The in-house hiring market is very active, as legal departments are furiously trying to fill all levels of jobs from the general counsel on down, according to recruiters at the legal search firm Major, Lindsey & Africa.
Meanwhile, there are more openings than available candidates boasting strong resumes, and what one MLA recruiter called the “perfect storm of lower supply and higher demand” is particularly evident for mid-level roles.
“Everybody seems to be looking for high-quality, mid-level corporate counsel to bolster their legal teams,” said Dimitri Mastrocola, a New York-based partner with MLA’s in-house counsel recruiting practice. “There are only so many of them to go around that are available, and hence the competition for them is intense.”
This hiring frenzy has resulted in top candidates fielding multiple offers and aggressive counteroffers, allowing them to seek compensation and remote work arrangements that would have been unheard of prior to the COVID-19 pandemic.
“If you're a company looking for talent, you have to understand that it’s a candidate’s market and you're going to have to adapt and flex in different ways in order to get the talent you're seeking,” said Heather Fine, a Chicago-based partner with MLA’s in-house counsel recruiting practice.
In response to the highly competitive market, legal departments are having to boost compensation considerably to attract the strongest candidates.
MLA reported late in 2021 that legal departments were increasing compensation packages by 10-20%, a development that came amid a year the firm said was the hottest it had seen for the-house market in more than four decades.
Fine told Legal Dive that companies are often finding themselves in situations where candidates’ compensation expectations are above the ranges they set for the openings.
“Compensation levels have been driving upwards in every position,” Fine said.
Legal departments are also offering signing bonuses to strengthen their offers, including some who offered to pay full 2021 bonuses to new hires who joined late in the year.
Stock options are another tool legal departments at public companies are using to make their offers more competitive in instances where they can’t bump up the cash compensation any further, said Carol Simon, a San Francisco-based partner with MLA’s in-house counsel recruiting practice.
Additionally, private companies are offering long-term incentives in the form of phantom stock, according to MLA’s Global In-House Market Conditions report for the first quarter of 2022.
Law firm competition
Another reason legal departments have had to enhance the financial packages they offer is that law firms are paying ever-more money to both recruit new attorneys and maintain their ranks.
Some law firms now pay experienced associates $400,000 or more, making it difficult for legal departments to keep up when trying to fill low-level and mid-level posts.
“The law firm compensation continues to be pretty staggeringly high, so it does make it harder for an in-house organization to compete financially, at least on the cash side,” Simon said.
“In this market, it's very challenging to recruit a high-quality associate at a law firm to go in-house to take a pay cut,” Mastrocola added.
In light of the compensation dynamics, legal departments are encountering candidates who are increasingly asking for better titles to sweeten their offers.
Simon said this includes attorneys who would normally come in at an associate counsel role asking to start as counsel, and more experienced lawyers seeking to start as vice presidents rather than senior directors or senior counsel.
Beyond possible title upgrades, Fine said legal departments can commit to helping attorneys achieve developmental goals they have, such as gaining experience working on mergers and acquisition matters. Additionally, in-house teams can emphasize the opportunity to work closely with the business, Simon said.
Legal departments are also facing a market in which a high percentage of attorneys want to work remotely in full or in part. Many companies are offering that type of flexibility to junior and mid-level attorneys so they can choose from the strongest candidate pool and more quickly fill positions.
“There are a number of candidates who are saying if there are not remote working arrangements, they're just not interested in the opportunity,” Fine said.
She also said candidates for in-house jobs may be less willing to relocate even if they could have a partial remote working arrangement in their new location. As a result, some of Fine’s clients who previously would have preferred attorneys to be based at company headquarters are now agreeing to arrangements where the lawyers must at least be near another company office or facility.
“Younger employees and those with school-aged children are the most reluctant to return to the office,” according to MLA’s Global In-House Market Conditions report issued in late 2021.
Fine emphasized, though, that most companies still want GCs and other executive-level lawyers to work out of headquarters at least some of the time, but often more.
Positions in highest demand
The MLA recruiters said the most in-demand positions in the market include commercial contracts attorneys and lawyers specializing in securities and governance.
Fine noted the commercial contracts attorneys are always highly sought after because they are needed in companies across industries. As for the securities and governance posts, the flurry of financial activity and IPOs following a slowdown during COVID-19 has generated heightened demand.
“We have placed more securities and governance lawyers in the last year than I think we have in several years combined," Fine said.
Intellectual property counsel are highly sought after by legal teams as well, particularly in the life sciences industry, according to Simon.
There is also high demand for compliance, data privacy and legal operations professionals.
Legal departments are “treating the area of legal operations with a higher degree of respect and understanding that it really does require a lot of time and attention to do well,” Simon said.
Compensation packages for legal operations chiefs are shooting up as well.
Meanwhile, the business sectors where the most hiring activity is taking place include financial services, pharmaceutical and life sciences, biotechnology and digital assets, according to MLA.