As a lawyer who has been seconded twice since being called to the bar in 2005, Mark Johnson knows about the concept like few others.
He says any successful secondment to a client’s in-house legal team comes down to managing expectations on the part of the firm, the client, and the lawyer involved.
Johnson’s first secondment was with a major Canadian mining company; the second with Carillion LLP, which is based in the United Kingdom but has global operations. “Carillion is a leading infrastructure company,” says Johnson, an associate at Blake Cassels & Graydon LLP, currently practising in the firm’s business, infrastructure, and information technology groups in Toronto. “They were interested in having a lawyer at my level sit in with their team to learn their business and their market.” The work resulted in a strengthened relationship with the client, he says. “I do a consistent amount of work. That’s a very big practice area.”
The secondment concept is simple enough: a lawyer leaves his or her firm to work at the client’s offices. The client in effect, receives an in-house counsel for a period of time while the lawyer gains an enhanced understanding of the client’s needs. And, it’s an arrangement that’s becoming more and more attractive to clients looking to maximize their relationship with their law firms.
In terms of money, it’s a variable relationship. Sometimes the lawyer stays on the firm payroll, other times the client foots the bill. “Normally, because of insurance purposes, the lawyer continues to be on the payroll of the firm,” says Claude Auger, the Montreal-based managing partner of Fasken Martineau DuMoulin LLP’s Quebec region. “We bill the client according to the terms we reached with them. Most of the time, the client doesn’t want another employee on the payroll.”
Dominic Jaar has been on both sides of the firm-client divide, having been seconded to Bell Canada from Borden Ladner Gervais LLP. The secondment led to a permanent position. “That’s how my life changed from being an outside counsel to an in-house counsel,” says Jaar, now president of Ledjit Consulting and CEO of the Canadian Centre for Court Technology. And, he says, it’s important for both the client and firm to manage expectations and find a lawyer with the appropriate level of experience.
But, says Daniel Desjardins, senior vice president and general counsel for Montreal-based global transport giant Bombardier Inc., for appropriate terms to be reached, a client must be direct in communicating what he or she needs from a firm and interview several potential secondees. “You’re in effect hiring that person for a few months,” he says. If one firm isn’t willing to provide several lawyers to interview, he advises going elsewhere to build a relationship with another firm.
A secondment can provide an on-the-ground education in a client’s rules, processes, and management style. The seconded lawyer comes to see matters from the client’s perspective.
Indeed, adds Johnson, a secondment can put a lawyer in a position where they replace the sole in-house counsel for a period. “You are stepping in flying solo working with the senior executives,” he says.
Johnson says his secondments gave him a deeper understanding of the individual clients’ needs, and made him better able to respond to clients’ needs once he returned to the firm. “It’s working with the engineers and the accountants. The intent is to build strong bonds between the firm and the client,” he says. “It gives the client another point of contact with the firm. It’s someone else in the firm the client trusts. It makes it easier to pick up the phone and have a quick conversation about where things stand.”
Johnson adds seconded lawyers find out what irks clients about external counsel. And because in-house counsel are in highly demanding roles, they need external counsel to respond efficiently to their needs. “It’s useful information to have when you come back to the firm. It can’t help but improve the relationship,” he says.
And it helped him develop a skill set he can apply with other clients.
For Auger, an enhanced skill set gained through a secondment can only strengthen a young lawyer’s knowledge of exactly what a client needs. And that, he says, “can grow the relationship or build a relationship that was not there before. The young lawyer will have a taste of what it would be like on the other side, what it will be like to be inside the corporation.”
Jaar agrees a successful secondment can create personal links and a durable relationship between the seconded lawyer and an in-house legal department. “The real benefit for an outside law firm is to have an insider who is going to know what is important to the client . . . and identify needs and make a bid for future developments.”
Those skills can be particularly important during tough economic times, but it seems the 2008 global economic shift has had minimal effect on the secondment process itself, say those interviewed for this article. “I cannot say that I’ve perceived any change,” Auger says. “When we see a request for a secondment, it’s usually linked to a specific reason.”
While Desjardins suggests firms send their best lawyers to their clients for free, Jaar disagrees. He says such an approach devalues the work of lawyers generally. “Law firms are intelligent,” says Jaar. “The money they’re not making on the secondment, they’re going to make up elsewhere.”
Jaar adds the economic downturn has seen hungry young lawyers offering their services for free to clients in return for the possibility of a job. That, he says, is a threat to the secondment business, adding that if firms won’t play ball with clients, those clients will look elsewhere in order to manage their budgets. Indeed, Jaar says, he has seen companies use secondments as ongoing strategy to fill positions instead of hiring new counsel. “Many legal departments need new staff but can’t hire more staff. It’s an artificial way to meet that goal.”
To meet that ongoing need means firms must provide that value in placing the right person. Johnson explains a client’s needs for a secondment vary due to circumstances. In some cases, an articling student can handle a workload while in others, the client will need counsel at a mid-to-senior associate level. “Secondments can fill a lot of different needs for clients. In some cases, it makes sense to send an articling student. In other cases, the client may be looking [to cover] in-house counsel going on leave. In that case, the year of call of the lawyer will correlate with the need.” Whatever the need, however, he says, “the intent is to build strong bonds between the firm and the client.”
Auger, though, says the first thing to be determined when the file lands on his desk is what specific tasks the seconded lawyer will be asked to do. “Is it more litigation or corporate? Is it more labour? Is it the two years of experience lawyer; is it 15 years? What are the expectations of the client? It has to be a win-win situation for all the parties involved. Sometimes we cannot say ‘yes.’ There is a cost involved for the firm.”
Those costs include having the lawyer to be seconded transfer his or her caseload to another associate. That involves a learning curve and associated costs, says Auger, adding the firm must be selective in how it decides on secondments due to impacts on the firm of being without a given number of lawyers at any time. “We’re not in the business of secondment,” Auger says. “We’re not in the rent-a-lawyer business. It’s a service.”
From the firm’s perspective, there is also a question of whether the short-term financial sacrifice resulting from the secondment is going to provide long-term client-firm value. Jaar says it can be the case, but only if the lawyer returning to his or her firm has the ear of the decision-makers. In some cases, he says, it’s a writeoff used to cement a relationship while the client gets the expertise. “It’s a brilliant strategy by the in-house community.”
Jim Reid, an adjunct professor at Osgoode Hall Law School, doesn’t discount economic factors, but says secondments are generally based more on need. Some firms and clients may even begin to institutionalize secondments as part of cementing the firm-client relationship. “It’s relationship-driven and not economic climate-driven,” says Reid.
Auger says many secondments in Quebec are a result of female in-house counsel going on year-long maternity leaves. Or, says Johnson, the lawyer could be covering for an in-house counsel taking off to go on leave. In that case, he says, the choice of the seconded lawyer will have to correlate with the experience of the lawyer who is temporarily leaving. Additionally, for the client, there is also the chance to examine a lawyer’s performance and suitability for potential positions within the company’s in-house legal department.
From the lawyer’s perspective, when returning to the firm, he or she becomes the client’s trusted point of contact. Such a position empowers that associate to become a significant player in his or her firm’s corporate culture.
Secondment is also something law societies recommend for articling students in cases where a student cannot receive experience in certain fields within a firm. But both client and firm will only get out what they put into a secondment. And that’s where expectation management comes in.
“What I found is that when you do set all that out and manage peoples’ expectations beforehand, the transition can be seamless,” says Johnson. “We are in the relationship business. You want to work with people you have a level of comfort with. There is always a period of developing that trust, and once you get there, you want to enhance and maintain it.”