Being reliant on external law firms often has its drawbacks

Typically, as businesses develop, the day-to-day legal responsibilities fall to the CFO or CEO. For legal work that is business critical, or perhaps beyond the expertise of anyone internally, you are then reliant on external law firms. This often has its drawbacks, which, if your business is in this position, you may well have experienced. Much like the building firm who would prefer to convert a loft, than put up a shelf, many law firms are not interested in irregular, smaller pieces of legal work from SMEs. We know that all too often, businesses that outsource their legal work to law firms, find themselves offloaded onto a junior lawyer (sometimes a different one each time) who does not fully understand the brief, hasn’t the experience of business to represent their interests effectively or who fails to offer practical advice that takes into account the business’s appetite for risk.

We also know how frustrating and time consuming it is for the CEO/CFO to have to explain their situation repeatedly to different lawyers and to be taken away from their core role when they ought to be devoting their energies and expertise into growing their fledgling business. And if your business is growing rapidly, your legal needs inevitably increase, costs spiral and you’re faced with legal fees that you hadn’t accounted for. This can be quite destabilising for less-established businesses trying to get to grips with their finances.

As your business expands, the principal difficulty is knowing what resource to allocate that will be sufficient to deal with the legal needs of a company in flux. You may consider employing an in-house lawyer or Contracts Manager to support you but are unsure of the difference between them. Perhaps you think you can’t occupy one person full time or you just may not feel you can justify another head count at your current stage of growth. There is also the complication of this being unchartered waters. If you’ve never employed an in-house lawyer before, it is tricky to identify clearly what skills and experience you require, or for that matter what work needs to be done. A company’s legal requirements vary enormously depending on size and the nature of the business and you may be unaware of all the legal or compliance issues that you ought to be addressing.

The beauty of the TLD model is that we offer short and long term solutions for growing businesses. We carry out legal audits for our clients to make it clear what work needs to be undertaken and therefore what legal resource is required.

Our Legal Audit

When auditing your business, we would address the following questions:

• What “legal services” have you used in the last six months?
• What is coming up in the future that requires legal support?
• What areas of the business would really benefit from some legal support? What are the areas that have been neglected, that are currently “muddling” through unsupported and meaning your business is not compliant?
• How has the business changed and how has this affected the basic legal framework of contracts? Does the change make your contracts no longer valid? Have you started selling a new product line for example?
• If there is a better way for your business to deal with its contractual churn? Can technology be employed? Does a system for contract generation, amendment, signing, storing, filing and renewal need to be set up?
• Do your staff require training? Do they understand the legal implications of the work they do and that correspondence over company email may well legally bind the business? Do your sales force or those who negotiate contracts know which are the terms in your standard t&cs that cannot be amended?

The audit will give you invaluable insight into the legal requirements and considerations of a business of your size and situation, giving you the opportunity to make a more informed decision about your resourcing requirements. We have vast experience supporting companies of all sizes and stages of growth and we know there is no such thing as a one-size-fits-all solution.

The Next Step

We can advise on what type of person you need to support your company and help you find the right fit for your business and pocket. More often than not, one of our Client Legal Directors will be able to meet your needs. We make a concerted effort to make sure we get the right lawyer for your business in terms of cultural fit as well as expertise and, if you don’t think the fit is quite right, we deal with it straight away.

Our lawyers are embedded as part of your team to oversee all your legal affairs on a flexible or part-time basis. Working from within your company, focussed on your business needs, we not only look at your contracts but all aspects of your organisation from compliance to GDPR, HR to your property, your suppliers to your insurance and everything in between. In a recent client listening exercise, we were told that often team members don’t even realise our lawyers are an external resource – they are really working from within your organisation.

Because our lawyers work flexibly, they can give you the right level of support for your business, working for just a couple of days a month if required and scaling up should your legal needs increase. This helps you manage your budget and stops you paying for an idle resource, whilst giving you the benefit of someone who knows your business intimately and will represent your business needs in every interaction.

Sometimes, the legal audit will show that a TLD lawyer is not the long-term solution for your business. Businesses can simply need support through periods of change or particular projects before they are in a position to recruit a full-time, permanent employee. This was the case with Nichols plc, where one of our lawyers joined the company at a time of transition. She carried out the day-to-day legal work, reviewed contracts and looked at the company’s compliance and then went on to devise a long-term work plan and help recruit a permanent in-house lawyer. Such is the flexibility that TLD affords its clients, she was also available to carry out a full handover of work.

We have also worked with businesses where one of our lawyers has managed the company’s legal team to oversee all legal work and supervise junior resources in work that doesn’t require a senior lawyer. Our approach is truly flexible – you can bring us in to cover periods of maternity/parental leave, to add weight to your current in-house team and/or as a regular legal resource.

If your business is growing and you are unsure what legal support is right for you now, please do get in touch. We can give you more information about our legal audit or simply chat about some of the legal issues and considerations that may impact a business like yours.

The Legal Director