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Transparency In Troubled Times: Communication for Law-Firm Leaders

By Margaret Lockhart

It seems that every day another law firm announces layoffs. Associates, paralegals, and staff are being furloughed. Firms withdraw offers of employment, defer start-dates for new associates, and cancel summer associate programs. Partner compensation is being reduced. Consultants advise firms to take advantage of the opportunity to “cull” unproductive attorneys and to dismantle struggling practice groups. Those remaining behind may be competing for work. Anxiety abounds.

Law-firm leaders are understandably focused on surviving the economic downturn. Many are looking for ways to adapt the firm’s practices to capitalize on new opportunities. They are working closely with struggling clients and revising budgets to account for requests for reductions in fees and longer collection cycles. Many more are closely monitoring timekeeping, billings, and collections, which may lead to further anxiety among attorneys and paraprofessionals. Staff too feel the tension. They have their own worries about job and financial security. And they know when attorneys are not busy.

Some law-firm leaders avoid talking about these issues because they don’t want to worry attorneys and staff about firm finances. Others are so focused on finding solutions that they don’t think about how the downturn is affecting individuals within the firm. Still others, particularly in firms less impacted by the downturn, feel no need to talk about something that only marginally affects the firm.

Whatever their reasons or motivations, these leaders are not helping their firms. Indeed, their silence may lead to misinformation, rumors, and even greater anxiety. High levels of organizational anxiety reduce productivity and efficiency and may affect the quality of the firm’s work. And the firm may risk losing attorneys or staff it wants to keep.

Whether the firm is large or small, established or fledgling, full-service or boutique, law-firm leaders must communicate with stakeholders in troubled times. Leaders at all levels—managing partners, practice group leaders, and administrative supervisors—must share information. And they must be available and willing to listen to people’s concerns.

Share the News, Both Good and Bad
In times of crisis, attorneys and staff may assume that no news is bad news. They know that other firms are downsizing, and they know when executive committees or other management teams are meeting behind closed doors. The limited information provided may take on greater significance. And individuals may fill in the blanks with misinformation or erroneous assumptions.

If firm leaders are not talking to people, attorneys and staff are certainly talking to each other. In this environment, it doesn’t take long for potentially destructive rumors to spread. Leaders who are not listening may not even be aware the rumors until they have created a crisis.

If your firm, office, or practice group is facing unusual challenges, tell your attorneys and staff about them and discuss what you are doing to confront them. Ask people what they are hearing, and use the opportunity to dispel rumors. Invite employees at all levels to ask questions and to offer suggestions. A frank discussion with stakeholders may reveal novel solutions. At the very least, it will give attorneys and staff a forum to express their concerns, and it may dampen, if not derail, the rumor mill.

It is equally important to reinforce the firm’s strengths and to celebrate the firm’s successes. Look for—and invite others to look for—opportunities the downturn might present. Encourage attorneys to reach out to clients, not only to learn about your clients’ problems and discuss solutions, but also to allay any client concerns about the firm’s capacity or viability. Remember, they need you too.

Do Unto Others
Imagine that a longstanding and trusted client terminated your firm or filed bankruptcy without any advance notice that it was struggling. You would likely feel confused, betrayed, or angry. But just as you expect clients to keep you informed, your attorneys and staff want to be informed—not ambushed—with bad news. Consider what you would want to know if you were in their shoes. And trust that they will be able to handle the news, good or bad. If you do, they are more likely to trust your decisions.

Be Visible
When attorneys and staff are anxious, it is crucial that law-firm leaders be visible and approachable. As a leader, you should communicate outside of formal meetings and make time for one-on-one or small-group discussions. You should also respond quickly to rumors and clarify inaccurate statements.

Some leaders resist high internal visibility in the hopes of avoiding a barrage of complaints from employees. But as General Colin Powell said, “the day soldiers stop bringing you their problems is the day you have stopped leading them.”

Don’t Make Promises You Can’t Keep
Leaders may think that assurances will reduce anxiety and improve morale. That may be true if the assurances are genuine and well-founded. But false assurances are likely to undermine trust and cause resentment. While it is important for leaders to stay positive, it is more important to be honest, even when it means admitting that you don’t know what is going to happen.

Avoid Being Defensive
One of the downsides of open communication is that attorneys and staff may question, challenge, or criticize firm leadership’s plans or decisions. You must be prepared to accept questions and respond to good-faith criticism in a manner that doesn’t shut down the discussion. Keep in mind that the questioners did not participate in the hours of deliberation when the suggestions they offer were considered and rejected. Be patient.  And remember that if you simply decide and announce without providing opportunities for questions and discussion, the questions, comments, and criticism will be expressed behind closed doors when you have no opportunity to respond or explain.

Maintain Communication with Clients
It is tempting, when workloads have dropped and clients are demanding reduced rates or alternative billing arrangements, to focus solely on the firm’s economic interests. But most clients are asking for concessions because they too are suffering from the economic downturn. Many in-house law departments are being downsized, and the remaining attorneys are being asked to do more with less. And small businesses or individuals simply may not have the resources to finance transactions or litigation.

Open and frank communication with clients is paramount in times of crisis. Leaders who value their client relationships should be asking clients how things are going and what they can do to help. And they should respond honestly to the client’s questions about the firm’s strength, viability, and capacity.

Candid discussions with clients may lead to solutions that benefit both the firm and the client. For example, many law firms have excess capacity, while in-house legal departments are short-staffed and are restricted from hiring. A law firm that does not want to lay off idle attorneys could lend an attorney to a client for a period of time, giving the attorney additional valuable experience and the client much-needed assistance. When the economy recovers, the firm will likely have a stronger relationship with both the attorney and the client.

It is not an easy time to be a law-firm leader. You may feel that you face insurmountable challenges. The knowledge that others rely on your judgment and decisions for their livelihood can be overwhelming. But you do yourself and your firm a disservice by forging ahead in silence, trying mightily to do the right thing. By sharing and soliciting information and feedback, you share the burden.

Margaret Lockhart is with Cooper & Walinski, LPA.

This article appears in the forthcoming Summer 2009 issue of the Woman Advocate, the newsletter of the Woman Advocate Committee.

  • July 8, 2009 – This is the type of logical, level-headed advice I would expect from Margaret. Well done and useful: thanks for the insight.

  • September 11, 2009 – Of course there is a conflict. A law firm that supplies a clerk to the court and pays the clerk, has a relationship with the court and the clerk that will influence the actions of the court and the clerk. Judges are human and struggle to be fair and unbiased under the best of circumstances. I would prefer not to litigate against a firm that has a history of paying law clerks and ingratiating themselves to the court with their financial support. Lawyers and firms that do not pay to play by loaning employees will not have the same presence or appreciation as the lawyers who finance the law clerks and, without doubt, mentor the clerks and guide them in their legal thinking.

    It is hard to believe that lawyers who try cases could actually contend that such a practice is benign. Perhaps there canb be levels of benefactors with the big players identifying themselves as QC's (Quite Clever), smaller donors as LC' (Less Clever) and everyone else as NW's (Not Worthy). To be fair, if the court offered levels of sponsorship like the Metroplitan Museum or the Chamber of Commerce, clients could hire lawyers who are at the Patron or Mega Patron level or ask the court to provide a list of equivalents so they can select firms that are viewed with the same sense of appreciation and thus ensure a fair and exciting trial.

  • September 11, 2009 - MA scrapped this program. They will NOT be using deferred associates as law clerks.


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