Are you ready for an in-house lawyer?

It’s an important question for many companies to ask themselves once they start achieving substantial growth and scale in their business.

It’s tempting to see all the money spent on contract review, litigation and other miscellaneous legal work as something that can easily be shifted in-house.

While there are certainly significant benefits to having an in-house lawyer, if it’s that first hire it’s important to consider how you are going to go about filling the role and what you’re looking for.

Having worked as an in-house lawyer and also currently being in a position where I provide some level of in-house services to clients I certainly have some views on how you should approach this question.

Firstly, don’t be tempted to go for the cheap junior.

I have seen several companies look to appoint junior lawyers to be their first in-house hire. To my mind this is a mistake.

While a good junior lawyer will be able to provide assistance in some areas of your in-house function, they won’t have the necessary experience to provide strategic and commercial advice which will be of benefit to your business.

Further, they may also not have sufficient experience to push back against ideas within the business that carry significant legal risk. Remember, you should be hiring a lawyer not just for their review of your commercial arrangements but to act as a risk mitigator in your business.

Second, consider alternatives.

You may just be getting legal services from traditional law firms that are charging you a high hourly rate for all the work they do. While this is sometimes the only option, for example in litigation, often there are alternative billing methods that make it easier for you to smooth out your legal spend.

Challenge the law firm providing you services to offer alternatives. If they are unwilling to do so consider one of a number of alternative providers in the market.

Disruption is a big word across several industries at the moment and law firms are being disrupted just as much as other industries. There are now several smaller firms offering alternative options for companies in billing practices and how they engage with your business. (Full disclosure: this best describes my current practice and is how I work with most of my clients.)

If you have been through the above two steps and still think you need to appoint an in-house lawyer then, like any senior employee appointment, take the time to make the right decision.

Remember, you will not get a quality lawyer cheaply and if you pay peanuts you will get monkeys.

Consider engaging a good quality legal recruiter to help you make the appointment.

Legal knowledge is obviously a given but also look for the right commercial fit for your business.

And lastly, once you have made the appointment, don’t waste it.

A quality lawyer with a sound commercial approach can be highly valuable to your executive team.

If you involve them with your business throughout the decision making process it will help identify and catch issues early. You will get much more value from an in-house lawyer who can act proactively rather than reactively.