The new world of legal practice: a second track for associates

Big law is changing the way it does business. Outsourcing is here - only this time, it's not to India, but to out-of-the-way cities in the U.S.

The New York Times reports on the trend for major law firms to have a second track for associates, a "non-partner" track.

The nation’s biggest law firms are creating a second tier of workers, stripping pay and prestige from one of the most coveted jobs in the business world.

Make no mistake: These are full-fledged lawyers, not paralegals, and they do the same work traditional legal associates do. But they earn less than half the pay of their counterparts — usually around $60,000 — and they know from the outset they will never make partner.

These career associates are being moved out from the major metropolitan centers of big law.

Orrick moved its back-office operations to a former metal-stamping factory here in 2002, and in late 2009 began hiring career associates. Costs of living are much cheaper in Wheeling than in San Francisco, Tokyo or its 21 other locations, saving $6 million to $10 million annually, according to Will A. Turani, Wheeling’s director of operations.

“It’s our version of outsourcing,” said Ralph Baxter, Orrick’s chief executive. “Except we’re staying within the United States.”

This is not necessarily a bad thing except in the sense that a lot of attorneys who hoped for big law jobs aren't getting what they planned on. But this new efficiency helps employ people; it's the market at work.

As I noted before on this blog, these changes in the legal profession will increase the pressure on law schools to take measures that will increase the value they offer to students. I believe this will lead to more schools explore non-traditional methods of education - like that which OBCL is pursuing.