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Should You Consider Alternatives to Hiring General Legal Counsel?

Have you realized that your company continues to encounter legal complications but you are never prepared to handle them? It is probably time to hire a general counsel for your company, or at least consider an alternative. In the last blog entry from Whitley LLP Attorneys at Law, which you can view by clicking here, we discussed the top reasons why companies depend on outsourced general counsel. However, before you spring to the decision to hire an in-house lawyer or built an entire legal department, you should understand all of your options.

Hiring a full-time in-house general counsel may not always be the right fit for various reasons, such as:

  • You might not have the space needed to provide them an office.
  • You might not have enough finances to provide them a competitive salary.
  • You might not have the resources to provide them with employment benefits, like healthcare coverage.
  • You will most likely need to create a full department with general counsel, assistant general counsel, paralegals, secretaries, and so forth.
  • Your company may not necessarily have enough legal work to justify hiring a full-time general counsel or corporate legal department.

Outside Counsel Only When Needed

At the same time, you might be tired of seeing your legal expenses grow out of control by using outside law firms for every legal complication. An alternative to consider is having a lawyer or law firm handle cases on an hourly basis only as needed. This is not really general counsel at all, though. You might be surprised to find the engagement process, or getting ahold of “your lawyer” may be difficult, especially if your company is not considered high-value or a regular client. There is also the added risk of paying unpredictable legal fees that can run up to $1,000 per hour or more once associates’ rates and other stipulations are included. Some lawyers may also inflate the amount of hours they work on a case to meet their billable hour quota.

Alternative Billing Arrangements to Consider

Problems associated with using outside counsel on-demand may be avoided by using alternative billing arrangements, such as flat fees. However, flat fees are usually only arranged for sizeable engagements or contracts. When agreeing to flat fee legal service, there is also the issue of there being no “institutional knowledge” being built up by the attorney. Everything is piecemeal, making it harder to put in place the proper legal and compliance processes necessary, as well as to integrate the legal department with your company’s corporate strategy.

Outsourced General Counsel Might Be Right for Your Company

There is one more alternative method. With outsourced general counsel, your company hires a lawyer or law firm to provide services as general counsel on an outsourced basis. This is similar to the outsourced or fractional CFO services provided by many firms today.

Not all outsourced general counsel firms are equal, though. Some want to “have their cake and eat it too” by charging you for a “basket” of hours, or a certain minimum amount of hours charged per month, and then charge you more if you surpass that amount. That system puts an unfair amount of risk on the client. In a truly fair and equitable outsourced general counsel arrangement, the law firm takes on risk as well, namely that the services that the law firm will have to provide will take more billable hours than the monthly fee would dictate.

Whitley LLP Attorneys at Law offers trustworthy, experienced, and efficient outsourced general counsel to companies and businesses of all sizes and in all sorts of industries. You can click here to learn more about our outsourced general counsel service, which allows your company to get the legal advice and services that it needs at a fraction of the cost of hiring an in-house lawyer or creating an in-house legal department. If you would like to talk to one of our attorneys directly, please feel free to call 888.252.8277 or fill out an online contact form.

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