Outsourcing is a common practice across industries in the current economy. Legal services, including those of representation, are no exception. The types of services outsourced also now commonly extends well beyond traditional document review projects. Lawyers choosing to outsource any part of the representation must be careful in who they select to provide the services and how that work is structured. Similarly, non-lawyers charged with vendor selection need to understand the ethical obligations to fully understand the costs involved and the required interactions with outside counsel.
Understanding the duties is the easiest way to ensure that ethical problems and unexpected costs can be avoided. Here are five questions that decision makers should ask when selecting a vendor or a location for any project:
- How are Conflicts Monitored?
The outsourced services can be performed by lawyers or non-lawyers depending on the type of work performed. Lawyers choosing to outsource must comply with Rules 5.1 and 5.3 to make reasonable efforts to ensure the performance complies with the applicable state enactments of the Rules of Professional Conduct. Compliance with such rules includes those governing conflicts and waivers. Here are a few questions to ask the prospective provider to determine whether the conflicts duties are met:
- Is there a standard conflicts protocol?
- How are conflict checks performed with candidates?
- Do you have a protocol for updating conflicts checks?
- Can conflicts be waived? If so, what is your protocol?
- Can you take additional steps for my particular client/project/etc?
- What steps are taken if a conflict is discovered mid-project?
- How are conflicts monitored amongst the project management team?
- What Procedures are in Place to Protect Confidentiality?
Steps must also be taken to ensure that the client’s information is protected in accordance with Rule 1.6 at all times. IT professionals or technology vendors should be consulted with to ensure that all electronic information is properly transferred, protected, and backed up while the outside provider is performing the necessary services. Some questions to contemplate during this phase include:
- What security measures are in place to protect dissemination of the information outside of those working on the project?
- Is there segregation of workspaces?
- Has any additional certifications or insurance been obtained to protect the technological obligations? For example, is the provider Safe Harbor certified or does it have Cyber Insurance?
- Have there ever been any leaks or instances of candidates improperly disclosing information? How did the organization address such situations?
- Are there security systems in place like electronic access cards or video cameras? Is there a reporting function from such systems to investigate issues if necessary?
- Are there any measures in place to prevent copying or downloading of confidential information from the work stations?
- How does the organization dispose of confidential information after the project is completed?
- How can Counsel Supervise the Outsourced Services?
Counsel must also have protocols in place to oversee or supervise the services which are outsourced. The degree of necessary supervision can vary dramatically depending on the nature of work to be performed. Adequate supervision by counsel does not necessarily require proximity to the location of services being performed. Consider the following when making any provider selection or establishing the logistics for any project:
- Does the vendor routinely perform reference checks of its employees?
- Are criminal background checks performed? How can this information be properly disclosed to counsel without creating privacy issues?
- What are the hiring practices of the organization? How does it ensure that candidates are properly screened and of the right fit for the particular project?
- What communication protocols are standard to keep counsel informed of issues, performance, and questions?
- Can additional steps or modifications to the standard protocol be implemented to address specific needs on a particular project?
- What training is required for candidates and can additional training be added upon request?
- Who is primary contact if there is a performance, attendance, or behavioral issue with the candidate?
- Can additional staffing or management support be provided if needs were to change once the project is underway?
- Is there an opportunity to tour the site and meet the management team?
- What Precautions Can be Taken If Work is Sent Outside the US?
Offshoring is increasingly popular as companies push for results at lower costs. However, there is a bigger picture of cost to consider when assessing the overall price tag of any outsourced work. In fact, lawyers should be particularly hesitant in sending any legal services offshore because it may not be possible to fulfill all of your ethical obligations. See ABA Formal Opinion 08-451 and comments 6 and 7 to Rule 1.1. The following questions must be considered if contemplating sending any legal work associated with US matters outside of the country:
- Are there any additional costs that must be incurred? For example, licensing, taxes, or travel costs to establish or supervise the project. Is it possible to obtain an estimate of these costs?
- Is the legal education system training the lawyers comparable to the US?
- Does the professional regulatory system in that country instill comparable core ethical principles similar to the US legal system?
- Is there a disciplinary enforcement system policing the lawyers? How does the vendor ensure that candidates working on the project are in good standing?
- If the training and discipline is inadequate in the country, what steps can be taken for counsel to supervise the particular project? Can that be realistically achieved and what additional costs will be necessary as part of such supervision?
- Is there a risk of seizure of personal property or information in the judicial or administrative system in the country notwithstanding claims of client confidentiality?
- What is the risk of loss of client information or disruption of the project in the event a dispute arises between the vendor and counsel?
- Will sending the project to this particular country create any contractual or public relations problems for the client?
- Do the time zone variances make it impossible or impractical for counsel to oversee or properly supervise the project?
- Are there lower cost alternatives in the US that can achieve the same result at a comparable overall price?
- What Client Communication and Consent Is Required?
All 50 states have some variation in their enactment of the Model Rules of Professional Conduct. The interpretation and application of such state rules can create additional variations. Thus, lawyers and those other decision makers should understand the requirements of the particular rules of the state or the governing law of the underlying fee agreement. Some states permit variation from minimum requirements by contract while others do not. Clients may always impose additional requirements in their outside counsel guidelines or engagement letters that go above and beyond the specified minimums for notice and consent. The only way to understand or enforce the requirements for notice and consent in any particular situation is to evaluate the specifics of the agreement and the legal requirements.
Creatively outsourcing parts of the representation can help keep costs down while staying competitive in the current market. Understand the options and the obligations to guide the client through the process or to better protect your rights as a client. Time and money are always at a premium in any representation. The right relationships can be invaluable to achieving even the most challenging deadlines. Companies like Tower Legal Solutions are fully able to establish customized protocols for any outsourced legal work to help meet the ethical obligations while avoiding unexpected costs.
ABOUT TOWER AND THE AUTHOR
TOWER LEGAL SOLUTIONS AND TOWER CONSULTING SERVICES HAVE SPECIALIZED KNOWLEDGE AND EXPERTISE THAT HAS PROVEN TO HELP LAW FIRMS AND CORPORATIONS REDUCE LEGAL SPEND WHILE MEETING CHALLENGING DEADLINES. TOWER HAS A NATIONAL PRESENCE WITH OFFICES IN NEW YORK, WASHINGTON D.C., CHARLOTTE, DALLAS, MINNEAPOLIS, AND LOS ANGELES. KATHLEEN IS AN EXPERIENCED ATTORNEY LICENSED TO PRACTICE IN MINNESOTA AND KANSAS. SHE IS CURRENTLY THE MANAGING DIRECTOR OF THE MINNEAPOLIS OFFICE OF TOWER.
Learn more about Tower Legal Solutions: www.towerls.com