What is the Best Structure for your In House Legal Department?

We work closely with legal departments across a wide range of industries and have a first-hand view of the different ways that in house legal departments are structured. If you are experiencing challenges growing your legal department and have difficulty retaining top legal talent, you should consider your legal department structure.

A flat organization or layered?

Some of our clients favor a flat organization in which the General Counsel sits at the top and has a number of lawyers who, regardless of experience level or expertise, are all peers and who each report directly to the General Counsel. In such cases it is not uncommon for the lawyers to each have similar titles such as “Corporate Counsel” or “Associate Counsel”. This structure tends to work best in smaller legal departments where the General Counsel has the time to meaningfully manage each lawyer on the team. It also is a structure that makes sense when the lawyers reporting to the General Counsel do not have an interest in managing others. One General Counsel expressed the view that having a flat organization eliminates competition among lawyers – presumably because there is no upward path and they are not vying for promotions. Having a direct line of report into the General Counsel is important to some lawyers as they may perceive that they have access to the top decision maker in the legal department. Ideally, if the General Counsel is oriented toward teaching and mentoring, the flat structure may be beneficial to lawyers who want to secure skills and knowledge that they might not receive in a layered legal department.

We have also seen the flat organization benefit those who want to be “all in”. They enjoy the variety of a small, efficiently run legal team. Although more junior attorneys may not be expertly skilled in all legal disciplines, they are building their General Counsel portfolio by being entrusted with a wide range of matters.

Other General Counsels prefer a layered structure in which the General Counsel manages from the top of the legal organization. The reporting structure below the General Counsel can take a number of forms. For example, a Deputy General Counsel may report to the General Counsel and in turn have a number of his or her own direct reports. Alternatively, we have clients where the General Counsel has multiple direct reports who each carry the title “Assistant General Counsel”.  Those attorneys in turn may each have direct reports with titles such as “Associate General Counsel” and those attorneys may have direct reports with titles like “Corporate Counsel”.  The point here is that there is a layered structure that affords growth opportunities and a path forward within the legal department. Not surprisingly, General Counsels report that the layered structure is also an effective tool for attracting top legal talent. We see this first hand in our interactions with the rising stars in the legal community.  The best lawyers want personal and professional growth. The opportunity to rise within a legal department and to develop people management skills are very important motivators – they are truly factors of attraction.

The layered law department structure also has a very real second benefit: it not only helps attract “A” list lawyers, it helps retain them. If there are true advancement opportunities and growth opportunities in your law department, lawyers are far more likely to remain with your organization. We are often asked by lawyer candidates what growth opportunities exist within our clients’ legal departments. It is front of mind and often equally as important as compensation. Lawyers who are on a path to the General Counsel role know that they need people management skills and the law departments that offer such opportunities may have a distinct advantage over those that do not.

Some may say that they do not want to train their competition and that providing growth opportunities results in lawyers developing skills and then leaving the company for other opportunities. The enlightened view expressed by a number of General Counsels that we know and work with is that talented people who aspire to General Counsel roles should be embraced, nurtured and yes, assisted in that endeavor. There is a recognition that such people will make significant contributions while they are employed in your legal department and that there is great benefit for everyone concerned in helping them advance in their careers. As one General Counsel explained, you need to be comfortable knowing that your top performers may leave. In fact, this General Counsel supports members of his team when they are seeking top roles elsewhere and they know he will serve as a strong reference.  If you have that mindset, it reflects tremendous confidence in your law department, your resiliency, and the resiliency of your law department.

Both structures can work as tools of attraction and tools of retention. The key is providing meaningful personal and professional growth opportunities for the lawyers on your team.  That in turn builds the reputation of your law department as a training ground for great lawyers. Now that is a powerful means to attract top talent. In either organizational structure, know what you have to offer, what type of legal professional will thrive in your legal framework and recruit the very best legal talent.

Feel free to contact us directly at PLSG: Contact Us