Private Practice vs In-House
As a specialist legal search team that covers both law firm and in-house mandates, we have candidates approach us looking to move in-house on a daily basis. The biggest misconception around moving to work as an in-house lawyer is that the only difference is that the hours will be less and you can enjoy a healthier "work-life balance", a phrase we hear with increasing regularity. Whilst this can often be the case, there are numerous other differences which should be critical when planning your next career move.
It is worth noting that the below comparisons are being drawn between leading international law firms or businesses as these make up the bulk of our clients. Both opportunities have their own benefits and each individual will have their own priorities and preferences when seeking a new position.
STATURE WITHIN THE BUSINESS:
Law Firm: Lawyers within a law firm are the lifeblood of the business. Fee earning lawyers are what keeps the lights on and doors open for business and as such fee earners are treated very favorably. Usually you will be working in a glamorous office, have all expenses covered, access to any equipment required, paralegals, libraries and even an in-house professional support lawyer to keep you up to date on rule changes, regulations or any other interesting developments within your specialization.
In-House: In any type of business, whether it's a financial institution, MNC or listed company, you are essentially now a cost to the business rather than a revenue generator. In some businesses you may retain the glamorous office and in a good business your department will be seen as a business partner and often work closely with the CEO. However, you will no longer be the lifeblood of the business and as a cost to the business will usually have access to less resources than you were used to in a law firm. As a senior-lawyer you may have an assistant but beyond that you will be expected to work efficiently and keep costs within a budget.
TYPE OF WORK:
Law Firm: Within a law firm you will be specializing in your chosen area whether that is litigation, banking, corporate or any of the other areas of law your firm covers. You will have interaction with other specialist areas but ultimately if you decide to switch teams you can expect to have your recognized PQE and salary cut accordingly. The later you leave this switch the more difficult it will be to achieve or justify.
In-House: Unless you are at a major business with specialist legal teams (such as a large investment bank) then you will likely have to wear many hats. You may have been a capital markets lawyer at your law firm but you will have to do more than that in your in-house role. It is likely you will be involved in all aspects of the legal dealings within a business and often across jurisdictions you are not experienced or qualified in. You will usually be able to instruct outside counsel (within budget) for specialist matters but you will definitely be working on a broader basis. Initially this may sound daunting but ultimately it will keep your role interesting and help you develop skills across different areas. You will need to move away from treating every hour as a "billable" hour and learn to spend time in meetings with other stakeholders in the business to achieve desired business outcomes. At the more junior end you may also have to get used to carrying out tasks personally you have been used to support on such as printing, scanning or arranging appointments.
Law Firm: The ultimate goal for any associate hoping to stay in private practice is to become a Partner. To reach this goal at your current firm or to become a Partner elsewhere we find the general benchmark (in Hong Kong) to be a book of business worth around US$1 million annually. Generally speaking it doesn't matter if there is a space within the firm or not; if you can generate this level of billings through your own network or connections then a law firm will take a chance on making you a partner and supporting you with what you need to further grow the practice. This means you can be promoted quickly if you have a strong network or business development skills.
In-House: General Counsel is the end-goal for those wishing to reach the top within a business from a legal perspective. However, the route to reaching General Counsel is much more complex and uncertain than Partnership. This can often come down to timing and you have less control over this promotion as generally speaking you will not be responsible for generating revenue. Instead you will be judged on factors which are more subjective such as internal relationships, breadth and number of years experience within business and your overall contribution to the business not just from a legal perspective but also all other aspects. As General Counsel you would genuinely be a senior business figure rather than just carrying out legal work. This promotion can also be outwith your control as even if you have earned it, there needs to be a space within the business for it to happen. There may be regional General Counsel positions in a larger business but there will nearly always be only one overall General Counsel.
REMUNERATION / WORK-LIFE BALANCE:
Law Firm: The remuneration within a law firm is the biggest reason we hear of lawyers staying within a law firm. The long hours and intensive work-style are remunerated very well and a lawyer with just 6 years PQE can be paid as high as around HK$125k per month in the best case scenario. The annual raises in most firms are fairly substantial and in most cases this continues steadily as the PQE tallies up. In most law firms and particularly the US law firms you will be expected to work whatever hours are required in return for this.
In-House: Within an In-House environment the remuneration is still very healthy but typically speaking will not rise as sharply as that of a law firms. With this in mind we would always recommend lawyers try to get up to around HK$120k per month within their law firm before making the move In-House. The reason for this is that you will achieve this much quicker within private practice than is possible in-house and usually in-house positions will not ask you to take huge pay cuts at this stage. It is also important as there are substantially less roles available in-house above this figure and usually you will be competing against candidates with established in-house experience for more senior positions. We often have candidates who have reached the HK$150k+ per month mark seeking to move in-house and having to consider taking huge pay cuts to make it happen.
Work-life balance is usually much more achievable within an in-house environment and you can be expected to finish work between 6-8pm, although you may have to take work home or have calls with peers in other locations during the evenings on occasion. Working weekends is rare within most businesses and not standard practice. Author: Robert McLean, Managing Partner email@example.com