Interactive webpages, well-designed
document engines, and efficient office
procedures will enable a firm to profitably provide a valuable legal service to
the underserved “middle class.”
GREG: I’m skeptical about whether it
will make financial sense for firms to
use LLLTs, at least in the near future.
The jury is out on whether LLLTs will be
substantially less costly than recent law
grads. As chair of the WSBA Solo and
Small Practice Section, I know it is not
uncommon for recent graduates to free-
lance for $25/hour. Why hire a “lawyer
lite” when you can just hire a lawyer?
And a paralegal practicing in a firm,
under attorney supervision, can do all
the drafting allowed of a LLLT. Sure, ef-
ficiencies can be achieved by deploying
technology. But value may be captured
from such efficiencies regardless of hav-
ing a LLLT involved. Some simple draft-
ing processes can be mostly automated.
To the extent legal drafting can be au-
tomated, the remaining “touch” might
best be left to an attorney’s discernment.
lowering the cost of legal services, there
will be less value for a firm to capture.
I suspect few small firms will have the
sophistication needed to run a LLLT
practice at a volume high enough to be
worth the effort. (Though if anyone can
do it, Jerry is probably the one.) Certainly price point isn’t the only way for a
business to complete, but if LLLTs aren’t
performing comparable work for less
than a lawyer, the program is not serving its intended purpose.
Finally — as explained in more detail
later — a small slice of a small pie is, well,
small. To the extent LLLTs succeed in
In the balance of this piece, we examine some basics of how a firm might stand
to benefit financially from LLLTs and discuss the merits of various models.
THE ASSOCIATE MODEL
Every lawyer should aspire
to render at least 30 hours of pro bono
Law firms traditionally capture profit
from the margin between labor costs
and the rate billed to clients. On this
familiar model, an associate billed to clients at $150/hour may be compensated
at $50 or $75/hour. Will firms be able to
capture value by selling the hourly services of LLLTs at a markup?
public service per year to those unable
to pay. But when this is not feasible,
a lawyer may discharge the pro bono
responsibility by making a financial
contribution to civil legal aid
organizations serving persons
of limited means.
GREG: First, as noted above, there’s
an open question as to whether LLLTs
will be much lower cost than recent law
graduates. If not, one may as well use a
new associate. But assuming LLLTs will
have a lower price point, that makes
them challenging on the traditional associate billing model. If a LLLT earning
$40/hour is billed out at $80, a firm
captures a modest $40/hour. A solid 40-
hour workweek would render $1,600,
from which a firm would still have to
pay overhead associated with the LLLT.
The law firm would have to achieve extraordinary volume to make this model
Give. Advocate. Volunteer.
A second, deeper issue concerns the
price elasticity of demand in the legal
services industry. In order for LLLTs to
pencil out for firms, such demand needs
to be elastic, meaning that a reduction in
price will increase demand for services.
While that outcome seems intuitive, it
is not simply true by necessity. LLLTs
will bring work into a firm only if there
is a latent market of clients who already
want to purchase services but can’t
stomach the price — the Washington