Expanding career opportunities for HR specialists with solicitorsí practices

HR specialists are now able to become salaried or full equity partners at solicitorsí practices. This marks a break with tradition as previously only fully qualified solicitors could be appointed as partners. However, as of 31 March, up to 25% of a firmís partners can be non-lawyers, thus creating ëlegal disciplinary practicesí and marking the first phase of deregulation under the Legal Services Act.

ìThese new rules open up excellent opportunities for HR specialists with a specialist background in the legal sector. And it looks to be a win-win situation. Individuals will benefit from enhanced recognition and possibly improved remuneration opportunities, while the new rules should help law firms attract top quality people,î said Giles Murphy, head of Assurance & Business Services at Smith & Williamson.

ìWe could see a lot of forward-thinking law firms appointing their head of HR as partners in the next few months. I believe these firms will potentially gain an advantage over their competitors. These firms will undoubtedly be best placed for the move towards multi-disciplinary practices in 2011-12,î he continued.

Murphy advises that anyone who is considering accepting an offer of promotion to partner status with a law firm should check out any potential liabilities facing the firm and take care to ensure that the incentives sufficiently outweigh any additional risks they may face. If a practice has not yet transferred to LLP (limited liability partnership) status, each individual partner remains jointly and severally responsible for any claims against the practice meaning that their personal assets are not protected in the event of any successful claims against the practice.

ìIndividuals should recognise that in the current economic downturn there may be greater propensity for claims than at other times, which arguably makes LLP status more important than in a stronger economic climate. I would also urge any would-be partner to consider the partnership agreement and profit sharing arrangements before signing up to ensure that acceptable arrangements are in place.î

The Legal Services Act paves the way for a major change in the legal sector. The rules which took effect from the end of March 2009 represent the first stage of deregulation and introduce ëlegal disciplinary practicesí (whereby 25% of the firmís partners can be non-lawyers). The second phase enables law firms to be licensed as ëalternative business structuresí and is expected to come in to force in 2011-12. Under these structures, a high street firm of solicitors might merge with, for example, a local firm of accountants or surveyors, creating service synergies and increasing competition. This phase of the Act will also permit investment from external shareholders or stakeholders, potentially enabling law firms to seek a public listing, either on AIM or the full market.