Part 2 in our 4-part mini-series, Hazlewoods report upon the vital signs of the UK Legal Market.
Still to come in this mini series: a report on law firm closures and taking the pulse of a Law Society approved benchmarking overview.
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Number of UK “platform” lawyers increases 29% in a year
– crossing the 1,000 lawyer mark
“Gig economy” for lawyers continues to expand with LSE listing of Keystone Law
The number of UK lawyers working for “platform” law firms has increased by 29% to 1,035 in 2018, up from 803 in 2017, shows new research by Hazlewoods, Chartered Accountants and Business Advisers who specialise in the legal profession.
The growth of platform law firms is part of a growing trend for lawyers to work outside of a traditional law firm structure. These new management structures are billed as allowing lawyers to take more control of how they work and to be more entrepreneurial.
Platform law firms offer the option of working ‘flexi-time’, avoiding the long hours culture of the legal profession and allowing the lawyer to retain a higher percentage of the fees they charge.
Lawyers at such firms are self-employed, tend to work remotely and use a back office and other shared IT services such as accounting, IT, marketing and compliance provided by a central hub. Some commentators describe it as part of the gig economy.
The self-employed business model enables lawyers to choose when they work and how much time they spend on marketing versus fee-earning.
Having lawyers working remotely means platform law firms often have fewer overhead costs on physical premises and on-site IT staff for example. These law firms argue the savings mean they can offer clients high- quality services at lower rates than many of their competitors.
Remote working also gives platform law firms the opportunity to expand into underserved niche markets, including many geographical regions without the physical presence of traditional law firms.
Investors are increasingly attracted to the growth opportunities for the platform law firm model. In November 2017, Keystone Law became the first platform firm to list on the London Stock Exchange.
The continued growth of platform law firms reflects the enthusiasm in the legal sector to adapt to new ways of working. It is also perhaps part of a broader trend amongst lawyers to be more entrepreneurial, to strike out on their own. Some because they want to do things their way, some because they feel big law firms involve too much politics and pressure, and others because they feel they are not getting enough out of the fees they earn.
Platform law firms are also tapping into the trend of placing greater importance on the work/life balance across many sectors, not just in law firms.
Remote working enables the sector to attract and retain talented legal practitioners for whom the traditional model may not be the best fit. Without having to commute to a fixed office, it also gives lawyers much more time in which they can focus on fee-earning work.
Up next: how are your peers faring? In Part 3 of our Law Firm Vitals series, we report on law firm closure trends and what they mean for our sector.
Do contact us at Hazlewoods if you would like more information or to talk about any aspect of law firm finance or strategic planning.