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Are big-firm lawyers' long hours necessary for success?

Professor Bainbridge asks:

Nearly three-fourths of respondents who have a spouse or children said that work cuts into family time ''somewhat more'' or ''far more'' than they'd like. More than half of all respondents -- about 54 percent -- said they would reduce the number of hours they work, with a corresponding cut in pay, if they had the option.

The survey showed that how much money a lawyer makes corresponds almost exactly with how much work reduces family time. In the open-ended responses, lawyers said over and over again that achieving a high level of success in the profession simply demands putting in long hours.

But if lawyers can (and do) make more money by working more, why isn't that equally true of other professions whose practitioners seem to be enjoying more leisure? And why hasn't the market made available options for lawyers who would be willing to take a cut in pay to work fewer hours? Very curious.

There seems to be a huge collective-action problem. It would be very easy for the Fortune-500 companies spending $400-$500/hour for senior associates and junior partners who do the bulk of the substantive work for them to announce that they will provide start-up money and a guaranteed base of work for a lower-overhead firm that bills at 80% of the rate for 80% of the hours/year, but makes the same amount of money because they're not kicking leveraged money upstairs to senior partners or paying a fortune for a mahogany-lined library. (I once calculated that I could put food on the table and keep a roof over my head with 30% of the billable hours at two-thirds of my big-firm billing rate if I were willing to be my own office manager. But I couldn't recruit clients until I left the firm, and I was too risk-averse to leave the firm without that 30% baseline book of business in place.) The company's investment would pay for itself in a year in lower billing rates; the work would be, if anything, higher quality, because it's done by the same people who aren't suffering from burnout. Yet no one does it, because (1) the GC wants the option of the revolving door back into the large law firm and senior partnership under the status quo, and (2) what I call the punt-on-fourth-down syndrome.

In the NFL, coaches who go for it on fourth down and fail are second-guessed viciously by the press, even when it's the statistically correct thing to do. Even a risk-neutral coach will feel that it's better to have a 40% chance of winning and 0% chance of being second-guessed than a 60% chance of winning and a 40% chance of being second-guessed. In a similar principal-agent problem, noone second-guesses the GC who pays for the top-dollar firm and then settles a winnable case. Rare is the Altria or State Farm or DaimlerChrysler that is willing to risk the bad publicity of a big judicial hellhole verdict and wait out several years to see justice fully done; even rarer are the GCs who question whether they have to pay a premium for the brandname law-firm when they could get the same work from the same lawyers from a spinoff for cheaper. Noone will second-guess a GC who has a bad result after hiring a prestigious firm, but the decision to hire a no-name firm would be scrutinized much more closely after a bad result, even if it's essentially the same attorneys doing the work.

Even if there were "Moneyball" GCs out there seeking an advantage, some junior partners wouldn't want to do this; they may like working the long partnership hours, and can eventually become the senior partners taking advantage of the full leverage under the status quo. Others work for law firms that still have the collegiality to carry a partner who has an off-year or two in business generation, and thus would prefer the risk-averse status quo at the cost of putting in extra hours. But as more and more AmLaw 100 firms abandon the "tenure" model of partnership and lockstep compensation in order to juice PPP, there are certainly other young (and old!) partners who would gladly trade income in after-tax pay for several hundred fewer hours in the office, if they could feel secure that they wouldn't be punished in the marketplace for failure to associate themselves with a "name" firm.

There are entrepreneurial attorneys who have made this happen. Harris, Wiltshire & Grannis in Washington, DC, has a successful telecommunications practice that pays close to market rates despite averaging about 1500 billable hours a year, because the partners (who include former Supreme Court clerks) don't insist on a seven-digit PPP. Summit Law Group in Seattle combines a casual non-hierarchical environment with a customer-friendly ethic that includes a "value adjustment" line-item on every bill to permit the client to adjust the bottom-line total up or down to reflect the client's perception of the value of the work performed. And, of course, Howard Bashman opened up under his own shingle two years ago. Will we see more firms like this? I know that if I were a GC, I'd try to encourage the trend.



Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.