The Contract Lawyer Conundrum

[Some edits as of 1/16/09]

Over at her blog, Legal Research and Writing Pro, my friend Lisa Solomon summarizes the recent spurt of posts round the blogosphere on the grim life of contract attorneys, who endure low wages, intolerable working conditions and frequently, degrading treatment from other lawyers.  Lisa suggests that these lawyers consider starting their own independent contract lawyering businesses, where they can engage in more substantive work than document review and earn more money by eliminating the middle man – the staffing agency – from their dealings with the hiring firm.  Likewise, I’ve always contended that contract lawyers should think about starting their own law firms instead of settling for low paid and often mindless document review work.

But increasingly, I’m realizing that my advice creates a conundrum for many contract lawyers:  with student loan obligations bearing down, many feel that they can’t afford to wean themselves from contract lawyer work.  Thus, even when a position ends and the contract lawyer uses the downtime to try to start a firm, when another contract gig opens up, it’s often hard for the lawyer to resist the steady cash, and so the firm gets put on hold until the next dry spell.

In addition, I’m also aware that contract lawyering has changed substantially since I started my own firm 15 years ago.  Back then, there weren’t as many contract positions available as there are today, but those contract positions that were available were far more flexible.  As a result, lawyers could handle the contract work but take time off to attend to matters for their own practice. However, many of today’s contract attorneys don’t have that option.  In a buyer’s market, staffing agencies are cracking down and requiring contract lawyers to work long days, every day with few breaks.  Many contract lawyers spend 10 hours on the job and are too exhausted afterwards to do work for outside clients, even if they were able to find it.  In fact, many agencies expressly prohibit solo practitioners from applying for contract lawyering jobs, because of concerns that solos may devote time to their own practices on the contract client’s dime.

Whereas once, lawyers could use contract positions to get a firm off the ground, increasingly,  contract lawyering is becoming incompatible with starting a practice.  Lawyers are forced to choose between contract lawyering and hanging a shingle – and those who are strangled by debt often opt for the guaranteed income that comes from contract work.

So what is the solution to the conundrum or catch-22 of the contract lawyer?

I’ve been grappling with this question for some time now.  Certainly, opening a virtual office is one solution, since the contract lawyer could handle client work during the evenings or on the weekend.  Though that wouldn’t leave much time for marketing, during the periods that the contract lawyer is generating revenue, he or she could hire an even lower-paid law clerk to assist with blog posts or setting up online social media profiles.  This kind of schedule would be extremely demanding but within a year, the contract attorney might be able to build up enough of a financial reserve and a client base to fore go contract work entirely, or at least almost entirely.  As an alternative to a virtual practice, a contract lawyer could meet individual clients exclusively on the weekends – though he’d have to limit matters to those that did not require court or personal appearances.

Contract lawyers might also try to build up the type of independent legal research and writing practice as Lisa Solomon teaches at Legal Research and Writing Pro.  Most legal research and writing assignments can be performed remotely, thus obviating the need for a contract lawyer to take time off a project.  At the same time, many of the better paying research and writing projects require meaty legal analysis and may have a short turn around time – and a contract lawyer would need to ensure that the constraints of his day job did not compromise his ability to deliver high quality and timely work for his freelance clients.

Another possibility would involve a collaborative approach.  Perhaps a group of contract lawyers could team up or create some kind of affiliate model that doesn’t give rise to some of the problems attendant to formal partnerships that Susan Cartier Liebel recently highlighted at Build A Solo Practice.  For example, let’s say that three lawyers decided to team up – perhaps in a (carefully structured) partnership or a loose affiliation.  The lawyers would agree to rotate contract lawyering and business building.  So in the first month, Lawyer A would take a contract work and split the proceeds from the contract gig with the other lawyers.  The financial breathing room provided by this revenue would allow Lawyer B and Lawyer C to forego contract work and focus on building up a practice.  Proceeds from work generated by Lawyer B and C would go to a common firm fund and be used to cover law related expenses and marketing.  When Lawyer A’s gig ended, he could join in the business building, and also work on matters from Lawyer B and C.  Lawyer B would take the next contract gig, and service clients as best as possible, but would have coverage from A and C for thosehe couldn’t handle while on the job.

I’m sure that there are multiple ways to skin the contract lawyer conundrum.  Have any of you successfully moved away from document-review type contract work to opening a practice- and how did you make the transition?  Alternatively, what creative ideas do you have for financially strapped contract lawyers who want to make a go of solo practice?