Legal-process outsourcing: is it the future?

Mar 07, 2019

Written By Jan Hill

JAN HILL looks into one of the fastest-growing trends in the legal industry: legal-process outsourcing (LPO) companies.

Legal-process outsourcing refers to the process followed when a law firm or corporate legal department obtains legal-support services from an external law firm or legal-support services firm.

Typically, a lawyer will contract directly or indirectly through an intermediary with an individual or a firm to perform various legal-support-related services. Once thought of something that only the largest commercial-law firms would consider doing, LPO is now making its way to small- and medium-sized firms as well, to help them cut costs and remain competitive.

Outsourcing might also ultimately change the role of trainees, freeing them up so they can take on more responsibility earlier in their careers. However, outsourcing is also affecting demand for trainees, with roles being outsourced offshore or to lower-cost regions of the UK, and artificial intelligence being utilised to perform the administrative work formerly assigned to trainees. The legal marketplace is changing rapidly, and clients can now seek legal assistance from a growing number of non-lawyers. E-discovery, patent applications and litigation support were all traditionally done in-house by junior lawyers and legal assistants, but these tasks are increasingly being outsourced.

Law firms are also outsourcing legal research, document drafting and review, compliance assistance, and the review and management of records.

When a law firm thinks about LPO, it needs to consider regulatory obligations, desired benefits and the impact outsourcing might have on the firm. It’s essential that the firm also carries out in-depth due diligence on potential LPO vendors to ensure it meets and exceeds the risk-management needs, including client confidentiality, data protection and any potential conflicts of interest.

How can non-lawyers assist in delivering legal services?

Paralegals

More and more lawyers are realising the benefits of outsourcing lower-feepaying work to paralegals, which can enable them to expand their practice, give clients better deals and decrease their own (and their teams’) workload. As paralegals can do almost everything a lawyer can do—apart from specified activities—this is a winning solution all round, according to Amanda Hamilton, CEO of the National Association of Paralegals (NALP).

“Lawyers can use paralegals in a number of ways; outsourcing to an external paralegal, so only paying for the work they do when they do it. Or bringing paralegals in-house to increase the practice’s resources, and these paralegals can be included in the PSL teams to provide support there as well,” she says. “As many paralegals specialise in specific areas of the law, such as housing, debt collection or family matters, this is an opportunity for lawyers to bring in a specialist when needed—without having to support a full-time department.”

Legal consumers in the UK are also beginning to understand what a paralegal can offer and how their services can, in limited circumstances, be an alternative to hiring a solicitor. According to Hamilton, paralegals can be the right choice in certain situations.

Paralegals can assist if someone needs help mounting a defence against someone who is taking them to court claiming they owe them money, for example. Paralegals can also step in if a client needs help on a matrimonial matter, or wishes to take action against an employer through a tribunal, or needs assistance with a housing or welfare matter. Some paralegals have even more niche capabilities, such as police-station-accredited paralegals who can help anyone who’s been arrested and is being held in a police station.

“Paralegals are filling the gap left by the virtual eradication of legal aid, helping both consumers and lawyers,” says Hamilton.

Document preparers

For solicitors, outsourcing document preparation can become necessary if they don’t have the time or ability to do the work in-house. Outsourcing to document preparers can be done temporarily or as a deliberate business strategy if doing so proves to be more cost-effective than producing documents internally.

Legal-document preparers are non-lawyers who are authorised to assist with the preparation of legal documents. The role of a document preparer varies widely across legal jurisdictions, and some acts may be lawful in one jurisdiction and prohibited in others. In 2003, the state of Arizona launched the first Legal Document Preparer Program offered in the US, and almost 600 individual and entity providers are listed as certified by the state’s Legal Document Preparer Board.

Document preparers work in many areas of law, such as matrimony, bankruptcy, wills and trusts, contracts and litigation. For immigrants seeking citizenship in another country, the complicated paperwork is often daunting; therefore, many legal-document preparers work in immigration. Legal-document preparers who work in immigration primarily assist with the preparation of naturalisation applications, employment authorisations, green-card renewals and family petitions, but can prepare most immigrationrelated documents. Many legal-document preparers working in immigration provide bilingual services to assist those who haven’t yet mastered the language spoken in their new country.

Legal self-help sites

Despite the fact that it’s in clients’ best interests to speak with a lawyer about a potential legal issue, doing so isn’t always possible. Those clients (usually individuals rather than large businesses) who cannot afford a lawyer, want to represent themselves or just want to do their own research regarding a legal question often turn to legal self-help sites for helpful information, legal research, document templates and court forms.

In the UK, some well-known self-help sites include the Legal Aid Agency, LawWorks, Citizens Advice and the Free Representation Unit, among others. Some self-help sites focus on a specific jurisdiction, while others concentrate on a particular area of law or type of dispute.

Although these sites don’t provide legal advice, most provide legal consumers with a wide variety of information. Self-help sites provide explanations of a large number of legal terms, suggestions on how best to prepare for a court appearance and the answers to other simple, general legal queries. They can also provide signposting services, such as information on how to find a lawyer, links to legal resources, dictionaries and encyclopedias, and information about specific courts.

No self-help website can provide legal advice on any specific situation. However, many can provide a solid grounding in legal information. Most of these sites also contain a disclaimer to caution consumers that proceeding without a lawyer shouldn’t be taken lightly, and information about the circumstances in which hiring a lawyer might be a good idea.

Virtual assistants

For solicitors who want to spend more time practicing law and less time on non-substantive office tasks, yet don’t feel they have the need for a full-time assistant, a virtual assistant (VA) could be exactly what they need. A VA’s tasks can be specific, or very general.

They might perform a few specific duties just once a month or could assume the role of a remote, part-time employee with a set schedule. VAs can be located abroad or based locally, depending on the solicitor’s needs and requirements.

Some of the tasks that lawyers typically outsource to VAs include bookkeeping, including invoicing, accounts payable and receivables; receptionist work, such as answering and screening calls; initial intake via telephone; social-media marketing and managing your social-media accounts. Other tasks completed by VAs include email management, calendaring client appointments, meetings and court dates, and transcription of correspondence.

Offshore legal vendors

Offshore outsourcing, one of the most common forms of outsourcing, usually involves core and legal-support services that are outsourced to lawyers, law firms and specialist LPO providers located in other jurisdictions. Global outsourcing is growing faster than most expected just a few years ago, perhaps due to increasing economic uncertainty and the fact that the cost savings of offshoring is appealing to a wide variety of clients, large and small.

While offshore outsourcing can result in lower-cost services for clients, quality can be ensured through consistent use of the same provider who specialises in the type of work needed, and has dependable infrastructure support within a solid regulatory framework with minimal language and cultural differences.

Until recent years, the legal profession experienced few, if any, changes in the way lawyers operate, but along with technology, LPO is changing all that. With a renewed commitment to cutting costs while still providing quality legal services, law firms and legal departments are re-evaluating how they conduct business, and clients are increasingly getting more discriminating regarding what they get for their money.

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