Outsource some of your legal work to Northern Ireland, mid-sized firms urged

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By Legal Futures

8 March 2011

Belfast: office space from just £14 per sq ft

Mid-sized law firms in England and Wales should consider the opportunities presented by outsourcing parts of their work to Northern Ireland, it was claimed last week.

Norville Connolly, senior vice-president of the Law Society of Northern Ireland, said the province was not just an option for law firms opening a captive to do their own work – as City practices Allen & Overy and Herbert Smith have both recently done – or for legal process outsourcing (LPO) companies to set up operations.

He told the Global LPO Conference in London, organised by Indian LPO specialists KPO Consultants: “There is, I suggest, a further model to be considered by particularly mid-sized firms, and that is to send some sections of their work to local firms in Northern Ireland who can conduct the work at a highly skilled level but at a much reduced charging rate.

“This business model provides you with people of the same background and training, the same skills, the same understanding of issues within the same time zone and with highly developed communication links both in terms of hard core infrastructure and technology.”

The model would be similar to Hogan Lovells’ well-known Mexican Wave programme – where lower-level work is outsourced to regional law firms in England – and Berwin Leighton Paisner’s Managed Legal Service, where the firm takes on a company’s in-house function and outsources some of the work to firms in Kent and Manchester.

Mr Connolly said that one of Northern Ireland’s great strengths as an LPO destination is that it has “a hugely untapped, highly educated, intelligent and motivated crop” of around 600 law graduates a year; however, there are only 148 training places to become a solicitor.

“It is not easy for them to find jobs and therefore there is the availability of a highly intelligent, academically well-trained workforce to tap into,” he said.

He said that a representative of Allen & Overy had indicated “that some of the major attributes [that led the firm to choose Belfast] were that there was a pool of highly educated people who would remain loyal – in other words, they wanted to live and work in Northern Ireland and not move away. Also he said that the work ethic was extremely high”.

As well as the law firms, Citibank has opened a centre of excellence in financial services in Belfast; 70 of the 800 people who work there are in the legal and compliance division.

Mr Connolly pointed out how much cheaper Northern Ireland is to England and Wales, with prime office rents as low as £14 per sq ft in the greater Belfast area and £7 outside it, salary costs 20-40% less than the rest of the UK and Republic of Ireland, while the present High Court Master’s taxation hourly rate is £97 (before the standard 50% mark-up).

There are currently 2,400 practising solicitors in Northern Ireland and around 540 law firms.

It was reported last week that Invest NI, the inward investment body that has provided incentives for Herbert Smith and Allen & Overy to locate their offices in Belfast, has been touring the City to encourage other firms to follow suit; it also had a presence at the conference.

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