��˾����ҹ����

The Gig Economy has morphed into somewhat of a dirty phrase in recent years. Once hailed as the future of the modern workforce – an era of greater flexibility and empowerment for workers – the industry is now commonly associated with the independent contractors employed by the likes of Uber and Deliveroo.

Yet many of us, perhaps unknowingly, are part of this so-called Gig Economy. According to the , the “gig economy involves the exchange of labour for money between individuals or companies via digital platforms that actively facilitate matching between providers and customers, on a short-term and payment-by-task basis.”

In the UK alone, 4.18m people are self-employed, according to December 2021 statistics from , and many of these people are in 'project' roles with a clear end date lasting for a matter of weeks or months.

Free report: The alternative platform law firms that are changing the way lawyers work

Lawyers look for a better work life balance

Interestingly, the main draw that drives people to work for Uber applies across the majority of industries. A nearly 90% of Uber drivers said “being their own boss” and being able to set their own schedule was a primary reason they opted for the role while 85% said a major reason was a greater work-life balance.

This same exact reason is what’s drawing many lawyers into the Gig Economy. The legal sector is notorious for its long hours and high demands, and while this approach might have flied with previous generations of workers, newer generations are demanding more from their workplaces.

Some 60% of midlevel lawyers said they would consider moving jobs for a better work-life balance, while only 27% said they would leave for more money, according to American Lawyer’s 2021 Midlevel Associates survey.

This shift is partly generational, but the role the pandemic has played in altering priorities relating to work life balance is undeniably fundamental. For one thing, it showed legal professionals at all different stages of their careers that they could technically…albeit on occasions…be home on time for dinner.

Tax troubles: how IR35 impacts contract lawyers

Recent changes to tax laws in the UK have made working on a freelance basis increasingly more challenging for independent lawyers – but that’s not causing them to give up on their dreams of having a better work life balance.

Nothing sends shivers up the spines of independent contractors quite like the IR35. This dreaded tax law, which has underseen a series of amendments in the two decades since coming into place, has recently been revised to include a new set of rules that impact the private sector.

Companies working with freelance contractors now face the possibility of tax liability and in-depth audits for all non-permanent workers, making the appeal of hiring an independent contract lawyer significantly less attractive.

For many, this fundamental change was thought to be a crushing blow to the Gig Economy lawyer – and indeed it may have been for many – but there are a number of platforms that lawyers are flocking to that give them the best of working at a law firm alongside the independence they would get as a contract lawyer.

Revenue-sharing platform law firms

Revenue-sharing platform law firms – otherwise known as virtual, fee-sharing, or consultancy law firms – are quickly making a name for themselves in the legal market for their flexible working style and commission-based model. At one of these firms, a lawyer typically takes home 70% of their total billings, with the remainder going to the firm in exchange for technology, insurance, marketing and admin support.

Read our new report: Rise of the legal consultant

One of the most well-known names is top 100 law firm Keystone Law, which has almost 400 lawyers on its books and is listed on the London Stock Exchange – it also allows legal consultants to keep 75% of their total billings. Another is gunnercooke – also a top 100 firm – which has approximately 300 fee earners and gives consultants back 70% of their billings (this rises up to 90% depending on meeting revenue thresholds).

Darryl Cooke, Co-Founder and Executive Chairman at gunnercooke, says: “We don’t have the bureaucracy, we don’t have the politics, we don’t have the remuneration battles, we don’t have the hourly billing targets, so we take away all the things that people don’t like about big law and give them total freedom. If they don’t want to work Fridays, they don’t work Fridays, if they want to take six weeks off in the summer, they take six weeks off in the summer.”

Another aspect of working at a platform law firm is the opportunity to spend more time with clients. Corporate lawyer Nick Ducker, who has been self-employed at gunnercooke for almost a decade, says:

“The whole model made perfect sense to me, the flexibility around the way you work but more importantly around the way that you interact with your clients.”

