According to articles published in Law.Com International and the Law Society Gazette, growing financial pressures brought on by the COVID-19 pandemic have now seen multiple top 50 UK law firms forced to take measures to weather the storm. Law.Com International articles state that along with Hogan Lovells, Ashurst, Weightmans, DLA Piper and BLM, who recently announced their decision to furlough 170 employees, Linklaters is the latest of the big-name legal brands to lean on government support and put staff on the furlough scheme.
The firm has also taken action to suspend partner profit distribution, defer 50% of its next bonus round pay-out and push back salary reviews by six months. Official statements from representatives of the firm suggest measures have been taken out of caution rather than immediate concern.
However, with the UK economy still stuck in the chokehold of the Covid-19 crisis, the cracks in the system are starting to show. When the world begins to recover from this crisis, the outmoded practices that saw traditional firms forced to furlough staff will be difficult to ignore.
While the last decade has been awash with talk of transformation, and most professional service firms have made the shift, the legal industry has lagged behind.
Prior to the spread of the global pandemic, pressure to evolve was predominantly commercial. With client demands shifting to prioritise cost, efficiency and transparency, revolution was in the air –materialisation, however, would take a complete overhaul of the traditional law firm model.
Predictably, most firms were reticent to reinvent the wheel, preferring to hold off the competition with reputation and prestige. Ironically, the reputation of these top 50 firms is sadly now on the line. Perhaps beforehand, agile law firms and tech-led practices were seen as nothing but playful competition.
Unfortunately, it is these practices who have thrived in the face of economic collapse – not because they were opportunistic, but because they built their business models to reflect the needs of the modern client.
If digitisation and the evolution of culture was an ongoing war that the traditional firm was fighting, Coronavirus was a devastating ambush that would alert leaders once and for all to the inherent problems with the archaic model.
It goes without saying that we could never have predicted that a catastrophe so colossal would threaten the very foundations upon which our industries have been built. That being said, the current climate has certainly shone light on how fortunate we are to have followed the path we did.
When we started 360 Business Law, we did so on the premise of bringing real change to the sector. Operating as a virtual firm with an agile infrastructure would enable us to be agile and responsive to client needs in a fast-moving landscape. It would also allow us to work with a network of highly qualified lawyers on a global scale and serve clients across multiple jurisdictions without increasing fees to cover overheads.
We predict that this crisis will be a catalyst to true sector-wide change as the industry combats the challenges presented in these uncertain times. This revolutionary progression, in both the way law services are provided and consumed, is not only exciting for businesses and end customers, but also for the profession itself. COVID-19 has forced the end of an era and prompted the rise of a new, modern, yet radical transformation of one of the UK economy’s biggest success stories: it’s justice system.