a prospect might get you labeled as a slacker, a wuss or someone incapable of tracking billable hours, in recent years it has become one of the more alluring rescue fantasies.

What are the realities? First of all, it�s very dangerous to generalize, so watch out for buying into conventional wisdom. �In-house� is a huge category with an enormous variety of venues, roles, responsibilities, earning curves, satisfactions and frustrations. Some large legal departments look and operate a lot like law firms in terms of their structure and degree of specialization. Some even require staff attorneys to track their time; while this is used for cost-management purposes rather than calculating revenue, the process of monitoring the minutes may feel much the same as the daily grind down at Big, Bigger & Biggest. At the opposite end of the spectrum, being an in-house generalist jack-of-all-trades in a freewheeling entrepreneurial setting may be about as far from large-firm life as you�re ever likely to get.

So what can we safely say? Although the subject matter of your daily work may be very similar to your law firm discipline, there is a very fundamental difference between firm practice and in-house employment. In the former, you are a profit center, and your mandate, in addition to practicing good law, is to practice a lot of law. You are on the revenue side of the house � where things like sales, marketing, client development and billing are the defining criteria for success. In-house, you are a cost center. You may perform a valued function, but you don�t make the company money; you cost it money. That�s okay, but remember that this fact creates an incentive for the company to try to minimize your cost � so you�re unlikely to make as much as you did in private practice. You�re less likely to be paid on individual merit and more likely to simply have your salary range determined by the corporate compensation plan categories. In MBA parlance, you are on the �staff side� of the org chart (along with HR, IT, Facilities and other roles based on specific technical competencies), rather than on the �line� side � the side that brings in the bucks.

For some people, this shift in role and status is entirely comfortable. They don�t want to be rainmakers or constant self-marketers. They like the idea of a stable salary, even if it comes at the cost of some upside earning potential. For others, their technical support role may make them feel ancillary to the fundamental purposes and operations of the business.

Also, it is self-evident that when you�re in-house you�re working for only one client. Some people really like that: it can create a greater feeling of involvement and continuity, more sense of �home,� more involvement in the organizational �culture,� less feeling that you are a hired gun who rides into Dodge, performs some specific project or task, and than rides on (leaving a bill behind, of course). Where the in-house role includes participating in the company�s strategic and operations planning (if only as a risk-reducer), staff lawyers may like their broader involvement and perspective. �I conceive, plan, negotiate, close and document an entire deal,� says one. �I�m not just a scrivener anymore." Ramping up your capabilities as a counselor and not just a technical pair of hands does require you to learn more about the business -- its goals, plans and operations. Law firm lawyers moving in-house often are marginalized for awhile because "they just don't know the business."

As a safe generalization, DON�T get the idea that in-house life automatically is going to be easier. While it is true, particularly for ex-litigators, that the hours may be somewhat more manageable, it does not follow that they necessarily are shorter. Count on putting in long hours. Maybe they�ll be fewer Saturdays behind the desk, but few in-house roles have bankers� hours and cream-puff responsibilities. Moreover, as part of a cost-cutting trend, many legal departments are pulling a variety of functions in-house that they used to farm out to firms. This doesn�t mean, however, that the legal department automatically is hiring more lawyers; often it means that the existing staff is compelled to take on more responsibilities. In some cases, it also means that in-house roles are becoming as specialized as law firm practice areas were. This can give you a lot of clout if you�re the expert in some crucial area, like patent law or IP. However, it also can result in your rowing your boat in small, endless circles, without the variety and challenge that keeps the mind alive.

The shock of transition from law firm practice to in-house employment can be fundamental and astonishing. Pam Woldow, a former environmental litigator with a prestigious firm and now head of litigation and risk management for a publicly-held financial services giant, puts it succinctly: �You are not the big dog anymore, not the big kahuna. You are not at the head of the food chain. The organization doesn�t revolve around your skills and activity, like a law firm. You�re there to support other people. You have many constituencies, and your role is to make life easier and safer for them, not the other way around. Your opinions, which had ultimate authority when this same company was paying you $400 an hour as outside counsel, suddenly get discounted, second-guessed � or second-guessed by outside counsel at $400 an hour. Worse still, your prudent advice may get you pigeonholed as a trouble-maker, a deal-breaker, or subjected to the ultimate corporate slap: �you�re not a team player.��

"Working in-house requires a lot of simultaneous translation," says Woldow. "As a law firm lawyer, particularly where litigation is concerned, you're usually talking to another lawyer -- your 'client' is in the corporate legal department. They're trained to think the way you do and they speak the same jargon you do. When you become an in-house lawyer, your must communicate with a variety of constituents who aren't lawyers (and may not like lawyers), don't speak legalese and need things explained to them in lay people's terms. You have to learn how to avoid lengthy legal explanations and cut to the chase. You have to show you're attuned to their needs and priorities. You have to be helpful, not merely expert."

It took Woldow a year to get fully comfortable with the shift in authority and interpersonal style required to be an effective in-house lawyer. �You can�t order people around, or threaten them with the same effect,� she says. �You have to learn to be more collaborative, to compromise and be less self-righteous or dogmatic. You�re the tail, not the dog. I�ve come to love it and wouldn�t go back. But man, those first few months were a real wake-up call.�

Sincerely,
Douglas B. Richardson
President, The Richardson Group