Platform law firms also come with the advantage of eliminating the regulatory burden of going solo, says employment lawyer Karen Coleman, who works for Excello Law, which has approximately 130+ lawyers on its books.

“You don’t have to worry about the COLP (Compliance Officer for Legal Practice) and the COFA (Compliance Officer for Finance and Administration) regulations and you get access to all of the compliance support, so you get all the benefits of being in a firm in terms of resources but you don’t get all the negatives in terms of targets and politics,” Coleman said.

However, one of the side effects of working at these firms is that lawyers are almost entirely responsible for bringing in their own business, says Tony Williams, Founder of Jomati Consultants.

“There are no shortage of platforms but the challenge is how many lawyers are there who genuinely have the sort of following and the business development skills to feed themselves. This model relies on a level of self-sufficiency. Fundamentally it’s a hunter-gatherer mentality. Clearly there are people who can do that but whether there are enough who can consistently do that, that will be a challenge.”

Traditional law firms are creating flexible resourcing arms

The flexible resourcing of legal resources is not a new model – it has been around since the turn of the century when Axiom Law and a number of competitors first entered the US market. Now, Axiom has more than 5,800 lawyers globally and a revenue estimated to be upwards of $360m.

“I’ve always viewed Axiom as this escape route from these forced compromises that a lot of lawyers have reluctantly accepted,” said David Pierce, Chief Commercial Officer at Axiom. “As a lawyer you want good work, you want more control and you want to earn a good living, but you still want the living part, you want a balance of things that you care about or draw inspiration from. For a long time, you just haven’t been able to get all of those things at once, so Axiom is a place that optimises for each of those things.”

However, in the last decade or so we’ve seen many well-known traditional law firms set up their own flexible resourcing arms to help manage heavy workloads.

A well-known example is Magic Circle firm Allen & Overy, which established its Peerpoint platform in 2013 and now has roughly 350 consultant lawyers and a UK revenue understood to be upwards of £35m.

“It’s not a one-size fits all model,” said Carolyn Aldous, Managing Director of Peerpoint. “For some lawyers, they will only work on one deal at a time, and when that deal needs to be done they will work it, and when that deal is not on, they will take a break and manage it accordingly. Other people choose to work for six months a year and then take off the next period to pursue whatever their interest is, so we’ve got professional yachtsmen, we’ve got people who are fiction writers, we have art dealers, property renovators, so some people use their law career to effectively fund the other part of their life.”

Another example comes from top 100 law firm, Pinsent Masons, who launched Vario in 2013 and has over 1,000 third-party lawyers who can be deployed for specific client projects.

David Halliwell, partner at Vario, said its flexible workforce enables permanently employed lawyers at Pinsent Masons to focus on higher value client work—and that comes with the additional benefit of having an army of specialist lawyers when the need arises.

“The growth of our flexible lawyer business has gone from strength to strength through the pandemic,” said Halliwell, who attributed this growth to the firm’s investment in legal technology.

Other examples include Linklaters’ Re:Link, Eversheds Sutherland’s Konexo and Bryan Cave Leighton Paisner’s Lawyers on Demand.

Traditional law firms will need to act now to retain future talent

While these alternative models will not be replacing traditional law firms anytime soon, they do pose a significant threat from a talent perspective.

“The market is not big enough yet for traditional firms to be losing sleep over, but where they are most worried at the moment is less on the business side and more on the talent side—they are very worried about losing talent and they have to change things to make life more attractive to retain their lawyers,” said Christopher O’Connor, Director of Solutions at ��˾����ҹ����.

The Gig Economy doesn’t appeal to all lawyers – nor does it suit them – but recent events have reshaped the way lawyers view their roles and themselves. Law firms wanting to attract and retain the best legal talent will need to adapt to these changes by offering greater flexibility around work, encouraging a better work life balance and accommodating lawyers at all different stages of their careers.